Senate Study Bill 1092
SENATE FILE
BY (PROPOSED COMMITTEE ON
HUMAN RESOURCES BILL
BY CHAIRPERSON RAGAN)
Passed Senate, Date Passed House, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act to allow medical or osteopathic physicians, physician
2 assistants, and nurse practitioners to form limited liability
3 companies or professional corporations.
4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
5 TLSB 1781SC 83
6 jr/nh/8
PAG LIN
1 1 Section 1. Section 490A.1501, subsection 4, Code 2009, is
1 2 amended to read as follows:
1 3 4. "Profession" means the profession of certified public
1 4 accountancy, architecture, chiropractic, dentistry, physical
1 5 therapy, practice as a physician assistant, psychology,
1 6 professional engineering, land surveying, landscape
1 7 architecture, law, medicine and surgery, optometry,
1 8 osteopathic medicine and surgery, accounting practitioner,
1 9 podiatry, real estate brokerage, speech pathology, audiology,
1 10 veterinary medicine, pharmacy, practice as a nurse
1 11 practitioner, nursing, and marriage and family therapy,
1 12 provided that the marriage and family therapist is licensed
1 13 under chapters 147 and 154D.
1 14 Sec. 2. Section 490A.1502, Code 2009, is amended to read
1 15 as follows:
1 16 490A.1502 PURPOSES AND POWERS.
1 17 1. A professional limited liability company shall be
1 18 organized only for the purpose of engaging in the practice of
1 19 one specific profession, or two or more specific professions
1 20 which could lawfully be practiced in combination by a licensed
1 21 individual or a partnership of licensed individuals, and for
1 22 the additional purpose of doing all lawful things which may be
1 23 incidental to or necessary or convenient in connection with
1 24 the practice of the profession or professions. The articles
1 25 of organization of a professional limited liability company
1 26 shall state in substance that the purposes for which the
1 27 professional limited liability company is organized are to
1 28 engage in the general practice of a specified profession or
1 29 professions, or one or more specified branches or divisions
1 30 thereof, and to do all lawful things which may be incidental
1 31 to or necessary or convenient in connection with the practice
1 32 of the profession or professions.
1 33 2. For purposes of this section, medicine and surgery,
1 34 osteopathic medicine and surgery, practice as a physician
1 35 assistant, and practice as a nurse practitioner shall be
2 1 deemed to be professions which could lawfully be practiced in
2 2 combination by licensed individuals or a partnership of
2 3 licensed individuals.
2 4 Sec. 3. Section 490A.1505, Code 2009, is amended to read
2 5 as follows:
2 6 490A.1505 PRACTICE BY PROFESSIONAL LIMITED LIABILITY
2 7 COMPANY.
2 8 1. Notwithstanding any other statute or rule of law, a
2 9 professional limited liability company may practice a
2 10 profession, but may do so in this state only through members,
2 11 managers, employees, and agents who are licensed to practice
2 12 the same profession in this state. In its practice of a
2 13 profession, no professional limited liability company shall do
2 14 any act which could not lawfully be done by individuals
2 15 licensed to practice the profession which the professional
2 16 limited liability company is authorized to practice.
2 17 2. This section shall not prohibit persons practicing
2 18 medicine and surgery, persons practicing osteopathic medicine
2 19 and surgery, persons practicing as physician assistants, or
2 20 persons practicing as nurse practitioners, from practicing
2 21 their respective professions in lawful combination pursuant to
2 22 section 490A.1502.
2 23 Sec. 4. Section 490A.1514, Code 2009, is amended to read
2 24 as follows:
2 25 490A.1514 MANAGEMENT.
2 26 All managers of a professional limited liability company
2 27 shall at all times be individuals who are licensed to practice
2 28 a profession in this state, or a lawful combination of
2 29 professions pursuant to section 490A.1502, which the limited
2 30 liability company is authorized to practice. A person who is
2 31 not licensed shall have no authority or duties in the
2 32 management or control of the limited liability company. If a
2 33 manager ceases to have this qualification, the manager shall
2 34 immediately and automatically cease to hold such management
2 35 position.
