Is There a Doctor on The Plane?

During the summer travel season, I will usually get a few calls from doctor clients who have responded to a medical emergency while on an airplane.  If the patient doesn’t make it or later develops severe complications, the doctors are concerned that they may have incurred liability for providing care.   They need not worry.  Good Samaritan laws provide a shield from liability when a doctor happens upon an accident or ill person and volunteers to provide care without compensation.

Yesterday, the New York Times had a piece on just how much the airline industry actually relies on the medical community to come to the aid of fellow passengers in emergency situations.  Some doctors interviewed even pack drugs and other items and equipment so they are prepared in case they are called upon for professional assistance.

Its an interesting read so go check it out.  And pack accordingly for that trip to the beach this summer.

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Harvard Says Train Medical Students and Residents Like Seals

In the wake of the spectacular work of Navy SEALS to locate and kill Osama Bin Laden, the training regimen and methods of that elite group have received quite a bit of attention.

Now researchers who recently presented their findings at Harvard Medical School are saying that the type of resiliency in the face of constant stress that is taught to Navy SEALs can also benefit medical students and residents during their training.

According to their findings, researchers say that emotional resiliency can be taught and the effects of chronic stress reversed. The best predictor of immunity to stress, is a strong social support network. Optimism (including faith in a higher cause or power), perseverance (work ethic), responsibility and integrity also count.

For my money, our nation’s doctors are just as good as our Navy SEALS at the work they are asked to do.  But if borrowing from the outstanding training methods of the military’s elite units will make doctors even better, medical schools and residency programs should take heed and adopt them.

Posted in Residency Programs | 1 Comment

Family Practitioner Profiled in NY Times

Over the weekend the New York Times did an insightful but somewhat sad profile of Dr. Ronald Sroka, who is a family practitioner in his hometown of Crofton, Maryland. The piece is part of s series titled Doctors, Inc.–A Wrenching Transition.

The article and a short accompanying video tell of Dr. Sroka’s ongoing challenges of operating his practice as a sole practitioner as costs rise and reimbursements for his services declines. Dr. Sroka would like to retire but can’t find any physicians who are willing to take over his practice and the 4,000 patients, most of whom he has treated for an average of 20 years.

The article goes on to discuss the reasons for Dr. Sroka’s predicament: market pressures and lifestyle choices that lead many younger physicians to opt for practice in larger groups or seek employment with hospitals or health systems. This is the future of health care and its kind of a shame.

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Critical Terms in Physician Employment Agreements, Part III

Ed. Note.  Welcome to the third and final installment in a series analyzing the critical terms in physician employment agreements.  Part I can be found here. Part II can be found here here.

Post Employment Covenants

Given the growing competition that health care providers face, hospitals and group practices that employ physicians generally attempt to include strong post-employment restrictive covenants on physicians. The parameters of what is allowed are generally a matter of Illinois statutes and case law and the post-employment restrictive covenants should be reviewed by an attorney as they can significantly limit the opportunities available to a physician following a termination of employment. The post-employment restrictive covenants employers typically try to secure are: non-competition, non-solicitation of patients and employees and non-disclosure of confidential information.

1.            Non-Competition with Employer

Employers will commonly attempt to include a provision in the physician employment agreement stating that during the period of time the physician is employed and for some period of time (commonly two years) thereafter, the physician will not work for any other medical practice or healthcare provider that competes in the same geographical area as the employer.

The non-competition provisions of a physician employment agreement should be carefully reviewed to ensure that any restrictions on a physician’s ability to practice following the termination of the employment are reasonable in their length and geographic coverage. Moreover, the non-compete provision can only apply to those services actually provided by the employer and where it has a legitimate business interest to be protected by precluding the physician from competing with the employer for the stated period of time following the termination of employment.

