Seven Basics
- 1. SEVEN BASICS IN THE WORLD OF CONTRACTS Charles J. Assini, Jr., Esq. NYSSA Legal Counsel and Legislative Representative
- 2. Each contract you enter into establishes rights and obligations which are binding on you and which you are presumed to understand.
- 3. ONE Private Group Practice Three Categories of Contracts When you become associated with a private group practice, you will be assuming contractual obligations based upon three general categories of contracts.
- 4. Private Group Practice Three Categories of Contracts Internal Group Agreements “ Group” Agreements Physician Agreements
- 5. A. Internal Group Agreements Contracts between the private group and the private individual physician members.
- 6. A. Internal Group Agreements Employment Shareholders or Operating Stock Purchase Deferred Compensation Pension and Profit Sharing Plans Medicare Anti-Fraud and Abuse Compliance
- 7. B. “Group” Agreements Contracts between the group and third parties.
- 8. B. “Group” Agreements Exclusive Service (with Hospital) – See Appendix A-Hospital Contracts, Four Years Later by Karin Bierstein in the Legal Primer Billing Services
- 9. C. Physician Agreements Contracts between individual physician members of the group and third parties.
- 10. C. Physician Agreements Medical Malpractice Insurance Hospital Medical Bylaws Third Party Payor Agreements
- 11. TWO Due Diligence and Equity Ownership Become familiar with the entity you are considering joining and appreciate the advantages of equity or ownership status.
- 12. Due Diligence and Equity Ownership Conduct A Due Diligence Review Advantage of Equity Or Ownership Status Annual Assessment-Equity Track Ownership Equity “ Non-Partnership” Contracts
- 13. A. Conduct A Due Diligence Review See Appendix B-“Checklist for Evaluating a Group Practice Opportunity” in the Legal Primer
- 14. B. Advantages of Equity or Ownership Status Job Security Share in Profits of the Group: The Group’s Accounts Receivable Participation in Management
- 15. C. Annual Assessment – Equity Track Consider requesting that the group incorporate the following into your contract.
- 16. C. Annual Assessment – Equity Track The group agrees to discuss with you annually, at the same time that your compensation is reviewed, your performance as well as the group’s opinion regarding your eligibility for an offer to become a shareholder. Also see Appendix C-“Performance Evaluations” by Karin Bierstein, J.D. in the Legal Primer
- 17. D. Ownership Equity See sample clauses under “Acquisition of Stock” in the Legal Primer.
- 18. D. Ownership Equity Terms of the Buy-in. Bonafide Equal Equity Owner?
- 19. E. “Non-Partnership” Contracts Stated Salary . Duties : No “on-call” or “weekend.” Days, Hours, Holidays : Defined. Locations : To render services. continued …
- 20. E. “Non-Partnership” Contracts Disabilities and Pregnancies : NYS Law considers pregnancy a “disability” with same benefits. Conversion to Partnership Track : See sample clauses under “Conversion to Partnership Track” in the Legal Primer .
- 21. THREE Essential Terms of Employment Agreements Know the essential terms of the Employment Agreement (see “Essential Terms of the Employment Contract” in the Legal Primer for sample provisions).
- 22. Essential Terms of Employment Agreements Term and Termination Salary and Benefits Terms and Conditions Duties and Responsibilities Vacation
- 23. A. Term and Termination “ At will” v. “for cause.”
- 24. B. Salary and Benefits Physician Compensation and Production Survey (see Appendix D -“Physician Compensation and Production Survey” in the Legal Primer). Fixed Salary v. Productivity Compensation Formula (see “Productivity Compensation Formula” in the Legal Primer).
- 25. C. Terms and Conditions Outside Practice Restrictions. Incorporate by Reference the Policies and Procedures of the Group (see “Duties and Responsibilities” in the Legal Primer).
- 26. D. Duties & Responsibilities CRNA Supervision . Pain “Specialty” : Standard contract is inadequate for integrating a pain practice into a general anesthesiology practice.
- 27. FOUR Professional Malpractice Insurance Appreciate the importance of professional malpractice insurance coverage.
