S-4574.4 _______________________________________________
SUBSTITUTE SENATE BILL 6150
_______________________________________________
State of Washington 54th Legislature 1996 Regular Session
By Senate Committee on Health & Long‑Term Care (originally sponsored by Senators Thibaudeau, Deccio, Kohl, Franklin and Wood)
Read first time 02/02/96.
AN ACT Relating to health care professionals doing business as professional service corporations or limited liability companies; and amending RCW 18.100.050 and 25.15.045.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec. 1. RCW 18.100.050 and 1991 c 72 s 3 are each amended to read as follows:
(1) An
individual or group of individuals duly licensed or otherwise legally
authorized to render the same professional services within this state may
organize and become a shareholder or shareholders of a professional corporation
for pecuniary profit under the provisions of Title 23B RCW for the purpose of
rendering professional service((: PROVIDED, That)). One or more
of ((such)) the legally authorized individuals shall be the
incorporators of ((such)) the professional corporation((:
PROVIDED FURTHER, That)).
(2) Notwithstanding
any other provision of this chapter, registered architects and registered
engineers may own stock in and render their individual professional services
through one professional service corporation((: PROVIDED FURTHER, That)).
(3) Licensed
health care professionals, providing services to enrolled participants either
directly or through arrangements with a health maintenance organization registered
under chapter 48.46 RCW or federally qualified health maintenance organization,
may own stock in and render their individual professional services through one
professional service corporation((: AND PROVIDED FURTHER, That)).
(4) Professionals may organize a nonprofit nonstock corporation under this chapter and chapter 24.03 RCW to provide professional services, and the provisions of this chapter relating to stock and referring to Title 23B RCW shall not apply to any such corporation.
(5)(a) Notwithstanding any other provision of this chapter, health care professionals who are licensed or certified pursuant to chapters 18.06, 18.19, 18.22, 18.25, 18.29, 18.34, 18.35, 18.36A, 18.50, 18.53, 18.55, 18.64, 18.79, 18.83, 18.89, 18.108, and 18.138 RCW may own stock in and render their individual professional services through one professional service corporation and are to be considered, for the purpose of forming a professional service corporation, as rendering the "same specific professional services" or "same professional services" or similar terms.
(b) Notwithstanding any other provision of this chapter, health care professionals who are licensed pursuant to chapters 18.57 and 18.71 RCW may own stock in and render their individual professional services through one professional service corporation and are to be considered, for the purpose of forming a professional service corporation, as rendering the "same specific professional services" or "same professional services" or similar terms.
(c) Formation of a professional service corporation under this subsection does not restrict the application of the uniform disciplinary act under chapter 18.130 RCW, or applicable health care professional statutes under Title 18 RCW, including but not limited to restrictions on persons practicing a health profession without being appropriately credentialed and persons practicing beyond the scope of their credential.
Sec. 2. RCW 25.15.045 and 1995 c 337 s 14 are each amended to read as follows:
(1) A person or group of persons licensed or otherwise legally authorized to render professional services within this state may organize and become a member or members of a professional limited liability company under the provisions of this chapter for the purposes of rendering professional service. A "professional limited liability company" is subject to all the provisions of chapter 18.100 RCW that apply to a professional corporation, and its managers, members, agents, and employees shall be subject to all the provisions of chapter 18.100 RCW that apply to the directors, officers, shareholders, agents, or employees of a professional corporation, except as provided otherwise in this section. Nothing in this section prohibits a person duly licensed or otherwise legally authorized to render professional services in any jurisdiction other than this state from becoming a member of a professional limited liability company organized for the purpose of rendering the same professional services. Nothing in this section prohibits a professional limited liability company from rendering professional services outside this state through individuals who are not duly licensed or otherwise legally authorized to render such professional services within this state. Notwithstanding RCW 18.100.065, persons engaged in a profession and otherwise meeting the requirements of this chapter may operate under this chapter as a professional limited liability company so long as each member personally engaged in the practice of the profession in this state is duly licensed or otherwise legally authorized to practice the profession in this state and:
(a) At least one manager of the company is duly licensed or otherwise legally authorized to practice the profession in this state; or
(b) Each member in charge of an office of the company in this state is duly licensed or otherwise legally authorized to practice the profession in this state.
(2) If the company's
members are required to be licensed to practice such profession, and the
company fails to maintain for itself and for its members practicing in this
state a policy of professional liability insurance, bond, or other evidence of
financial responsibility of a kind designated by rule by the state insurance
commissioner and in the amount of at least one million dollars or ((such))
a greater amount as the state insurance commissioner may establish by
rule for a licensed profession or for any specialty within a profession, taking
into account the nature and size of the business, then the company's members ((shall
be)) are personally liable to the extent that, had ((such)) the
insurance, bond, or other evidence of responsibility been maintained, it would
have covered the liability in question.
(3) For purposes of
applying the provisions of chapter 18.100 RCW to a professional limited
liability company, the terms "director" or "officer" ((shall))
means manager, "shareholder" ((shall)) means
member, "corporation" ((shall)) means professional
limited liability company, "articles of incorporation" ((shall))
means certificate of formation, "shares" or "capital
stock" ((shall)) means a limited liability company interest,
"incorporator" ((shall)) means the person who executes
the certificate of formation, and "bylaws" ((shall)) means
the limited liability company agreement.
(4) The name of a professional limited liability company must contain either the words "Professional Limited Liability Company," or the words "Professional Limited Liability" and the abbreviation "Co.," or the abbreviation "P.L.L.C." provided that the name of a professional limited liability company organized to render dental services shall contain the full names or surnames of all members and no other word than "chartered" or the words "professional services" or the abbreviation "P.L.L.C."
(5) Subject to the provisions in article VII of this chapter, the following may be a member of a professional limited liability company and may be the transferee of the interest of an ineligible person or deceased member of the professional limited liability company:
(a) A professional corporation, if its shareholders, directors, and its officers other than the secretary and the treasurer, are licensed or otherwise legally authorized to render the same specific professional services as the professional limited liability company; and
(b) Another professional limited liability company, if the managers and members of both professional limited liability companies are licensed or otherwise legally authorized to render the same specific professional services.
(6)(a) Notwithstanding any other provision of this chapter, health care professionals who are licensed or certified pursuant to chapters 18.06, 18.19, 18.22, 18.25, 18.29, 18.34, 18.35, 18.36A, 18.50, 18.53, 18.55, 18.64, 18.79, 18.83, 18.89, 18.108, and 18.138 RCW may own membership interests in and render their individual professional services through one limited liability company and are to be considered, for the purpose of forming a limited liability company, as rendering the "same specific professional services" or "same professional services" or similar terms.
(b) Notwithstanding any other provision of this chapter, health care professionals who are licensed pursuant to chapters 18.57 and 18.71 RCW may own membership interests in and render their individual professional services through one limited liability company and are to be considered, for the purpose of forming a limited liability company, as rendering the "same specific professional services" or "same professional services" or similar terms.
(c) Formation of a limited liability company under this subsection does not restrict the application of the uniform disciplinary act under chapter 18.130 RCW, or any applicable health care professional statutes under Title 18 RCW, including but not limited to restrictions on persons practicing a health profession without being appropriately credentialed and persons practicing beyond the scope of their credential.
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