Life can be complicated, especially for physicians in private practice. Leaving aside for a moment the specter of professional liability arising from claims of malpractice, today’s physicians must be adept at navigating a variety of non-medical challenges that represent significant aspects of their professional lives.
So where to turn? Professional risk managers may be an important resource for certain questions, but for attorney Christopher Keay of Johnson, Graffe, Keay, Moniz, and Wick, the counsel sought by his physician clients ranges from professional relationships, employment issues, fraud prevention, and equipment and building leases to practical concerns such as the death of a member/partner or the impact of divorce upon their clinic—whether their own or a partner’s.
“Most professionals—physicians or otherwise—can benefit from having a ‘go to’ attorney resource,” says Keay. “Physicians have studied and worked hard to achieve their professional goals of helping and healing, but they might not have specific training or experience in some of the practical aspects of starting or maintaining a medical practice. Sometimes they forget that not everyone shares their goal or perspective. They are focused on delivering medical care, not always the practical matters that keep them safe from legal entanglements.”
The value of having a trusted relationship with an attorney, someone who knows you and your life (professional and personal), is that you’ll have someone who can help manage some practical aspects of your legal needs or refer you to other professional resources you may require. Just as in medicine, there are specialists in different areas of the law—tax, corporate partnerships, family law, real estate, state and federal regulatory compliance, etc. A key legal adviser can help direct you to the right resource or combination of resources for the best possible outcome. When you allow yourself to rely upon other experts, you can focus on the expertise for which you have been trained.
The following is a short list of non-medical liability issues a physician may contend with:
Personnel issues include conflicts with and between staff around pay, hours, benefits, work rules, and/or termination considerations, etc. Many times, these issues are delegated to an office manager or a lead employee who needs to manage the situation. Sometimes this works out fine; other times, not as well. Regardless of whether a clinic is large or small, personnel issues can escalate to such a level that a lead physician or manager may not know how to direct the problem to the satisfaction of all parties, leaving the clinic or individuals exposed. It is most prudent to err on the side of reaching out for legal support sooner rather than later, before a situation becomes unsalvageable.
PREMISES AND PROPERTY
The liability around clinic property is a broad topic in itself. An attorney can help you identify a variety of future scenarios you’ll want to consider as you sign off on commitments. For instance, a bad lease can stay with you many years. You’ll want to make sure you’ve negotiated an office lease that includes a renewal clause or other options that will serve you well as your clinic needs shift.
An issue that is far more common than people would realize is embezzlement—when clinic property or resources are stolen by an employee or partner. The most common occurrence is when one employee or partner is responsible for receiving the mail, opening the mail, making deposits, and writing the checks to pay the bills, which can easily be falsified. Another instance is when cash co-pays are received and then pocketed. These kinds of scenarios occur when too much trust and responsibility is given to one person and there is little to no oversight. A reasonable checks-andbalances system to have in place, for instance, would be to have one person authorized to write the checks and another authorized to sign the checks. Says Keay, “I have a client who experienced three embezzling bookkeepers in a row before calling me. Management always seems surprised to find their trust violated.”
A short summary of common property issues requiring legal assistance includes:
- Real estate—the lease or purchase of property
- Equipment—the rental or purchase of equipment necessary to successfully do your job
- Embezzlement—how to avoid it and what to do when it happens at your clinic
- ADA compliance—managing issues around accessibility laws for which you may have responsibility, but limited expertise
PARTNERSHIP AND MEMBER AGREEMENTS (OR DISPUTES)
Practices are dynamic. The needs, goals, and motivation levels at the start of a professional relationship may be profoundly different than at the end of a relationship. At the rosy outset of a relationship, partners often don’t want to think through the possible changing needs of partners. Developing successful agreements includes objective, long-term thinking and planning for a variety of outcomes that might crop up, such as purchases, sales or mergers of clinics, or the impact of a death or divorce of a partner. The foresight and experience to know what situations can crop up will help create the most clear partnership documents when changes take place.
Also, younger physicians often ask about a demonstrated path to partnership. With this in mind, some additional considerations for agreements include whether a member is or can become:
- An equity partner vs. non-equity partner
- A junior partner vs. a senior partner with voting rights
The sale of a practice (or a percentage buyout) at the end of a career is likely the most complex transaction a physician will ever face. The agreement—and its impact on related others— should be carefully considered with the help of an experienced professional. Legal counsel who is able to prepare the appropriate documents may start with a boilerplate document but may also explore the many customizable options possible in order to pin down clear executional details. A successful exit strategy may be 12–18 months in the planning; don’t make the mistake of investing time in this pivotal stage of your career without legal support.
Most physicians have met that stubborn patient who has long avoided going to the doctor when what they need most is the care of a professional. Similarly, make sure you’ve covered your bases and that you get the legal help you need to keep you in the exam room and out of the court room.