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Using separate EIN/companies for separate services

Hi all, long time!

So I have opened up an IOP program, which will hopefully be expanding soon. This is company A. Company A is in the process of going in network with insurance companies for payment of services.

Along with it, still within company A, my staff has seen folks for traditional outpatient counseling. The outpatient counseling has utilized out of network benefits, and has been lucrative. I would like to remain off insurance panels for the outpatient portion - thus my idea to use a separate company (one that I already had employing therapists in the past) for outpatient services - this is company B. I am not thinking of using a DBA because I need a separate tax ID to bill insurance separately altogether. Currently everything is under company A but it may 'force' me to be in network w insurance companies to keep all the services under one company tax ID - thus the split.

The questions that arise are: does company B need to pay company A any rent because patients will be seen at the same location (company A is a lease tenant not a building owner), does company B have to pay company A for a portion of employee salaries/should I just draft something to split 50/50 on salaries/can company A continue to pay all salaries, and what kind of agreement do I need between the companies (should company A contract with company B to provide outpatient counseling services and if all profits from outpatient will be 100% company b, does that cause confusion? Do I have to give company A a portion of profits?)

Just some of the quick questions off the top of my head.

Thanks in advance!

Zip Code: 08831

Re: Using separate EIN/companies for separate services

Hi. I've seen this to be an issue with other medical practices lately, and what these practices are doing is setting up either an LLC or an S-Corp that is owned 100% by the entity that owns your practice. The new entity would be considered a "disregarded entity", so would not be a separate taxable entity from your practice. However, you will be able to get an EIN for this new entity, and use that new EIN for billing purposes.

Please consult with your healthcare attorney and CPA for clarification and confirmation about how best to set up this new entity for your specific purposes. Let us know if they provide you any information that is contrary to my short response above.

Zip Code: 01801