Nurse Practitioner

by Lisa
(MO)

Hello, I work as an independent contractor as a nurse practitioner for a doctor.

I get no taxes removed from my pay. I have personal liability insurance. I have thought of incorporating to make sure if ever I was sued (hopefully never), that my personal assets would be safe.

1) Is this true?
2) Would I be a single member LLC

I have also been told that if I make myself an employee of my incorporation that would further protect myself.
What do you think?

Answer

Incorporating probably will NOT protect you from medical malpractice liability for your own negligence. This is why you must always keep your malpractice premiums current.

The only advantage incorporating (vs. a partnership) has for professionals is that you will not be personally liable for your partner's malpractice (though the company might be). If you don't have partners, then this isn't an issue for you.

As a single member LLC, you would still be personally liable for your own medical negligence in the O.R. or where ever else you are performing medical treatment.

Where the LLC could protect you is if your practice has contractual disputes--say with your employer, supplier, or landlord--and therefore limit their recovery to your LLC assets.

So, for example, suppose you lease office space for your practice. By having the lease under your LLC and not you personally, you could avoid personal liability if you are sued under the lease.

Note that you'll have to negotiate hard to get a landlord to lease property to your LLC without a personal guarantee.

If you are involved in a lot of transactions (like leasing real estate, or buying large amounts of supplies/equipment), it might be worth it to form an LLC.

However, forming an LLC will not protect you from medical malpractice claims. Have a good insurance policy.

Also, you would probably have to form a Professional LLC, if you are performing medical services in Missouri.