First, an independent contractor is someone who is technically 'independent' from the group. He or she renders medical services based on a contract with the group. They are not technically employed by the group and there's a difference.
An employee of the medical group is required to adhere to and follow any rules, policies and procedures of the medical group. They take vacation only when the group says they can. They usually have no financial interest in the medical group except to get a paycheck for work they performed. They will usually receive a W2 tax form at the end of the year.
An independent contractor typically has no one supervising his or her activities. An employee, on the other hand, will usually have a supervisor who is technically responsible to oversee the employee.
A key difference between an employee and independent contractor is that if an employee is found to be careless or negligent, then that carelessness is imputed to the medical group. That is known as a vicarious liability. In other words, the employer is directly responsible for the acts of the people who work for them.
In contrast, an independent contractor's actions are not directly attributable to the medical group simply because he 'works' there.
An independent contractor receives a 1099 at the end of the year. They usually are not supervised by the medical group. They will often bring their own medical instruments to be office when they work; they decide when to take their own vacation; their name will not appear on the medical bills or office door. In fact, there is an entire checklist that the IRS uses to determine, from a tax standpoint, whether someone is an independent contractor or employee.
An independent contractor often will have their own medical malpractice insurance and will not be covered by the groups' malpractice insurance.
To learn more about this topic, I invite you to watch the quick video below...