While not directly prohibiting them, Illinois courts have hinted recently that non-compete provisions in physician employment agreements may unduly restrain trade and hinder access to care and that there are sound public policy reasons to allow the physician-patient relationship to continue following a termination of the physician’s employment, even if that patient relationship does compete with the previous employer’s business interests. This area of law will continue to evolve and bears close watching by physicians as courts and public policy makers continue to struggle with issues of patient access and competition in the healthcare marketplace.

2.            Non-Solicitation of Employer’s Patients and Employees

Healthcare employers want to protect their employee and patient relationships and will often insist that as part of the employment agreement, the physician agree not to solicit the patients and employees of the employer upon the physician’s departure.

3.            Confidentiality and Non-Disclosure

Along with the privacy rights of patients, employers often seek to safeguard confidential information related to their business operations. As part of the employment agreement with a physician, an employer will often require a physician to agree not to disclose or make accessible to anyone any confidential information of the employer. The type of information covered under such a provision includes pricing or business strategies, compensation or financial information, patient lists, patient files, patient records, charge data, price lists, contract forms and other books, records or files relating to the employer’s business operations.

Miscellaneous Provisions

1.            Governing Law

The state law where the employer is located will govern the interpretation of the employment agreement. This may seem an obvious point, but a physician relocating into a new state will have to become familiar with the important concepts of employment law, such post-employment restrictive covenants, in the new state.

2.            Alternative Dispute Resolution

Some commentators urge physicians to agree to alternative dispute resolution (“ADR”) procedures in an employment agreement. However, there is increasing body of thought that suggests that ADR might be just as time-consuming and expensive as going to court to interpret or enforce the terms of an employment agreement. Before agreeing to this provision, an attorney should carefully explain to the physician the benefits and drawbacks to including an ADR provision in the employment agreement.

Conclusion

As a physician’s practice develops and partnership is realized, the employment agreement should be negotiated and interpreted along with related agreements entered into between the physician and their new partners, such as shareholder/partnership and buy-sell agreements, and deferred compensation arrangements.

Regardless of the stage of a physician’s career, a physician should take control of the process of negotiating and documenting his or her employment agreement by consulting other trained professionals such as attorneys and accountants to ensure that the final result suits the physician’s professional and financial goals. Entering into an employment relationship also means that a physician should conduct due diligence on the prospective employer and inquire of colleagues and other informed sources on the reputation of the employer and the management style of its leadership.

In the end, employment agreements are the result of some give and take by both the physician and the employer, and when finally documented, accurately reflect the goals and intentions of the parties. Upon their completion and signature, the best employment agreements are filed away and only consulted in rare instances, if a process of open and candid communication was established by the parties during the recruitment and negotiating period. A well-drafted employment agreement provides the physician with a solid foundation for building professional and financial future, but to sustain a strong and mutually productive relationship with the employer over long period of time, a physician also needs to be a trusted colleague and a strong and informed advocate on his or her own behalf.

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Check back for future posts when we explore the negotiating process for physician employment agreements.

Posted in Physician Employment Agreements, Restrictive Covenant/Covenant Not to Compete | Leave a comment

Marathoners Need Doctors!

When I tell people I have started and completed 8 marathons they usually stare at me quizzically or just laugh out loud. But its true and somewhere in the boxes my wife made me store up in our attic along with my Little League baseball and soccer trophies, I have the medals to prove it.

After a period of time away from the sport (that period includes all of George W. Bush’s second term and half of Barack Obama’s current one), I am getting back into it. Maybe I won’t do any more marathons, but I am already doing more recreational running and have some 5k and 10k’s on the calendar for the spring and summer.

When I was doing marathons, it always brought me a great deal of comfort seeing doctors and other members of the medical team along the race course. Thank goodness I never needed their physical help. But in many cases their shouts of encouragement and thumbs up gave me the confidence to trudge on knowing that even if I felt like I was going to fall over, a trained set of eyes had given me a once over and decided I didn’t need to be pulled from the course and taken to an ambulance. Other of my fellow runners didn’t fare as well but the well-trained medical teams were always there to provide on the spot care and transport the runner to the hospital if the situation required it.

