California NP Practice Ownership in 2026: What 103 NPs, 104 NPs, and Standard NPs Need to Know

Quick answer

NP legislation (AB 890), signed into law in 2020 with expanded provisions beginning January 2026, created new pathways for California Nurse Practitioners to practice with greater autonomy. In doing so, it established two new NP certification tiers alongside the existing NP framework, giving California NPs three distinct categories under which they can practice.

This guide outlines what each tier means, as well as what the California Board of Registered Nursing has confirmed about ownership and practice structure, and what 103 NPs in particular need to understand before deciding how to set up their practice.

California’s Three NP Certification Tiers: Standard NP, 103 NP, 104 NP

AB 890 (Cal. Stats. 2020, Ch. 265) created Article 8.5 of the Business and Professions Code, establishing two new certification pathways. Combined with the existing standard NP framework, there are now three tiers:

Standard NP

Practices under standardized procedures with a collaborating or supervising physician. This is the baseline framework that preceded AB 890 and remains the path for NPs who have not obtained 103 or 104 NP certification.

103 NP (Cal. Bus. & Prof. Code § 2837.103)

A transitional certification for NPs who have completed the required experience in California. Under this pathway, a qualifying NP may perform clinical functions without standardized procedures, within specific settings. Importantly, a 103 NP still requires a collaborating physician.

The statute requires completion of:

Cal. Bus. & Prof. Code § 2837.103(a)(1)(D)

“a minimum of three full-time equivalent years of practice or 4,600 hours” of transition to practice in California.

104 NP (Cal. Bus. & Prof. Code § 2837.104)

Full practice authority. A 104 NP meets all 103 NP requirements plus an additional three years of practice experience as a 103NP. Once recognized as a 104 NP, no collaborating physician is required and no standardized procedures are required.

Can a Standard NP, 103 NP, and 104 NP Own a Practice in California? Yes. Here’s the Structure.

A note before getting into the specifics: a Nursing Professional Corporation can be 100% owned by a Nurse Practitioner. A Medical Professional Corporation requires 51% physician ownership. The structures described below are all Nursing PCs, regulated by the California Board of Registered Nursing. For more on the differences between Nursing Corporations and Medical Corporations see Do Nurse Practitioners Need a Physician Owner?.

Standard NP

May fully own a Nursing Professional Corporation (PC) in California under Cal. Bus. & Prof. Code § 2775. Practices within the entity under standardized procedures with a collaborating or supervising physician in place.

103 NP

A 103 NP may fully own a Nursing PC. However, based on recent guidance from the California Board of Registered Nursing (April 2026), a 103 NP must practice as a “Standard NP” within their own Nursing PC entity.

That means that a 103 NP who owns a Nursing PC must practice within that entity as a standard NP, with standardized procedures and a collaborating physician in place. This is the current confirmed position from the California Board of Registered Nursing.

Bottom line: A 103 NP can own a Nursing PC. They just cannot use their 103 NP certification status within it. They practice as a standard NP with standardized procedures and a collaborating physician.

104 NP

May fully own and practice within a Nursing PC. No collaborating physician is required and no standardized procedures are required, making this the most autonomous structure available to California NPs.

Please note that 104 NPs still need to maintain a referral plan and to consult with physicians in specific clinical circumstances. See section “What 104 NPs Should Be Aware of in California” below for details.

If You Want to Reach 104 NP Status Faster, Read This First

This is an important planning consideration for any 103 NP whose goal is to reach 104 NP status.

If a 103 NP owns a Nursing PC and practices within it as a Standard NP under standardized procedures, those hours do not count towards their 104 NP certification requirements. The California Board of Registered Nursing has confirmed this: only hours practiced under the 103 NP framework, in qualifying settings, count towards the path to 104 NP status.

For 103 NPs who want to own their practice and accrue hours toward being a 104 NP in that setting, a dual entity structure or Management Services Organization - Professional Corporation (MSO-PC) structure offers a path to do both. In an MSO-PC arrangement, the 103 NP can practice under the 103 NP framework in a qualifying setting, with the MSO layer providing business infrastructure.

That said, an MSO-PC is significantly more complex and expensive to set up and to maintain than a standard Nursing PC. NPs should weigh the cost and complexity against the timeline benefit of reaching 104 NP status sooner.

Bottom line: A Nursing PC is much simpler and less expensive to set up and run. An MSO-PC allows 103 NPs to accrue hours toward 104 NP status while owning their practice. The right choice depends on your goals and timeline.

What 104 NPs Should Be Aware of in California

While 104 NPs do not need a collaborating physician or standardized procedures, California still imposes specific obligations:

• Referral plan. 104 NPs must maintain a plan for referral of complex medical cases and emergencies to a physician, surgeon or other appropriate provider.
• Consultation and collaboration. 104 NPs must consult and collaborate with other appropriate specialty providers based on the clinical condition of the patient.
• Physician consultation in specific circumstances. 104 NPs are required to obtain physician consultation in the following situations:
  • Emergent conditions requiring prompt medical intervention after initial stabilizing care has been started
  • Problems not resolving as anticipated after ongoing evaluation and management
  • History, physical, or lab findings inconsistent with the clinical perspective
  • Upon request of the patient

While 104 NP status grants the most autonomous practice authority available to California NPs, these obligations remain in place, and are important to be aware of.

Conclusion: Know Your Tier. Structure Your Practice Accordingly.

California NPs have real options for practice ownership at every certification level. The right structure depends on your current certification and your goals.

Prax Health helps NPs set up both Nursing PCs and MSO-PCs, and works with external healthcare legal counsel to provide clear, accurate, and objective guidance.