If you're managing a Kansas healthcare practice, you're dealing with one of the more complex compliance frameworks in the country. Kansas strictly enforces Corporate Practice of Medicine restrictions under K.S.A. 65-2867(a), meaning you can't just set up a standard business corporation and hire physicians. The Kansas Supreme Court reinforced this in Central Kansas Medical Center v. Hatesohl, 308 Kan. 689, ruling that employment contracts violating CPOM doctrine are unenforceable. For you as a practice owner or healthcare administrator, these restrictions create compliance obligations that extend from initial formation through daily operations—and the consequences of getting it wrong are significant.
You have four options for structuring your Kansas healthcare practice: Professional Corporations (which must use the PA designation), Professional LLCs (which must use LLC designation—not PLLC), and Limited Liability Partnerships (LLP). Each structure requires dual approvals from both the Kansas Secretary of State and the Kansas Board of Healing Arts before you can commence operations.
When you're choosing an entity structure for your Kansas healthcare practice, you'll navigate four distinct options, each governed by specific statutory provisions and designed to maintain professional licensure requirements while providing liability protection.
Note: Professional Corporations in Kansas must use the "PA" (Professional Association) designation rather than "PC"—this isn't a separate entity type, it's a mandatory naming requirement that trips up many practices forming in Kansas for the first time.
Professional Corporations (PA Designation Required)
Professional Corporations in Kansas operate under K.S.A. 17-2707 et seq., which establishes comprehensive formation and governance requirements. The Kansas Professional Corporation Law defines eligible healthcare professions and mandates that all shareholders hold valid professional licenses. Critically, professional corporations in Kansas must use the designation "PA" (Professional Association) rather than the commonly-used "PC" designation. K.S.A. 17-2712(d) requires that shareholders be licensed professionals or qualified entities, while K.S.A. 40-3401 et seq. establishes mandatory professional liability insurance compliance. Additionally, your professional entity must obtain certification from the appropriate Kansas licensing board before formation, reflecting Kansas's dual regulatory oversight model where both the Kansas Secretary of State and professional licensing boards maintain authority over healthcare entity formation and ongoing compliance.
Professional Limited Liability Companies (LLC Designation Required)
Professional LLCs in Kansas follow K.S.A. 17-7673, requiring licensing certification from relevant Kansas professional boards. Kansas requires professional LLCs to use standard LLC designators (LLC, L.L.C., etc.)—the "PLLC" designation is not permitted. K.S.A. 40-3401 provides statutory recognition of professional LLCs as healthcare provider entities for insurance purposes, while K.S.A. 65-4978 explicitly includes professional LLCs in the definition of healthcare providers for medical retainer agreements.
All members must hold valid Kansas professional licenses in the field of practice. Your entity must file articles of organization with the Secretary of State and obtain certification from the Kansas Board of Healing Arts confirming compliance with professional ownership requirements.
Limited Liability Partnerships
LLPs operate under the Kansas Uniform Partnership Act codified at K.S.A. 56a-1001 et seq. K.S.A. 40-3401 explicitly includes partnerships of healthcare providers in the definition of "healthcare provider," while K.S.A. 56a-1202 mandates reporting requirements for foreign LLPs. The 2023 House Bill No. 2325 amended K.S.A. 40-3401 to clarify healthcare provider status for partnerships.
Your LLP must maintain a registered office and resident agent in Kansas. If you're operating a foreign LLP in Kansas, you must file biennial business entity information reports with the Secretary of State.
Corporate Practice of Medicine Enforcement
Kansas strictly enforces CPOM doctrine through K.S.A. 65-2867(a), which prohibits unlicensed entities from practicing medicine or maintaining medical offices. The Kansas Supreme Court established binding precedent in Central Kansas Medical Center v. Hatesohl, holding that employment contracts between unlicensed entities and physicians are void as against public policy.
Permitted structures include professional corporations wholly owned by licensed professionals and licensed hospital employment. Prohibited structures include general business corporation employment of physicians and non-physician ownership of medical practices.
Forming a Kansas healthcare entity means navigating a two-stage approval process that trips up many first-time filers: you must obtain certification from the Kansas Board of Healing Arts (KSBHA) before filing formation documents with the Kansas Secretary of State, not after. The following table summarizes formation requirements:
After formation, your healthcare entity must maintain required professional liability insurance under the Kansas Health Care Stabilization Fund, file biennial information reports, and ensure all members maintain current professional licenses.
