Closing a Medical Practice in California: What Applies

TL;DR — Key Takeaways

• Closing a medical practice in california is governed by fewer hard statutes than the checklists suggest, and the ones that exist are often cited for the wrong proposition. The most-cited retention statute, Health and Safety Code section 123145, opens by limiting itself to “Providers of health services that are licensed pursuant to Sections 1205, 1253, 1575 and 1726” – facility licensure categories, not an individual physician’s private practice.
• The retention rule that does reach a private practice is in the Medical Practice Act. Business and Professions Code section 2266 makes it unprofessional conduct to fail to maintain adequate and accurate records “for at least seven years after the last date of service to a patient.”
• The two rules have different triggers and only one carries the minors rule. Section 123145 runs seven years “following discharge of the patient” and requires records of unemancipated minors to be kept at least one year past age 18, and in any case not less than seven years. Section 2266 runs from the last date of service. A practice that satisfies one has not necessarily satisfied the other.
• No statute requiring a private medical practice to give patients notice of closure was located in the material reviewed for this article. The only hard statutory patient-notice deadline found anywhere in California healing-arts law is the dental one – 30 days, on a dentist’s death or incapacity, under Business and Professions Code section 1625.4(a)(3). The absence of a notice statute is not an absence of obligation, and the article says why. And for a licensed facility there is a statute with teeth pointed at the records rather than the notice. Health and Safety Code section 123145(b) lets “any person injured as a result of the licensee’s abandonment of health records” sue for the damage suffered, and where the licensee was a corporation or partnership that has dissolved, the injured person “may take action against that corporation’s or partnership’s principle officers of record at the time of dissolution.” Subdivision (c) defines abandonment as violating the seven-year duty and leaving patients without the access section 123110 gives them. Dissolving the entity does not dissolve that exposure, and the same licensure limit applies – section 123145 reaches providers licensed under sections 1205, 1253, 1575 and 1726, not a physician’s private practice.
• Record abandonment has a personal tail. Section 123145(b) lets the department or any injured person sue, and where the licensee is a dissolved corporation or partnership, “the person injured may take action against that corporation’s or partnership’s principle officers of record at the time of dissolution.”

The Direct Answer

Closing a California medical practice turns on records rather than paperwork. Business and Professions Code section 2266 requires a physician to maintain records seven years after the last date of service. Health and Safety Code section 123145 imposes a separate seven-year preservation duty on licensed facilities. Patient notice is a standard-of-care obligation rather than a general statutory one.

Closing a Medical Practice in California: What the Statutes Actually Require

Search this subject and you will find detailed checklists, most of them confident and many of them citing Health and Safety Code section 123145 as the California medical record retention rule. Read the section’s first line.

licensed providers that cease operation must preserve records for at least seven years after the patient’s discharge, and for an unemancipated minor at least one year past the minor’s eighteenth birthday, in no case less than seven years.

Those four cross-references are facility and clinic licensure categories. On the statute’s own words, section 123145 imposes the closure-preservation duty on licensed entities, not on every physician in private practice. This article does not characterise which facilities each of those sections covers, because they were not read.

That does not leave a private practice unregulated. It means the rule is somewhere else.

Business and Professions Code section 2266: failing to maintain “adequate and accurate records” of services to patients for at least seven years after the last date of service is unprofessional conduct.

That is a Medical Practice Act obligation enforced through the license rather than a Health and Safety Code duty enforced through the facility. It attaches to the physician and it survives the closure of the business.

The seven-year period in section 2266 is recent. The section was amended by SB 815 effective January 1, 2024, and the Legislative Counsel’s Digest for that bill records that existing law already made failure to maintain adequate and accurate records unprofessional conduct, and that the bill would specify that failing to maintain adequate and accurate records for at least seven years after the last date of service to a patient constitutes unprofessional conduct. So the duty is old; the period attached to it is not. Any retention policy written before 2024 predates the number.

What Notice Must Be Given to Patients When a Practice Closes?

Here is the honest answer, and it is more useful than the confident ones.

No statute requiring a private California medical practice to notify patients of a closure was located in the material reviewed for this article. Not in the Medical Practice Act sections read, not in the patient-records chapter of the Health and Safety Code, and not in the professional corporation statutes.

California does have one hard patient-notice deadline in healing-arts law, and it is dental. Business and Professions Code section 1625.4(a)(3) requires that, within 30 days after the death or incapacity of a dentist, notification be sent by mail to the last known address of each current patient of record “with an explanation of how copies of the patient’s records may be obtained.” There is no medical counterpart in the sections read.

Three things follow, and none of them is “notice is optional.”

Patients retain their access rights whatever the practice does. Health and Safety Code section 123110 entitles a patient or personal representative to inspect records “during business hours within five working days after receipt of the request,” and to a paper or electronic copy transmitted “within 15 days after receiving the request.” Those clocks do not stop because the practice closed. A closure that leaves nobody able to answer a records request is a closure that guarantees a violation.

