When closing a medical practice such as a doctor’s office, dental practice, or hospital, understanding the laws related to practice closure is vital. Every state has specific regulations governing how patients must be notified, how long medical records must be maintained, and more. Medical professionals must follow specific legal and ethical steps to ensure a smooth patient and staff transition. Failure to adhere to these requirements can lead to legal repercussions and patient care disruptions.
This guide provides a comprehensive overview of the legal requirements for closing a medical practice in New Jersey.
Key Requirements for Medical Practice Closure
Closing a medical practice is a multifaceted process that requires careful planning and compliance with legal obligations. Some items you will need to keep in mind, include:
Patient Notification
How and when will you notify patients of your intent to close your practice? Patients must be given adequate notice of the closure. This allows them to find alternative care providers.
Medical Records Management
Patients must be informed about how to obtain copies of their medical records. In many states, physicians are required to retain records for a certain period (e.g., seven to ten years) after the practice closes or to contract a medical records custodian to deliver records to patients for that time period.
Staff Considerations
Employees should be notified per labor laws, and any contractual obligations regarding severance or final paychecks must be fulfilled.
Regulatory Compliance
The practice must notify licensing boards, Medicare/Medicaid, and malpractice insurers of the closure. Additionally, the practice may need to formally dissolve as a business entity.
Disposal of Medications and Equipment
Prescription drugs and medical waste must be disposed of according to federal and state regulations to ensure environmental and public safety.
Financial and Legal Obligations
Outstanding debts, leases, and vendor agreements must be settled before closure. Legal counsel can help navigate any complexities.
Download a Checklist for Closing Your Medical Practice
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New Jersey Medical Practice Closure Laws
When closing a medical practice in New Jersey, healthcare providers must adhere to specific state laws and regulations to ensure a compliant and smooth transition for patients and staff.
New Jersey Patient Notification Requirements
Properly notifying patients of an impending practice closure is critical in New Jersey. State regulations require physicians to give patients sufficient advance notice so they can find alternative care and obtain their medical records, thereby preventing claims of patient abandonment. New Jersey Board of Medical Examiners rules mandate at least 30 days’ written notice to patients before the practice’s closing date. In practical terms, this means a doctor should send out written letters (on practice letterhead) to notify patients that he or she will stop providing care as of a certain date.
Key points for patient notification include:
- Timing: Send notification letters no less than 30 days prior to the last day of practice. Providing a longer lead time (60–90 days when possible) is often recommended as a courtesy, but 30 days is the minimum by law.
- Delivery Method: Notices should be sent via certified mail (return receipt requested) or a similar method that provides proof of delivery. Using certified mail ensures there is a record that the patient was informed, which is important for compliance.
- Who to Notify: It’s advisable to notify all active patients of the practice. New Jersey regulation specifically suggests making reasonable efforts to directly contact any patient seen in the 6 months preceding the closure. Many physicians err on the side of caution and notify patients seen in the past year (or longer for those with chronic conditions), but at minimum, those treated within the last 6 months should be informed directly.
- Letter Content: The letter should clearly state the date of closure (the last day the physician will be available to see patients). It should also provide information on how the patient can obtain their medical records or have them transferred to another provider (more on records handling below). If applicable, the notice might include contact information for a new practice or covering physician taking over care, but if no specific referral is provided, the letter can urge patients to begin finding a new healthcare provider as soon as possible.
- Emergency Care Obligation: Even after sending termination notices, a physician must be available to provide necessary emergency care or prescriptions to existing patients during the notice period up until the closure date. In other words, you cannot immediately abandon patient care upon mailing the letters – New Jersey requires that you address urgent medical needs that arise in that 30-day window. Fulfilling this duty helps ensure continuity of care while patients transition to new providers, and it protects the physician from allegations of abandonment.
- Optional Announcement: Although not explicitly required by NJ law for private practices, many physicians also post an announcement in their office and on their practice website or outgoing phone message regarding the closure. This can catch patients who may not have updated addresses on file or who did not receive the mailed notice. Additionally, as described below, New Jersey rules do require a published newspaper notice about the practice closing (focused on record retrieval), which also serves to broadly notify any patients who might have missed the direct letter.