So now I urge you good physician readers of this blog to do your duty and find a marathon or other race in your area and volunteer to be a member of the medical team. As if there weren’t enough specialty and sub-specialty medical societies out there, I found one for doctors that specialize in providing care at road races.

So c’mon doctors! We back of the pack runners need you on race day! It’s not enough to just tell us to exercise more and try to lose some weight when we sit in your examining room, when we actually get out there and try to do it, we need your support then too. I guaranty you will have a lot of fun and maybe be inspired to take up running if you don’t do it already.

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The Record Number of CMS Regs Currently In The Pipeline

Before any federal agency regulations can be issued, they are required to be reviewed by the White House Office of Management & Budget (OMB). A little look-see at an obscure OMB webpage shows it currently has 17 regulatory submissions under review from the Center for Medicare and Medicaid Services.

A former CMS official I spoke with thinks this might be a record number of healthcare regulations under review by OMB at any one time. Scary, but it is likely a record that may not stand for long given all the other regulatory requirements of PPACA.

One of the biggies the physician community is waiting on is the proposed rule outlining the requirements under the Medicare Shared Savings Program: Accountable Care Organizations.

Posted in Accountable Care Organizations, CMS, PPACA | Leave a comment

This is Funny: The 10 Types of Physician Bloggers

The blog titled A Cartoon Guide to Becoming a Doctor has a very funny post on the 10 types of physician bloggers. It made me laugh out loud. Go check it out yourself.

Posted in Doctor Humor | Leave a comment

Report: State Medical Boards Not Going After Bad Docs

The Washington D.C. based consumer advocacy group Public Citizen has published a report documenting that 55% of physicians who had clinical privilege reports made to the National Practitioner Data Bank by the hospital where they practice were never subject to state licensing board action.  The report analyzed data from 1990 to 2009.  A link to the report and supporting materials including a letter transmitting it to HHS Secretary Kathleen Sebelius can be found here.

Public Citizen acknowledges that “not all clinical privilege reports to the NPDB (from hospitals about doctors) would necessarily result in state board action” but they conclude that the large number of physicians (5,887) determined to have had one or more clinical privilege reports but no state licensure action suggests that state medical boards are not properly acting on such reports or that hospitals may not be reporting them.  Public Action asks Secretary Sebelius to re-initiate OIG investigations on the effectiveness of state medical boards that fizzled out in the early 1990s.

As this report gets reviewed by physician groups and others, it is hard to ignore the particularly disturbing statistic that 220 physicians were considered an “Immediate Threat to Health or Safety” of patients but only 176 of them had their admitting privileges suspended and none were subject to state medical board action.

The report certainly supports stories in the Chicago Tribune and Washington Post in recent years that state medical boards are not doing enough to protect patients from bad doctors.  Whether the report stands up to closer scrutiny or not, anyone with experience in dealing with these state agencies can tell you that they are often times inadequately staffed to carry out their work.  Good doctors who find themselves defending frivolous claims during a protracted process will tell you that their justice delayed feels a lot like justice denied.

That lack of resources and swift action policing bad doctors at the state level stands in sharp contrast to the huge sums spent by the federal government to develop and enforce a maze of dense and overlapping fraud and abuse laws like the Anti-Kickback and Stark Laws designed to curb economic relationships between physicians, hospitals and other providers.

In turn, those federal fraud and abuse laws require hospitals and doctors to keep armies of attorneys, accountants and consultants on retainer to advise them on compliance and enforcement matters.  But even with all that brain power brought to bear on these issues, there is way too much gray area and not enough bright lines in the federal fraud and abuse regulatory environment, particularly as the federal government is urging greater cooperation and integration between physicians and hospitals to lower costs and achieve better outcomes for patients.

Should we have a system at the state and federal level that identifies and removes the truly bad doctors? Absolutely.  But if the lack of resources is the problem, how about the feds divert some funds recovered from their enforcement actions back to the states to beef up and support the work of licensing boards.