3 1 Sec. 5. Section 496C.2, subsection 4, Code 2009, is
3 2 amended to read as follows:
3 3 4. "Profession" means the profession of certified public
3 4 accountancy, architecture, chiropractic, dentistry, physical
3 5 therapy, practice as a physician assistant, psychology,
3 6 professional engineering, land surveying, landscape
3 7 architecture, law, medicine and surgery, optometry,
3 8 osteopathic medicine and surgery, accounting practitioner,
3 9 podiatry, real estate brokerage, speech pathology, audiology,
3 10 veterinary medicine, pharmacy, practice as a nurse
3 11 practitioner, and the practice of nursing.
3 12 Sec. 6. Section 496C.4, Code 2009, is amended to read as
3 13 follows:
3 14 496C.4 PURPOSES AND POWERS.
3 15 1. A professional corporation shall be organized only for
3 16 the purpose of engaging in the practice of one specific
3 17 profession, or two or more specific professions which could
3 18 lawfully be practiced in combination by a licensed individual
3 19 or a partnership of licensed individuals, and for the
3 20 additional purpose of doing all lawful things which may be
3 21 incidental to or necessary or convenient in connection with
3 22 the practice of the profession or professions. The articles
3 23 of incorporation shall state in substance that the purposes
3 24 for which the corporation is organized are to engage in the
3 25 general practice of a specified profession or professions, or
3 26 one or more specified branches or divisions thereof, and to do
3 27 all lawful things which may be incidental to or necessary or
3 28 convenient in connection with the practice of the profession
3 29 or professions. Each professional corporation, unless
3 30 otherwise provided in its articles of incorporation or unless
3 31 expressly prohibited by this chapter, shall have all powers
3 32 granted to corporations by the Iowa business corporation Act,
3 33 chapter 490.
3 34 2. For purposes of this section, medicine and surgery,
3 35 osteopathic medicine and surgery, practice as a physician
4 1 assistant, and practice as a nurse practitioner shall be
4 2 deemed to be professions which could lawfully be practiced in
4 3 combination by licensed individuals or a partnership of
4 4 licensed individuals.
4 5 Sec. 7. Section 496C.7, Code 2009, is amended to read as
4 6 follows:
4 7 496C.7 PRACTICE BY PROFESSIONAL CORPORATION.
4 8 1. Notwithstanding any other statute or rule of law, a
4 9 professional corporation may practice a profession, but may do
4 10 so in this state only through shareholders, directors,
4 11 officers, employees, and agents who are licensed to practice
4 12 the same profession in this state.
4 13 2. In its practice of a profession, no professional
4 14 corporation shall do any act which could not lawfully be done
4 15 by individuals licensed to practice the profession which the
4 16 professional corporation is authorized to practice.
4 17 3. This section shall not prohibit persons practicing
4 18 medicine and surgery, persons practicing osteopathic medicine
4 19 and surgery, persons practicing as physician assistants, or
4 20 persons practicing as nurse practitioners, from practicing
4 21 their respective professions in lawful combination pursuant to
4 22 section 496C.4.
4 23 Sec. 8. Section 496C.16, Code 2009, is amended to read as
4 24 follows:
4 25 496C.16 MANAGEMENT.
4 26 All directors of a professional corporation and all
4 27 officers of a professional corporation, except assistant
4 28 officers, shall at all times be individuals who are licensed
4 29 to practice in this state a profession, or a lawful
4 30 combination of professions pursuant to section 496C.4, which
4 31 the corporation is authorized to practice. However, upon the
4 32 occurrence of any event that requires the corporation either
4 33 to be dissolved or to elect to adopt the provisions of the
4 34 Iowa business corporation Act, chapter 490, as provided in
4 35 section 496C.19, provided the corporation ceases to practice
5 1 the profession that the corporation is authorized to practice,
5 2 as provided in section 496C.19, then individuals who are not
5 3 licensed to practice in this state a profession that the
5 4 corporation is authorized to practice may be appointed as
5 5 officers and directors for the sole purpose of carrying out
5 6 the dissolution of the corporation or, if applicable, the
5 7 voluntary election of the corporation to adopt the provisions
5 8 of the Iowa business corporation Act, as provided in section
5 9 496C.19.
5 10 EXPLANATION
5 11 This bill allows physician assistants and nurse
5 12 practitioners to form professional corporations and
5 13 professional limited liability companies. The bill also
5 14 provides that persons who are licensed to practice medicine
5 15 and surgery, physician assistants, and nurse practitioners may
5 16 jointly form professional corporations and professional
5 17 limited liability companies.
5 18 LSB 1781SC 83
5 19 jr/nh/8