In New Jersey, closure notifications need to be sent out at least 30 days prior to your closure date.
We recommend sending a physical letter, posting signage around your practice, and posting information about the closure on your website. It is essential that anyone who visits your practice or practice website can easily find the closure information.
A closure notification letter should include:
- The date of closure.
- The reason for closure (i.e., retirement, relocation, etc.).
- A forwarding address or phone number for questions after your closure.
- An authorization form for patients to sign so that their medical records can be transferred to a new practice.
- Information on patient record storage, including where the records will be stored, how to contact the storage facility, and any costs associated with patient record requests.
New Jersey Medical Records Retention and Access Requirements
New Jersey state law (via regulation and statute) requires that medical treatment records be kept for at least seven years from the date of the last entry. This 7-year rule applies to records of adult patients and, in the absence of a special rule for minors, it effectively applies to minor patients as well. The New Jersey State Board of Medical Examiners does not differentiate between minors and adults in its record retention regulation. However, because minors can bring certain legal claims for a period after reaching adulthood, it is prudent to retain a minor’s records until the patient turns 20 years old (which is age 18 plus the 2-year statute of limitations for medical malpractice) or seven years from last entry, whichever is longer. In practices with pediatric patients, this typically means holding on to those files beyond the 7-year mark if the child was very young at the time of last visit.
New Jersey regulations outline a physician’s duties to facilitate access to medical records, especially when a practice is closing. Before closing, a physician must establish a procedure for patients to obtain their records or have them transferred to a new healthcare provider. You should communicate this procedure to patients in the notification letter. Common approaches include either naming a medical records custodian (an entity or service that will take over storage and release of records) or arranging with another local practice to take custody of the charts. Whichever method is chosen, patients should be given clear instructions on how to request their records (for example, providing a phone number, mailing address, or web portal for record requests).
One unique requirement in New Jersey, when a practice is closing permanently or for an extended period, is to publish a notice in a newspaper about how patients can obtain their records. Under N.J.A.C. 13:35-6.5(h), a physician who stops practicing must publish an announcement in a newspaper of general circulation in the area once per month for the first three months after the practice closes. This notice should inform the public that the practice has closed and provide details on the “established procedure for the retrieval of patient records”. It should also state the location where the records will be permanently maintained (for example, “Dr. Smith’s patient records are stored with XYZ Records Custodian Company, [Contact Info]”). The purpose of this is to cover patients who may not have received the initial letter or who realize much later that they need their records – they might see the notice or know to check the local newspaper archives.
New Jersey requires that the physician send a copy of this published notice to the Board of Medical Examiners after its first publication (discussed more in the next section). Practically, many physicians will also post a similar notice on their practice website (if one exists) or leave an outgoing voicemail message with instructions for records retrieval, to further ensure patients can find the information.
If you don’t want to maintain responsibility for storing and fulfilling medical records requests, we can help. Learn more about our custodian of medical records services here.
For more details on New Jersey’s medical record retention requirements, consult the New Jersey State Legislature Website.
New Jersey Medical Board Notification Requirements
Besides patients, physicians should also consider what notifications or filings need to be made with licensing and regulatory authorities when closing a practice in New Jersey. The New Jersey State Board of Medical Examiners (NJBME) oversees physician licensing and practice regulations in the state, and it has a vested interest in how patient records are handled post-closure.
Submitting Closure Notice to the Board: As mentioned earlier, New Jersey regulation requires that when a physician closes a practice (ceasing practice for more than 3 months), the doctor must publish a notice in the newspaper regarding patient records. The rule also mandates sending a copy of that notice to the NJBME once it’s published. This effectively notifies the Board that you have made provisions for your medical records. The Board may keep that information on file in case patients contact them looking for records or if any issues arise. Fulfilling this requirement is important – failing to do so could be considered a breach of the Board’s regulations. In practice, after you publish the first newspaper notice, you would mail or fax a copy of the printed notice (and perhaps a cover letter) to the Board office, referencing the regulation and your license number. It’s wise to do this promptly after the first publication so that you square away your Board notification duty.