One Discern customer managing over 200 healthcare entities across multiple states described the pre-automation process as "existential dread of not knowing" which filing deadlines were approaching and which entities might fall out of good standing.
Kansas's transition to biennial reporting in 2024, combined with the new 2025 penalty structure, means you face steeper consequences for missing deadlines while tracking fewer filing cycles. The state implemented significant compliance changes including biennial reporting (effective January 1, 2024) and increased late filing penalties under House Bill 2206 (2025): $100 first day late plus $50 per additional day.
Biennial Reporting Requirements
Kansas requires biennial (every two years) information reporting for all healthcare entities, effective January 1, 2024. Unlike states with annual reporting requirements, you'll file less frequently—but the new 2025 penalty structure means missing deadlines costs significantly more. For-profit healthcare entities (Professional Corporations, PLLCs, Professional Associations) must file information reports by April 15 of their designated odd or even year. Nonprofit healthcare entities must file information reports by June 15 of their designated odd or even year.
For practices managing multiple entities, Discern customers typically complete these biennial filings in under 3 minutes per entity—compared to the hours traditionally spent coordinating with registered agents and tracking deadlines manually.
2025 Penalty Structure Changes: Late Filing Penalties Under HB 2206
House Bill 2206 (2025) created a new penalty structure: $100 penalty on the first day late, plus $50 per day for each subsequent day late. This represents a dramatic increase in the cost of compliance failures.
Corporate Income Tax Obligations
Healthcare professional entities organized as corporations are subject to Kansas corporate income tax. According to the 2025 Kansas Corporate Income Tax Instructions (Form K-120), all corporations doing business in Kansas or deriving income from Kansas sources must file Form K-120. This requirement applies to Professional Corporations (PCs), Professional Limited Liability Companies (PLLCs) taxed as corporations, and multi-member LLCs taxed as corporations. For calendar year entities, the corporate income tax return is due April 15 annually.
Your healthcare entity compliance extends beyond business formation requirements to encompass professional licensing obligations that directly affect ownership eligibility and operational authority.
Kansas Board of Healing Arts Licensing Requirements
The Kansas Board of Healing Arts administers physician licensing for both MDs and DOs. As a Kansas physician, you must complete 50 credit hours of continuing medical education annually for license renewal. At least 20 credit hours must be Category 1 CME credits (AMA PRA Category 1, AOA Category 1-A, or AOA Category 1-B). The remaining 30 hours can be Category 2, Category 3 (activities addressing specific mandated content such as acute or chronic pain management, appropriate prescribing of opioids, or use of prescription drug monitoring programs), or other approved CME types.
Licensing Fees and Renewal Cycle
Kansas operates on an annual license renewal cycle. Initial application fees for active or federal active licenses are $300.00. Annual renewal fees are $360.00 for online renewal or $430.00 for paper renewal. Late renewal penalties add $100.00 to online renewals (total $460.00) or $230.00 to paper renewals (total $660.00).
Critical Connection Between Licensure Status and Entity Ownership
K.S.A. 65-28,134 creates a fundamental link between professional licensure status and healthcare entity ownership eligibility. The statute defines "licensee" as "a person licensed by the Board to practice medicine or chiropractic with a full active status, not revoked, suspended, limited, or placed under probationary conditions." Only physicians maintaining full, active, unrestricted licensure qualify as "licensees" eligible for healthcare entity ownership and participation. Physicians with revoked, suspended, limited, or probationary licenses are not considered "licensees" and are therefore ineligible to own professional corporations or participate in professional entities.
This creates significant tracking complexity for multi-entity practices. Discern automates this monitoring, with customers reporting they've eliminated the manual spreadsheet tracking that previously consumed 5-10 hours monthly.
Multi-Profession Entity Considerations
K.S.A. 17-2709 explicitly authorizes multi-discipline professional corporations, permitting entities to "render more than one type of professional service provided the corporation obtains from each licensing board which regulates a profession to be practiced in the corporation a certification that the organization complies with the laws of the state of Kansas and the licensing board's rules and regulations."
