The separation of the PC and MSO entities establishes distinct ownership and responsibilities for clinical versus non-clinical operations. At the core of this relationship is the physician-owned PC.
As the clinical practice entity, the PC is owned and controlled by licensed physicians. These doctors maintain ownership of core medical assets like the clinic building, medical equipment, and clinical contracts. They are also responsible for direct patient care, treatment decisions, and provider hiring and credentialing.
However, managing the business operations of a practice takes time away from patient care. This is where bringing in an MSO partner can provide value. When an outside group wishes to purchase a practice, they acquire the non-clinical assets and form an MSO. This may include the purchase of assets such as medical records, intellectual property, workforce infrastructure, and administrative systems.
By creating the MSO as a separate legal entity with new ownership, investment or management firms can handle non-clinical functions while staying in compliance with medicine laws. The MSO then provides defined administrative services to the physician-owned PC through a formal Management Services Agreement. This contractual relationship is the backbone of the MSO-PC partnership and ensures a clear delineation of clinical versus business responsibilities.