License Status and Updates: If you are retiring or taking an extended leave, you should inform the Board regarding your medical license status. New Jersey licenses must be renewed every two years, and there are options for inactive or retired status. An “inactive” or “retired” physician’s license in NJ does not require renewal fees or continuing medical education, but also does not permit the practice of medicine or prescribing while in that status. Many retiring doctors choose to officially go into retired license status. To do so, one typically indicates on the biennial renewal form (or an application to the Board) that you wish to be placed in retired status. This is a voluntary notification – it’s not mandatory to retire your license if you close your practice (some physicians keep an active license even after closing their own office, in case they do part-time work or just to maintain credentials). If you remain licensed, you will need to continue renewing and meeting CME requirements, so this is a personal decision. From the Board’s perspective, no separate immediate “closure” notification form is required beyond the records notice submission and the normal license renewal process. However, you must ensure the Board has your updated mailing address. New Jersey law requires licensed physicians to update their address of record within 30 days of any change. So, if your practice address was your address of record, you’ll need to provide a new contact address to the Board (such as a home or P.O. box) after the practice closes.
Other Notifications: While the State Board is a primary point of contact, there are other organizations to notify when closing a practice:
- Drug Enforcement Administration (DEA): If you hold a DEA registration for prescribing controlled substances, you should notify the DEA of your retirement or practice closure. Typically, the DEA asks physicians to surrender their DEA certificate if they will no longer need it, and to properly dispose of any unused prescription blanks and controlled drug inventory. The Wilentz law firm guide recommends writing to the DEA’s regional office and enclosing your DEA registration certificate and any unused DEA Schedule order forms, marked “void”.
- NJ Drug Control Unit: New Jersey has a Drug Control Unit (under Consumer Affairs) that also can be informed regarding surrender of controlled substance registration at the state level. They can provide instructions for disposing of or transferring any controlled substances on hand.
- Insurance Payers: It’s important to notify Medicare, Medicaid, and any private health insurance plans or HMOs you contract with that you are closing your practice. Some insurer contracts actually stipulate a required advance notice (sometimes 60 or 90 days) to the insurer and patients in their plan. Complying with those terms will ensure you don’t inadvertently breach a payer agreement. You’ll also want to arrange final billing or claims submissions and update your Medicare enrollment (e.g., terminating your Medicare PTAN if retiring completely).
- Medical Malpractice Insurer: Physicians should inform their medical liability insurance carrier about the practice closure. This is critical for arranging “tail” coverage if you’re retiring (extended reporting period coverage for any future claims). The insurer can guide you on any policy changes once you stop seeing patients.
- Professional Organizations: You might also inform hospital medical staff offices (if you have privileges) that you’re resigning or changing status, and any medical societies or boards where you hold memberships or certifications.
While these additional notifications go beyond the NJBME’s direct requirements, they are all part of a comprehensive practice closure plan. The Board’s core requirement remains: ensure that patients will have access to their records and let the Board know that arrangement by submitting the notice. Also, if any official complaints or inquiries come up after you close, be responsive – closing a practice doesn’t entirely end a physician’s responsibilities, as patient complaints or Board communications may still require attention. Keep your contact information current with the Board so that you can address any loose ends after closure.
Additional Resources for Closing Your Medical Practice in New Jersey
To get up-to-date information about medical practice closure laws and requirements in New Jersey, please see these additional resources:
How Desert River Solutions Can Help
Desert River Solutions is a trusted medical records custodian serving healthcare providers nationwide. Our services include:
- Electronic medical record extraction for seamless digital transition.
- Document scanning and storage for secure retention.
- HIPAA-compliant record management and destruction.
- Patient record request fulfillment, ensuring continuity of care.
Managing medical records retention is a critical aspect of healthcare compliance. Whether you’re closing a practice, transitioning to digital records, or ensuring legal compliance, working with a trusted medical records custodian can save time and reduce risk.
At Desert River Solutions, we help healthcare providers in New Jersey and beyond with secure, HIPAA-compliant medical records storage and management. Need help with medical records retention in New Jersey? Contact Desert River Solutions today!
Legal Disclaimer: the information contained in this site is provided for informational purposes only, and should not be construed as legal advice on any subject matter.
