Tennessee and most states ban the "corporate" practice of medicine. In Tennessee, that ban is part of a statute – Tennessee Code Annotated section63-6-204. Because of that ban, a corporation cannot lawfully employ physicians. That is why Wal-Mart/Walgreens use nurse practitioners or physicians assistants in their clinics.
There are some exceptions. For example, hospitals can and do employ doctors. Businesses can employ "company" doctors who treat only employees or retirees of the business and their dependents.
Of course, doctors need the limited liability protection that a corporation or LLC provides. Therefore, most states, including Tennessee, allow professional corporations and professional limited liability companies. These PCs and PLLCs can only be owned by persons licensed to practice medicine or licensed in other complimentary healthcare fields. Likewise, the executive officers are limited to persons licensed in those fields.In Tennessee, the owners of a physicians practice entity may include physicians, osteopathic physicians, podiatrists, optometrists, chiropractors, and physicians assistants. Tenn. Code Ann. § 48-101-610.
So, that is why Wal-Mart does not employ doctors. More importantly, that is why any entity in which a physician practices must be a PC or a PLLC.
Some people mistakenly believe that a corporation with “S” status is the same as a PC.Subchapter S election is an election for federal income tax purposes. Any corporation that meets certain minimum requirements may elect Subchapter S status. That election means that the corporation's income for federal income tax purposes is attributed to its shareholders. The PC designation is a different designation.
