Managing healthcare entity compliance in Oregon requires navigating some of the nation's most restrictive Corporate Practice of Medicine regulations. House Bill 4130 (2024) and Senate Bill 951 (2025) prohibit management services organizations from owning majority interests in medical practices, serving as directors or officers, or exercising control over clinical decisions. For healthcare organizations with existing MSO relationships, immediate compliance audits are essential to avoid administrative dissolution, civil penalties, and professional licensing implications.
Oregon recognizes three professional entity types for healthcare organizations. Professional Corporations (PCs) and Professional Associations (PAs) are governed by identical provisions under ORS Chapter 58, making them legally indistinguishable. Oregon Medical Board guidance indicates that physicians, dentists, and nurses must form PCs rather than PLLCs as their primary entity type. Limited Liability Partnerships (LLPs) are available under ORS Chapter 67 but contain no healthcare-specific formation rules.
Professional Corporations (PCs) and Professional Associations (PAs)
Oregon statute treats Professional Corporations and Professional Associations as the same entity type under ORS 58.015. ORS 58.375 establishes foundational requirements: physicians licensed in Oregon must hold the majority of each class of voting shares and constitute the majority of the corporation's directors. This ownership structure prevents unlicensed entities from controlling medical practices.
Your corporate name must include "Professional Corporation," "P.C.," or "Prof. Corp." as required by ORS 58.115 and comply with rules of the relevant regulatory board.
Professional Limited Liability Companies (PLLCs)
PLLCs operate under a dual statutory framework combining ORS Chapter 63 with professional service requirements from ORS Chapter 58. Medical practice PLLCs must comply with the same physician majority ownership requirements found in ORS 58.375. However, Oregon regulatory guidance indicates physicians, dentists, and nurses must form PCs rather than PLLCs as their primary entity type.
Limited Liability Partnerships (LLPs)
LLPs are governed by ORS Chapter 67, which contains no unique formation rules for healthcare entities. Registration requirements are found in ORS 67.603, with annual reports required under ORS 67.645.
Oregon rigorously enforces the Corporate Practice of Medicine doctrine through case law and recent legislation. The foundational precedent, Sisemore v. Oregon State Board of Medical Examiners (1947), established that unlicensed entities cannot control medical practices.
HB 4130 (2024) prohibits dual control between medical corporations and MSOs, restricts MSO involvement in clinical and employment decisions, and establishes private rights of action for CPOM violations. SB 951 (2025) prohibits MSOs from owning or controlling professional medical entities they manage and declares violating agreements unenforceable and void.
Specific exceptions exist for hospitals, long-term care facilities, telemedicine providers without physical presence in Oregon, and certain coordinated care organizations.
You must obtain an active license in good standing before forming a Professional Corporation. Submit applications to your licensing board, complete verification processes, and receive active licenses before proceeding to entity formation. The Oregon Secretary of State processes online filings within 1-3 business days at no additional expedited fee.
Registered agent maintenance
Every professional entity must maintain a registered agent with an Oregon address per ORS 60.111. Discern provides registered agent services across all jurisdictions, ensuring continuous compliance.
Annual report requirements
You must file annual reports on the anniversary date of your entity's formation, not a universal deadline. PCs pay $275 annually while PLLCs pay $100, creating a $175 annual differential. Failure to file results in administrative dissolution.
Tax obligations
If your Oregon commercial activity exceeds $1 million, you must file Corporate Activity Tax returns by April 15 ($250 plus 0.57% of activity over $1 million). Healthcare entities receive no special exemptions or reduced rates.
The Oregon Medical Board requires physicians with active status to complete 30 hours of CME annually relevant to current medical practice. Licenses renew biennially by December 31 of odd-numbered years with a $752 total fee.
Per ORS 58.375, maintaining an active Oregon physician license is mandatory for holding majority ownership in medical professional corporations. Lapse or suspension directly affects ownership eligibility. Healthcare organizations expanding into Oregon from other states must understand foreign registration requirements and CPOM restrictions before operating.
Oregon prohibits multi-discipline healthcare practice ownership. ORS 58.375 requires medical PCs to be majority-owned by licensed physicians. The Oregon Board of Dentistry requires dental practices to be owned exclusively by licensed dentists. Each healthcare profession must maintain separate legal entities with profession-specific ownership qualifications.
Can a management services organization employ physicians in Oregon? No. Senate Bill 951 (2025) prohibits MSOs from owning or controlling a majority interest in professional medical entities, serving as directors or officers, exercising control over clinical decision-making, or managing physician employment decisions. Existing MSO arrangements must be restructured to eliminate prohibited provisions.
What happens if my Oregon medical license lapses? Lapse or suspension directly affects your eligibility to hold majority ownership under ORS 58.375. Practicing with a lapsed license constitutes practicing without a license, a felony offense. You must maintain active licensure through biennial renewal, complete 30 hours of CME annually, and pay the $752 renewal fee to retain ownership eligibility.
Are there different annual filing requirements for PCs versus PLLCs? Yes. PCs pay $275 annually while PLLCs pay $100. Both file on the anniversary date of formation rather than a universal deadline. This creates a $175 annual cost differential, though statutory requirements mandate PC formation for most healthcare professionals.
Can physicians and dentists co-own a single professional entity? No. Oregon prohibits multi-discipline ownership. ORS 58.375 requires medical PCs to be majority-owned by licensed physicians only. Dental practices must be owned exclusively by licensed dentists. Each profession requires separate legal entities.
Oregon healthcare entities face complex compliance: entity-specific anniversary deadlines, biennial physician renewals, 30-hour annual CME tracking, and strict CPOM restrictions requiring organizational restructuring. Missing deadlines results in administrative dissolution and loss of good standing.
Discern automates compliance tracking, monitors anniversary-based deadlines, and provides registered agent services across all jurisdictions. Ready to simplify your healthcare entity compliance? Book a demo with Discern today.
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