Lets face it, as a general rule, the same kind of doctor that provides bad care is often sloppy or unethical in their business practices.   If state medical boards can get better at taking bad doctors out of the system, they will be serving the twin goals of protecting patients while also striking a stance in defense against fraudulent claims for reimbursement and shady payment arrangements.

Posted in Fraud & Abuse, General, State Licensure | Tagged , | 1 Comment

Match Day: The Medical Profession’s Own March Madness

Last Thursday was Match Day across the country as the National Resident Matching Program (NRPM) administered the process where fourth year medical students get placed in a residency program and begin training in a specialty.

NRPM issued statistics showing an increased interest among medical students in primary care specialty programs like pediatrics and internal medicine. Emergency medicine, anesthesiology and neurology were also popular choices. A summary of the positions offered and filled by the NPRM can be found here.

Lets all congratulate and wish these new doctors much success in their careers. They face a future where their services will be in great demand by a public and government and private third-party payor system unwilling to compensate them like previous generations of doctors were in many cases. But all the fretting over those issues and lack of sleep or time with family and friends can wait. Now is the time to celebrate all that hard work paying off. Good luck to the Class of 2011!

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Critical Terms in Physician Employment Agreements, Part II

Ed. Note.  Welcome to the second installment in a series analyzing the critical terms in physician employment agreements.  Part I can be found here.

In addition to salary and benefits, other provisions of the agreement have an impact on the overall economics of the relationship between the physician and their employer.

Billing Issues and Participation in Managed Care

When a physician joins a group practice or hospital staff as an employee, the physician waives any right to independently bill the patient or the patient’s insurer for services.  A well-drafted employment agreement will address this issue and require the physician to comply with the billing practices of the employer.  The fraud and abuse issues associated with inaccurate billing can pose a problem for a physician.  Therefore, the physician should inquire about the employer’s billing compliance program and mechanisms for ensuring the accuracy of bills sent to government and private third-party payors.

Employers may also require that as part of the employment agreement, the physician agree to participate in certain managed care programs.  If this is the case, the physician should ask to see current copies of the managed care participation agreements to determine if the rates paid are competitive with other plans in the area, particularly if the physician is being compensated under a productivity formula.

Professional Liability and Other Insurance

Employers typically provide employed physicians with professional liability (or “medical malpractice”) and other insurance coverage.  The agreement should set forth the amount of these policies and give the physician the right to review the policy from time to time.

The employer commonly pays for professional liability insurance, and policies will either be “occurrence” or “claims made.”  Generally speaking, an occurrence policy covers those malpractice claims that result from services rendered while the policy was in-force, regardless of when the actual claim is reported.  Under a claims made policy, the claim must be made, or reported to the physician during the policy period.

A common negotiating point in physician employment agreements is which party will pay for the “tail coverage” on a claims made professional liability policy.  The tail coverage provides protection to the physician and the employer against any malpractice allegation presented after a claims made policy expires.  Because tail coverage can be a significant expense, the physician should make every effort to have the employers absorb the cost of securing it.  If the employer insists on the physician paying the premium for tail coverage, the physician should attempt to determine the cost and availability of tail coverage before signing the employment agreement.

Insurance policies can now also be obtained that cover expenses related to fraud and abuse investigations, credentialing disputes, HIPAA violations and state licensure actions.  Physicians should attempt to secure coverage through their employer for these matters as part of their professional liability insurance.

The physician should also be named as an insured under the employer’s general liability policy.  General liability insurance policies typically are written to protect the employer’s legal obligation to pay damages resulting from the negligence of the employer or its employees for things such as slip and falls, sexual harassment, and other employment discrimination claims.

Rights to Intellectual Property

If the physician will be employed in a research or academic position where the physician is involved in developing technology with commercial potential, the employment agreement should address what rights the physician may have with respect to any royalties or other revenues derived from the physician’s ideas.

