Health care professionals may form certain business arrangements.
Terms used in this Act mean:
One or more authorized licensees may form a professional corporation for the
purpose of rendering two or more kinds of professional services and services ancillary thereto. A
professional corporation may not employ a person who is an authorized licensee unless at least one
shareholder of the professional corporation is an authorized licensee of the same profession.
No professional corporation may provide any professional service or ancillary service
without a certificate of registration from the licensing board of each category of licensee who is a
shareholder. An application for such registration shall be made to the applicable boards in writing
and shall contain the name and address of the corporation, the information required in section 10
of this Act, and such other information as may be required by each licensing board.
Upon receipt of an application made pursuant to section 4 of this Act, each licensing
board shall investigate the proposed professional corporation. If the board finds that the
shareholders and professional employees within its jurisdiction are properly licensed and have no
disciplinary action pending before the board and if it appears that the corporation will be conducted
in compliance with the law and rules of the board, the board shall issue an annually renewable
certificate of registration upon payment of a registration fee in an amount to be established by rule
pursuant to chapter 1-26. The application for renewal of a certificate of registration must report any
change in status of the corporation or its shareholders. The corporation shall promptly report to any
licensing board having jurisdiction the occurrence of any event mentioned in subdivisions (1), (2),
and (3) of section 8 of this Act.
The certificate of registration issued pursuant to section 5 of this Act shall be
conspicuously posted upon the premises to which it is applicable.
Section 7. An application for an amended certificate of registration shall be filed with any boards having jurisdiction of the professional corporation any time the location or ownership of the professional corporation changes. The respective boards shall investigate the corporation to
determine whether it continues to meet the requirements of this Act. Certificates of registration are
Any licensing board having jurisdiction over a professional corporation may suspend
or revoke the certificate of registration issued under this Act for any of the following reasons:
In addition to providing the information required by the South Dakota Business
Corporation Act, the following information is also required in the forming documents of a
professional corporation, the organizing documents of a limited liability company, or the
registration documents of a limited liability partnership:
This Act does not authorize an individual to practice any profession, or furnish any
professional service, for which the individual is not licensed.
A professional corporation may exercise any powers accorded it by its generally
applicable governing law, so long as the professional corporation exercises those powers solely to
provide the pertinent professional services or to accomplish tasks ancillary to providing those
No professional corporation may adopt, implement, or follow a policy, procedure,
or practice, which would give any licensing board having jurisdiction grounds for disciplinary
action, cause a violation of professional ethics, or cause a violation of the professional duty to use
due care, against a shareholder or professional employee who follows, agrees to, or acquiesces in
the policy, procedure, or practice. Any licensing board having jurisdiction shall be notified of any
practice or policy adopted by the professional corporation that violates any provision of this Act.
Any dissension or deadlock resulting in a corporate policy or action violating the terms of this Act
shall be reported to any licensing board having jurisdiction. Any licensing board having jurisdiction
shall have access to any business records and any patient records relevant to the actions of its
This Act does not alter any law applicable to the relationship between a professional
licensee furnishing health care services and the person receiving those services, including liability
arising out of those services. To the extent required by the licensing or corporation law governing
any authorized licensee or professional employee, the corporation shall comply with the provisions
of such law relevant to the maintenance of professional liability insurance for those affected health
care professionals employed by the corporation.
Patient records shall be kept strictly confidential. No provision of this Act, including
interdisciplinary access to patient records by any stockholder, professional employee, or any
employee of a professional corporation, constitutes a waiver of any privilege on confidential
communications which otherwise exists under any provision of the law of this state.
The licensing boards having jurisdiction over professional corporations authorized
in chapters 47-11, 47-11A, 47-11B, 47-11C, 47-11D, and 47-11E are authorized to promulgate
rules pursuant to chapter 1-26 to implement the provisions of this Act, including the following