Health Care

The Legal and Regulatory Considerations for Starting an Independent Nursing Practice

Independent Nursing Practice

As more and more nursing professionals gain the credentials to be Advanced Practice Registered Nurses (APRNs), including nurse practitioners, certified nurse midwives, and clinical nurse specialists, the number of independent nursing practices is growing in the United States. With the current shortage of primary care providers increasing across the nation, now is a great time for APRNs to establish their own practices where they can provide comprehensive medical care. 

If you’ve been thinking about starting your own practice, then you probably already know that it requires major investments and careful planning. In an industry as tightly regulated as healthcare, the setup of a new business can be especially complex and challenging. Compliance is key, and it can take a while to get everything set up properly.

It’s important to understand the legal and regulatory considerations of starting a practice well before you want to start welcoming patients. 

Understanding State Laws and Regulations 

Each state has its own medical licensure requirements. While licensed physicians can open full practices in all 50 states, APRN private practice laws vary, according to the Nursing Practice Act for each state. 

In some states, licensed APRNs can open full practices without physician supervision. In others, nurse practitioners can have “reduced practice.” This means that an APRN can provide some services independently, but must have physician supervision for other services. For example, an APRN in a reduced practice state might be allowed to provide diagnosis and treatment but must collaborate with a physician to prescribe medication. 

Restricted practice states limit APRNs to open private practices. In these states, full physician supervision or oversight is required. 

Before you decide to open a private practice, it’s important to understand what kinds of services you’ll be allowed to offer your patients. Will you need to find a physician to form a collaborative practice with you, if you live in a reduces or restricted practice state? Do you need to consider getting licensed in another state and relocating to open your practice? 

State laws might also regulate how you are allowed to bill patients, dispose of medical waste, and other aspects of running a private practice. Do your research before you start looking for a space or making other preparations. 

Complying with Federal Law 

Federal laws in the healthcare field are designed to protect patients. There are very severe consequences for businesses and individuals who violate these laws, and it’s critical for all private practice owners to ensure that they are maintaining best practices and staying in compliance with federal laws and regulations. Although there are many different laws and regulations you will need to research and ensure your practice’s compliance, here are some of the most notable: 

  • The Health Insurance Portability and Accountability Act (HIPAA)—Regulates the collection, use, and storage of protected health information to help ensure patient privacy. 
  • Medicare/Medicaid regulations—Laws and regulations for providers surrounding federal and state health insurance programs. 
  • Anti-Kickback Statute and Stark Law—Laws that restrict compensation and conflicts of interest when providing referrals to patients. 
  • Business regulations—Private nursing practices must comply with state and federal business laws and regulations, in addition to the laws applying to the healthcare industry.

Choosing a Business Structure 

Business structures are used in the regulation and taxation of businesses. When opening a private nursing practice, you might be restricted in the type of structure you can choose. It’s important to choose a business structure that will protect you personally in case of any liability problems that come up. 

For this reason, many nurse practitioners end up with a structure such as a Professional Corporation (PC), which is a special type of corporate structure that’s limited to licensed professionals. You might also consider a Limited Liability Company (LLC) or another type of corporate structure. Sole proprietorships are not recommended and are often not even allowed for private medical practices. 

The structure you choose for your business will impact how it is taxed. Be sure to work with an accountant to crunch the numbers and determine what your tax obligations are likely to be. You want to avoid surprises at tax time and ensure that you have been complying with all relevant IRS requirements. 

Insurance for Nursing Practices 

All medical practices need comprehensive insurance. Things can and do go wrong when you’re working with patients and it’s very important to protect yourself and your business from issues like employee injuries, malpractice claims, and other potential liabilities. Depending on the services you offer and how many people you employ, your needs for insurance might differ from other practices. 

Picking the right policies can be a challenge. It’s important to have someone knowledgeable advise you on the types and amount of coverage you need. Be sure you fully understand what your insurance does and doesn’t cover before you sign the paperwork. 

Even the best medical providers can’t prevent all accidents, mistakes, and other issues that might require insurance coverage. An insurance claim that won’t be covered can easily cause major financial problems for small medical practices. 

Seek Expert Guidance in Setting Up Your Practice 

As a nurse practitioner or another type of APRN, your focus is on providing excellent medical care, not on understanding the legal minutia of the healthcare industry. However, as the owner of a private practice, you are responsible for the structure, setup, and compliance of your business. 

For that reason, it’s critical to get help from an experienced attorney specializing in healthcare laws to ensure you are in compliance with relevant laws, and an accountant who can help you get your financial structures squared away. It’s very important to choose trustworthy advisors to help prevent non-compliance or even business and financial scandals

The initial setup of a private practice can be expensive, frustrating, and time-consuming. However, once you have your practice up and running and you start building a great reputation in your community, the freedom, autonomy, and earning potential will be well worth the challenges involved in getting started. Do your research, find advisors you can trust, and start the process as soon as you can! 

You may also like...