New York telehealth MSO-PC: licensing, ownership, and fee rules
Treating New York patients online takes a New York license for every physician, a professional corporation owned by New York physicians, and an MSO fee that stays clear of the state's fee-sharing rule. Here is how each piece fits your platform.
Book a Free CallDirect answer
A New York telehealth company needs three things before its first New York patient. Every treating physician needs a New York license, because the NYSED telepractice guidance requires full licensure for anyone practicing in the state and Public Health Law § 2999-cc makes the patient's location the originating site. The clinical entity has to be a professional corporation or PLLC owned by New York-licensed physicians under Business Corporation Law § 1507, because New York is a Strict corporate practice of medicine state. The MSO fee has to avoid the fee-sharing rule in Education Law § 6530(19). Foundry forms that MSO-PC for $15,000 one-time and matches a New York-licensed friendly PC owner for $3,000/mo.
For the full New York statute list and who enforces what, read New York CPOM. For the multi-state picture, start at the telehealth MSO-PC hub and the CPOM 50-state guide. General information only, not legal advice. Foundry is not a law firm.
The license question
New York follows the patient. Public Health Law § 2999-cc defines the originating site as wherever the patient is during the visit, and the distant site as wherever the clinician sits, which can be anywhere in the United States. The NYSED telepractice guidance says full licensure and current registration are required of any professional who practices in New York, unless an emergency order suspends that rule. Education Law § 6522 limits the practice of medicine to licensed physicians. So a physician in New Jersey who treats a patient at home in Brooklyn needs a New York license, even if the platform never opens a New York office.
Who owns the New York practice
| Role | Where it sits | Why |
|---|---|---|
| Physician owner | Owns the medical PC formed under § 1503 and § 1507, or a PLLC | Shares in a medical PC are limited to licensed physicians |
| Treating physicians, NPs, PAs | Employed or contracted by the PC, each licensed in New York | The PC is the entity practicing medicine and billing payers |
| Collaborating or supervising physicians | Signed to NP practice agreements or PA supervision where New York requires them | A separate job from owning the PC, with its own paperwork |
| Founder and investors | Own the MSO | The MSO owns the software, brand, and marketing, and bills the PC a fair-market-value fee |
The Education Department reviews medical PC and PLLC filings before they reach the Department of State. Start at the NYSED professional corporation filing page, and read the New York professional corporation timeline before you promise investors a launch date.
The fee-sharing rule and your MSA
Education Law § 6530(19) lists permitting any person to share in the fees for professional services as professional misconduct. It goes further than most states: it names arrangements where the payment for space, facilities, equipment, or personnel is a percentage of, or depends on, the physician's income from the practice. For a telehealth MSO, that points to a fixed or cost-plus fee for defined services, priced at fair market value and reviewed when volume changes. Payers pay the PC, and the PC pays the MSO's invoice. The CPOM compliance operating test and its MSA red-flag audit show what a diligence team checks.
Controlled substances
New York adds a state step to every controlled-substance prescription. Under Public Health Law § 3343-a, the prescriber must check the prescription monitoring program registry before prescribing a Schedule II, III, or IV drug, with narrow exceptions. Federal rules sit on top: the DEA's telemedicine flexibilities under 21 CFR 1307.41 run through December 31, 2026, and each prescriber needs a DEA registration. If you prescribe for ADHD, opioid use disorder, or ketamine care, see the behavioral health MSO-PC hub before you launch.
Setup steps for a New York telehealth company
- Map the visit types and mark which ones need a prescription and which involve controlled substances.
- Match a New York-licensed physician to own the PC ($3,000/mo).
- File the medical PC or PLLC through the Education Department review, form the MSO, and sign an FMV management services agreement with a fixed or cost-plus fee. See MSO-PC formation ($15,000).
- License every treating clinician in New York and sign NP practice agreements or PA supervision where required.
- Build the registry check into the prescribing flow for Schedule II to IV drugs.
- Enroll the PC with payers under its own tax ID and route all clinical payments to the PC's bank account.
Pricing
MSO-PC formation
$15,000One-time. The MSO and the New York physician-owned PC, scoped to your visit model.
Friendly PC owner
$3,000/moA New York-licensed physician who owns your PC.
New York telehealth MSO-PC FAQ
Do I need a New York license to treat New York patients by telehealth?
Yes. New York requires full licensure and current registration for anyone who practices in the state, and the Education Department applies that to telepractice. The patient's location is the originating site under Public Health Law § 2999-cc, so a physician in another state who treats a patient located in New York needs a New York license.
Can a lay founder own a New York telehealth practice?
Not the clinical entity. New York is a Strict corporate practice of medicine state. Business Corporation Law § 1507 limits shares in a medical professional corporation to licensed physicians, and the Education Department reviews the filing. The founder owns the MSO that runs the platform, paid a fair-market-value fee under a management services agreement.
Can an MSO charge a percentage of revenue in New York?
Be careful. Education Law § 6530(19) treats fee-sharing as professional misconduct, and it names payments for space, facilities, equipment, or personnel that are a percentage of, or depend on, the physician's practice income. A fixed or cost-plus fee set at fair market value is the safer pattern for a New York MSO.
Why does New York take longer to form?
Medical professional corporations and PLLCs in New York run through an Education Department review before the Department of State filing. That review often adds weeks compared with a 1 to 3 day filing in many other states. Plan the launch date around it.
How much does Foundry charge for a New York telehealth MSO-PC?
MSO-PC formation is $15,000 one-time. A New York-licensed friendly PC owner is $3,000/mo. Formation in many states takes 1 to 3 days after scoping, and New York usually takes longer because of the Education Department review.
Related reading
Ready to treat New York patients online?
Book a free 20-minute call with your visit model and states. We will scope the PC, the MSO, and the physician owner.
Book a Free Call