Record abandonment is defined by reference to that access right. Section 123145(c): “Abandoned means violating subdivision (a) and leaving patients treated by the licensee without access to medical information to which they are entitled pursuant to Section 123110.”

And the exposure follows the people, not the entity. Section 123145(b) permits the department “or any person injured as a result of the licensee’s abandonment of health records” to sue for damages, and provides that where the licensee is a dissolved corporation or partnership, “the person injured may take action against that corporation’s or partnership’s principle officers of record at the time of dissolution.” Dissolving the entity is the step that creates the personal exposure rather than the step that ends it.

So the practical rule for notifying patients of practice closure california practices should follow is not statutory compliance but risk management: tell patients, in writing, where their records will be and how to get them, and keep that capability alive for as long as the retention period runs. The licensing boards publish expectations on this. Those are board guidance rather than law, no board document was read for this article, and none is cited here.

How Long Must Records Be Retained, and Who Becomes Custodian?

Seven years, from the later of the two triggers above, and longer for minors where section 123145 applies. The custodian question is the one that actually gets practices into trouble, because no statute reviewed for this article appoints one.

What the statutes do supply is a set of constraints the custody arrangement has to satisfy:

• Someone must be able to answer a section 123110 request within five working days for inspection and 15 days for copies, in the requested form and format if readily producible.
• Someone must be able to transmit X-rays and ECG, EEG or EMG tracings to another provider on written request within 15 days, which section 123110(c) treats as an alternative to copying them.
• The confidentiality duty survives the closure. Civil Code section 56.101(a) requires every provider of health care who “creates, maintains, preserves, stores, abandons, destroys, or disposes of medical information” to do so “in a manner that preserves the confidentiality of the information,” and makes negligence in doing so subject to the remedies in section 56.36 – including nominal damages of $1,000 per negligent release, as the statute reads at drafting, with no proof of harm required.
• If the practice is a professional corporation, the entity has its own clocks. Corporations Code section 13407 provides that where the corporation fails to acquire the shares of a disqualified shareholder within 90 days of disqualification, or of a deceased shareholder within six months of death, the certificate of registration may be suspended or revoked – and on suspension or revocation “the corporation shall cease to render professional services in this state.”

Two further points worth knowing before anyone hands a box of charts to a third party.

Board access to patient records is narrower than most people assume. Business and Professions Code section 2225(a) provides that the authority of the board to examine patient records in a physician’s office “is limited to records of patients who have complained to the board … about that licensee.” Section 2225(b)(1) allows inspection and copying of any document relevant to an investigation “where patient consent is given,” and (b)(2) allows inspection of documents relevant to business operations that do not involve medical records.

A vendor holding the records may be a CMIA provider in its own right – but not because it holds them. Civil Code section 56.06(a) reaches a business organized to maintain medical information only where it does so to make the information available to the individual or to a provider at the request of either, to let the individual manage that information, or for the individual’s diagnosis and treatment. In J.M. v. Illuminate Education, Inc. (2026) 19 Cal.5th 705, the California Supreme Court read that language as two real requirements and held that a vendor maintaining medical information for its institutional customers did not come within the definition. Custody of the records is not the test. A practice that wants its records vendor held to CMIA standards should bind it by contract, because the statute may not.

What Is Patient Abandonment, and What This Article Does Not Cover

No California statute defining patient abandonment for physicians was located in the material reviewed for this article. Business and Professions Code section 2234, the general unprofessional conduct section, was read in full. Its enumerated items are violating or assisting a violation of the chapter, gross negligence, repeated negligent acts with its own definition of “repeated,” incompetence, dishonesty or corruption, conduct that would have warranted denial of a certificate, and failure without good cause to attend a board interview within 30 calendar days of notice. Abandonment is not among them.

That does not make it harmless. It makes patient abandonment california exposure a common-law and standard-of-care question rather than a statutory checklist item – and California case law states the standard.

In Hongsathavij v. Queen of Angels/Hollywood Presbyterian Medical Center (1998) 62 Cal.App.4th 1123, the Court of Appeal put it this way at page 1138: “[a] physician cannot just walk away from a patient after accepting the patient for treatment,” and cannot withdraw without due notice and an ample opportunity to secure another attendant. The court added that “[i]n the absence of the patient’s consent, the physician must notify the patient he is withdrawing and allow ample opportunity to secure the presence of another physician,” and described those principles as well accepted and uncontested.

That formulation comes from Payton v. Weaver (1982) 131 Cal.App.3d 38, which supplies a useful picture of what discharging the obligation looked like on real facts: the physician gave the patient a list of the names and telephone numbers of every dialysis provider in San Francisco and the East Bay, and the court found there was nothing further he could have done in the circumstances.