Partnership Opportunities

The physician just starting out in a group practice will want to know what opportunity there will be down the road to have an ownership or partnership stake in the group.  For a new physician, a guarantee of partnership or ownership in the group would be difficult to negotiate into the employment agreement.  Therefore, the physician should seek to structure a review process that gives the physician the opportunity to regularly measure whether the goal of partnership within the group will be realized.  Once the physician is made a partner in a practice, the physician and his or her attorney must address a whole host of other legal and tax issues associated with new ownership rights and obligations.

Term and Termination

Just as every employment relationship has a beginning, it will surely have an end.  Hopefully, when the end comes, it is after a long and mutually productive association between the physician and the employer.   But that is not always the case and physicians need to know the types of events that can trigger termination under a typical employment agreement and the consequences of failing to agree on a fixed term of employment and what effect the termination will have for the physician.

For instance, physicians often relocate to a new area as part of their first job.  The hardships associated with a move to a new area mean that the physician should get some written assurances that the employer will only seek to terminate the relationship for certain causes.  Otherwise the physician will be deemed an “at will” employee and can be terminated with no notice at all.

Term

The agreement should set forth a date that the employment relationship commences and expires.  The initial term of a physician employment agreement is typically between two and five years.  Depending on the length of the initial term, the employment agreement might also contain an automatic renewal provision, allowing the contract to continue in effect on a year to year basis until terminated by the parties.

Termination

1.         Termination without Cause

If the physician desires flexibility in the term of the employment relationship, the physician might attempt to incorporate a provision allowing the parties to terminate the agreement if they mutually agree in writing.   Often, if the employer agrees to such a provision, it will require the physician to provide adequate notice of their resignation so that the employer can have sufficient time to recruit a replacement.  Correspondingly, the physician should require the employer to provide a long notice period before exercising its termination rights under this type of provision so the physician can begin the process of finding another position.

2.         Termination for Cause Due to Health Reasons or Long Term Disability

Healthcare employers will often seek to have the right to terminate the agreement if the physician suffers health problems or has a long-term disability and they are unable to perform the essential functions of their job.  If a physician agrees to this provision, then the physician should make sure that adequate insurance is in place to replace the income lost as a result of termination due to health or disability issues.

3.         Termination for Cause Due To Other Factors

Employers generally insist on employment contract provisions that allow for the immediate and automatic termination for certain breaches.  These kinds of breaches include things like loss of license, suspension from participation in government payor programs, conviction of a crime, repeated violations of the terms of the employment agreement or the employer’s policies, and use or abuse of alcohol or controlled substances in a manner that affects the quality of medical care, and loss of staff privileges.

In the event of other less serious breaches, the employment agreement typically contains a provision requiring the aggrieved party to give the other notice of the infraction and a period of time to cure the breach.

Merger, Consolidation, Change of Control

In order to avoid having to work for a different employer than the physician originally contracted with, the physician may want to include a provision in the employment agreement that in the event that the employer undergoes a merger, consolidation, or change of control, the physician may terminate the agreement.  Without a very long notice period, employers are generally reluctant to agree to these types of provisions.

Change of Law

Because of the rapid change of health care laws and regulations, it is common to now include a provision in employment agreements permitting the parties to terminate the agreement in the event that any change of law, rule, or regulation which may render certain terms of the contract unenforceable.  The provisions typically require both parties to agree to cooperate in making reasonable revisions to the agreement to bring its terms into compliance with the new law or rule change, with termination as a final option if agreement cannot be reached.

Right to Payments Following Termination

If a physician is compensated based on a production formula, it is advisable to include a section of the employment agreement addressing the portion of the accounts receivable the departing physician is entitled to after the physician has left the practice and how and when those payments will be made.

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Part III will focus on post-employment covenants and the “miscellaneous” provisions of the employment agreement.

Posted in Physician Employment Agreements | Tagged , , | 2 Comments