Moving Your Practice

Navigating Troubled Waters: Five Tips for Physician Practice Breakups and Departures

February 24, 2014 | Little Health Law

Medical practice breakups and physician departures are inevitable. Some are the result of professional or personal disputes, and others are simply the result of practical or economic realities or life events (disability, death, retirement, etc.). Whatever the circumstances, failing to carefully execute a plan for the breakup can quickly result in financial, legal, and emotional complications. All physicians and physician practices should anticipate the inevitable conclusion of any professional relationship.

1. Have a Good Contract

When a business relationship fails or otherwise ends, not having a properly done contract that fairly, accurately and precisely sets forth the parties’ respective rights and obligations will be a painful mistake, financially and otherwise. At the beginning of the marriage (or at least during the period that it is happy), the parties should carefully and thoughtfully construct a written agreement that states their meeting of the minds. That contract should also specifically set forth in reasonable detail a road map for the parties to separate when it is time for the relationship to conclude.

2. Carefully Document the Termination of the Relationship

Whether or not the practice had proper preparation before a breakup or departure, both parties should carefully document the final resolution in writing. This is especially the case if the resulting departures necessitate any post-employment obligations such as unfinished payments, restrictive covenants, confidentiality agreements, etc. Important practice contracts and documents should be marshalled and carefully reviewed to determine what the parties’ respective rights and obligations will be in concluding the relationship, including:
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The Affordable Care Act Will Enhance Direct Practice Medicine Opportunities

December 28, 2013 | Little Health Law

The Affordable Care Act (ACA), widely known as “Obamacare,” will create new opportunities for primary care doctors (and some specialists) who weigh starting or converting to a direct primary care model. At first blush direct care medicine practices, also known as “concierge,” “boutique” and “retainer-based” practices, which charge patients a monthly or annual membership fee and tend to exclude (or limit) third party payer involvement (one of the strong points for pursuing the model), would seem limited as an opportunity by the ACA’s objective of getting everyone “insured.” But the opposite may prove to be the case. Actually, the ACA may drive a strong need for new concierge medicine doctors.

A New Era of High Deductibles

While a stated goal of the ACA is to decrease the number of uninsured Americans, a consequence of the ACA will likely be that many newly insured patients under plans obtained via the new insurance exchanges will soon realize that due to very high deductibles, much or all of the costs of treatment (i.e., all non-preventive care) incurred over the course of a year must be paid out of pocket by the insured. For a typical household in Richmond County, Georgia, for example, as of this writing there are 18 plans available via the exchanges: 7 “Bronze Plans,” 6 “Silver Plans,” 4 “Gold Plans,” and 1 “Platinum Plan.” For the Bronze Plans, the annual deductibles range from $4,000 to $6,300. It is widely expected that most people will seek to minimize their premiums and opt for one of the Bronze Plans, only two of which have annual deductibles of less than $5,000.

What will that mean? That will mean most doctor visits (excluding preventive care) will be paid out of pocket by the “insured” patients who presently may not realize what is in store for them by way of doctor bills. As the public becomes aware of how the ACA will actually work for them (i.e., even though they are “insured” they are writing checks for doctor bills), the appeal to consumers of concierge options will increase. As recently reported in the Wall Street Journal, “People with deductibles of $5,000 or more should think about how many times a year they typically see the doctor and for what, keeping in mind that annual checkups are free under the ACA. If doctor visits typically cost $150 and the patient has six appointments a year, a concierge practice offering the same services for $40 or $50 a month might be cheaper.” Pros and Cons of Concierge Medicine (November 1, 2013).
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Breaking Up is Hard to Do: Dividing Medical Practice Assets

November 28, 2013 | Little Health Law

Ending a professional relationship is not easy for anyone. But the demise of a healthcare business relationship among doctors often involves more risks, greater headaches, and more issues to tackle than non-healthcare businesses. Dividing up medical business assets is, for example, much more complex and involved than simply drawing a line down the middle of the office. Federal laws and regulations affecting healthcare providers pose significant business risks and adverse legal ramifications where the division of assets is not done properly. If you and other physician owners are leaving a practice, it is critical to ensure any division of big ticket items — e.g., medical equipment leases, practice branding, and electronic health records – is done in a legally compliant manner.

Most often, medical equipment in physician practices is leased. The leased status creates potential complications if multiple owners want a particular item or if, on the other hand, no one wants the accompanying financial obligations. Whichever side of the coin your practice breakup falls on, medical practice owners should take into account the depreciating value of the equipment when determining the division of assets. Sometimes, outstanding liabilities or personal guarantees that equipment may be subject to are mistakenly overlooked in the process of dividing assets. The division process should begin with an experienced consultant who can aid in the necessary number crunch and ensure fair and balanced allocation of value and financial responsibilities that attend leased equipment assets.

While a practice’s name and brand may not be easy to value with precision, the inherent value should be weighed and factored into the division of assets. As with any business, the reputation of a brand or identity is a key to success. A medical practice’s good reputation carries critical patient confidence, which is a valuable asset for any practitioner. When physicians choose to work in the same field and geographic area, the division of such an asset is problematic and may raise difficult business and legal issues.
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Things to Consider When Moving Your Medical/Dental Practice

January 31, 2013 | Little Health Law

Physicians and dentists often decide to choose a new place to practice. Sometimes it might be in the same area but a different part of town or it can be in another city or state. Whether you are considering opening a new office or simply relocating, it is extremely important to do your homework before making this decision.

Here are a few tips from an experienced Georgia health care lawyer to consider.

One of the primary factors in making this decision is physician density. In areas where there are not as many doctors, it will be far easier to cultivate a new patient base. This is especially true if there are no physicians in the area with your expertise. In areas saturated with doctors, you are provided with the opportunity to expand your area of expertise and set yourself apart from the others.

Another thing to consider is an area with high unemployment. This would mean the people in that area would be less likely to have insurance coverage. This would make them less likely to make routine visits. This may all change under the Patient Protection and Affordable Care Act (PPACA).

Nobody really wants to talk about the costs involved for medical malpractice but it is a decision that has to be faced if considering a move. If you are moving in the same city or same area, this is not of significant concern. However, if you are considering moving to another state or a smaller town, the costs of malpractice insurance could vary greatly.

Lastly, consider what your earnings will be in the area you are considering. Physician compensation in the Midwest is higher than the Southwest. In reality a reputable physician can make a good living in any area he or she chooses to go to. One way to get inside information is to visit with other doctors in the area considering that they might not be entirely honest with their answers.

Unfortunately there is no cookie cutter format for determining the best place for a physician to be; there are issues specific to each practice that will need to be answered. The bottom line is that an experienced physician or dentist will flourish and succeed in any area that they choose.
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