So the test is not “did I file the right form.” It is whether, absent the patient’s consent, there was due notice and an ample opportunity to secure another attendant. In a practice closure that usually means continuing to see patients in active treatment through a defined wind-down, giving written notice with real alternatives rather than a generic referral line, and making the records path clear before the doors close rather than after.

Now the honest boundary of this article. A practice closure has a large operational surface that the statutes read here do not touch, and rather than guess, this article states what it does not cover:

• Employment. Final paychecks, accrued vacation, and mass-layoff notice are governed by the Labor Code, which was not reviewed for this article. No rule about them is stated here.
• Payors and enrolment. Medicare and Medi-Cal enrolment, change-of-ownership filings and payor re-enrolment are not addressed. The firm’s separate post on Medicare CHOW and payor re-enrolment covers that ground.
• Insurance. Tail coverage terms are a policy question, not a statutory one. The firm’s separate post on tail insurance and professional liability covers it.
• Leases and assets. Lease assignment, equipment finance and asset disposition are contract questions specific to the documents.
• DEA and controlled substances. Not addressed anywhere in this article.

Anyone selling rather than simply closing should start from a different place entirely, because a sale changes the records answer, the notice answer and the entity answer at once.

When to Bring Counsel In

Before the last patient is seen, and before the entity is dissolved.

The first moment matters because the sequencing is what creates or avoids abandonment exposure, and because section 123110’s clocks run from a patient’s request rather than from the practice’s calendar. Once the office is dark, a five-working-day inspection obligation is very hard to meet.

The second moment matters more than it looks. Section 123145(b) puts personal exposure on the “principle officers of record at the time of dissolution” where records are abandoned. Dissolution is the act that names those people. It should not happen before the records custody arrangement is real, documented, and funded for the length of the retention period.

There is also a reason to check a policy that has been in the binder a while. Section 2266 was amended effective January 1, 2024, and a retention policy drafted against section 123145 alone may never have engaged with the Medical Practice Act rule at all.

Related reading includes how to transfer a medical or chiropractic practice through a California probate estate, selling your California healthcare practice, healthcare practice valuation in California, Medicare CHOW and payor re-enrolment, tail insurance and professional liability, what the Moscone-Knox Act requires, California’s corporate practice of medicine doctrine, and a checklist for employees when a boss dies.

Work with Bay Legal

Bay Legal, PC advises California physicians and practice owners on practice wind-downs and transitions, records custody arrangements, professional corporation dissolution, and the difference between closing a practice and selling one. Call (650) 668-8000 in Northern California or (213) 668-8000 in Southern California, or schedule a consultation at https://baylegal.com/contact-us/.

Frequently Asked Questions

What notice must be given to patients when a practice closes?

No statute requiring a private California medical practice to notify patients of closure was located in the material reviewed for this article. The only hard statutory deadline of that kind in California healing-arts law is dental: 30 days on a dentist’s death or incapacity under Business and Professions Code section 1625.4(a)(3). Patients keep their Health and Safety Code section 123110 access rights regardless, so written notice of where records will be held and how to obtain them is the practical requirement.

How long must records be retained and who becomes custodian?

Seven years under both rules, with different triggers. Health and Safety Code section 123145 binds providers licensed under sections 1205, 1253, 1575 and 1726 for seven years following discharge, and requires minors’ records to be kept at least one year past age 18 and never less than seven years. Business and Professions Code section 2266 requires a physician to keep adequate and accurate records seven years after the last date of service. No statute reviewed appoints a custodian.

What is patient abandonment and how is it avoided?

No California statute defines it, and it is not among the enumerated items in Business and Professions Code section 2234, but the case law states the standard. Hongsathavij v. Queen of Angels (1998) 62 Cal.App.4th 1123, 1138 holds that a physician cannot withdraw treatment “without due notice and an ample opportunity afforded to secure the presence of another medical attendant,” absent the patient’s consent. It is avoided by sequencing: a defined wind-down for patients in active treatment, written notice with real alternatives, and a clear records path before closing.

What must be filed with the board, payors, and the state?

This article does not state filing requirements, because the statutes reviewed do not supply them and guessing would be worse than declining. Medicare and Medi-Cal enrolment and change-of-ownership filings are covered in the firm’s separate post on Medicare CHOW and payor re-enrolment. If the practice is a professional corporation, Corporations Code section 13407 imposes its own 90-day and six-month share-acquisition clocks and section 13408 governs suspension or revocation of the certificate of registration.

How should leases, staff, and tail coverage be handled?

These sit outside this article. Employment obligations on closure are governed by the Labor Code, which was not reviewed here, so no rule about final pay, accrued vacation or layoff notice is stated. Tail coverage is a policy question rather than a statutory one and is covered in the firm’s separate post on tail insurance and professional liability. Lease assignment and asset disposition are contract questions specific to the documents.