If you're structuring a multi-discipline entity with shareholders from different healthcare professions, you must obtain certification from each relevant licensing board, ensure all shareholders are licensed professionals (though holding different types of professional licenses), and comply with all regulatory requirements applicable to each profession represented in the ownership structure. For example, a professional association with physician shareholders, nurse practitioner shareholders, and physical therapist shareholders must obtain certification from the Board of Healing Arts, Board of Nursing, and Board of Physical Therapy.
Can a general business corporation employ physicians in Kansas, or does CPOM doctrine prohibit this structure?
Kansas strictly enforces the Corporate Practice of Medicine doctrine, prohibiting general business corporations from employing physicians. K.S.A. 65-2867(a) prohibits unlicensed entities from practicing medicine or maintaining medical offices. The Kansas Supreme Court established binding precedent in Central Kansas Medical Center v. Hatesohl, holding that employment contracts between unlicensed entities and physicians are unenforceable as against public policy. Permitted structures include professional corporations wholly owned by licensed professionals or employment by licensed hospitals that hold authority to provide medical services.
What happens to healthcare entity ownership if a physician's license lapses or faces disciplinary action in Kansas?
License status directly affects your healthcare entity ownership eligibility under K.S.A. 65-28,134, which defines "licensee" as a person licensed "with a full active status, not revoked, suspended, limited, or placed under probationary conditions." Any restriction on licensure disqualifies the physician from "licensee" status and terminates their eligibility for healthcare entity ownership. K.S.A. 17-2709 requires that professional corporation shares owned by persons who become disqualified must be transferred to the corporation or qualified persons within a reasonable time not exceeding one year. The Kansas Board of Healing Arts can revoke entity certificates of authorization if entities employ non-licensed individuals or fail to maintain required licensure standards.
Does Kansas require biennial reports for healthcare professional entities, and what are the filing deadlines?
Yes, Kansas requires biennial information reports filed every two years for all healthcare entities, effective January 1, 2024. For-profit healthcare entities must file information reports by April 15 of their designated odd or even year, with a three-month grace period extending to July 15. Kansas enacted substantial penalty increases in 2025 through House Bill 2206, imposing a $100 penalty on the first day late plus an additional $50 penalty per day thereafter.
What are the key differences between forming a PC and LLC for healthcare practices in Kansas?
Professional Corporations and Professional LLCs differ in formation costs, naming requirements, and governing statutes. PCs file Form DPA with a $90 filing fee for for-profit entities under K.S.A. 17-2707 et seq., while PLLCs file Form PDL with a $165 filing fee under K.S.A. 17-7673. PCs must use "Chartered," "Professional Association," "P.A.," or "PA" designations. PLLCs must use standard LLC designators including "L.L.C.," "L.C.," "LLC," "LC," "LIMITED LIABILITY COMPANY," or "LIMITED COMPANY." Both entity types require pre-formation certification from the Kansas Board of Healing Arts, mandatory professional liability insurance under K.S.A. 40-3401 et seq., and biennial information reports. Both face identical CPOM restrictions requiring all owners to be licensed professionals.
Can different types of healthcare professionals (physicians, nurses, therapists) co-own a single professional entity in Kansas?
Kansas explicitly permits multi-discipline healthcare entity ownership under K.S.A. 17-2709, which authorizes professional corporations to "render more than one type of professional service provided the corporation obtains from each licensing board which regulates a profession to be practiced in the corporation a certification that the organization complies with the laws of the state of Kansas and the licensing board's rules and regulations." A professional corporation can legally have physician shareholders, nurse practitioner shareholders, and physical therapist shareholders, provided the entity obtains certification from the Board of Healing Arts, Board of Nursing, and Board of Physical Therapy. All shareholders must be licensed professionals, though they may hold different types of professional licenses. Your entity must comply with all regulatory requirements applicable to each profession represented in the ownership structure.
Managing Kansas healthcare entity compliance means juggling biennial information reports (not annual), dual regulatory oversight from both the Secretary of State and professional licensing boards, strict naming requirements (PA for professional corporations, LLC for professional LLCs—not PLLC), and continuous monitoring of ownership eligibility tied to professional licensure status.
Ready to eliminate your compliance tracking burden? Book a demo with Discern today and see how we automate Kansas healthcare entity compliance while ensuring continuous good standing.
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