- 28. Professional Malpractice Insurance Defense and Indemnity Protection Name of the Company Name of Insured Limits of Liability Defense Only Coverage Claims Made v. Occurrence Medical Liability Mutual Insurance Company (“MLMIC”) Rates
- 29. A. Defense and Indemnity Protection
- 30. B. Name of the Company Is it financially stable?
- 31. C. Name of Insured You or the group?
- 32. D. Limits of Liability $1,300,000 per occurrence, $3,900,00 per aggregate, and excess layer. Malpractice awards have increased from an average of $1.7 million in 1994 to $6 million in 1999.
- 33. E. Defense Only Coverage $25,000 standard and up to $100,000 for additional premium (Administrative Reviews, Fraud and Abuse, OPMC).
- 34. F. Claims Made v. Occurrence See Appendix C-Chart of “Medical Malpractice Insurance: Claims Made v. Occurrence Coverage” in the Legal Primer.
- 35. FIVE Problematic Clauses Problematic clauses contained in the Employment Agreement.
- 36. Problematic Clauses Indemnification Billing and Assessment of Billing Audit Costs Covenant Against Competition Waiver of Rights
- 37. A. Indemnification See “Corporate Liability” under “Professional Corporation” in the Legal Primer.
- 38. B. Billing & Assessment of Billing Audit Costs Employers will take the position that it is essential that you provide medical records that are accurate, complete, and submitted in a timely fashion. Understand billing requirements and your liability. (See “Assessment of Billing Audit Costs” in the Legal Primer.)
- 39. C. Covenant Against Competition See “Non-competition Clause or Restrictive Covenant” in the Legal Primer.
- 40. D. Waiver of Rights See “Peer Review and Due Process Rights Waiver” in the Legal Primer.
- 41. SIX Other Practice Options See “Other Practice Options” in the Legal Primer.
- 42. Other Practice Options Academic Office Based Solo or Small Group Practice Pain Practice
- 43. A. Academic Bylaws Patent Policy Intellectual Property, Copyrights, Royalties Policy Outside Employment Policy continued …
- 44. A. Academic Financial Disclosure and Conflict of Interest Policy Code of Ethics and General Conduct Policy Guidelines on the Conduct of Research continued …
- 45. A. Academic Current and AAUP Bargaining Unit Agreement Policy on HIV, HBV, and HVC
- 46. B. Office Based What practice regulations and/or guidelines are in effect in the jurisdiction you provide office-based anesthesia? For New York State’s Clinical Guidelines, see: www.health.state.ny.us/nysdoh/obs/obs.htm
- 47. C. Solo or Small Group Practice Exclusive Contract : Can you secure one? Can you satisfy coverage requirements? CRNAs : Are surgeons willing to supervise? continued …
- 48. C. Solo or Small Group Practice Financial Stipend : Is there one paid by the Hospital? Early Termination : Penalty? continued …
- 49. C. Solo or Small Group Practice CMS Rule : Impact of rule allowing Governors to permit CRNAs to administer anesthesia without direct personal supervision of a physician.
- 50. D. Pain Practice Unique Legal and Practice Management Issues and Contract Clauses Hospital Privileges? Anti-Kickback and Hospital Space
- 51. SEVEN Negotiating Your Contract
- 52. Negotiating Your Contract Pre-Contract Due Diligence The Agreement You Execute Is A Legal And Binding Contract
- 53. A. Pre-Contract Due Diligence Please note that the group will extensively analyze your background prior to extending an offer to you. You are encouraged to do the same with respect to the group.
- 54. A. Pre-Contract Due Diligence Evaluate a Group Practice : (see Appendix B “Checklist for Evaluating a Group Practice Opportunity” in the Legal Primer). continued …
- 55. A. Pre-Contract Due Diligence Relationship with Hospital Administration? Active in Medical Staff Affairs? Relationship with Surgeons? continued …
- 56. A. Pre-Contract Due Diligence Able to Cope with the Changing Health Care Market Place? Group Effectively Managed? Medicare or Corporate Compliance Plan? continued …
- 57. A. Pre-Contract Due Diligence Adherence to ASA Ethical Standards : Non-exploitation of young physicians (see Appendix G “Editor’s Notes” from CSA Bulletin in the Legal Primer).
- 58. B. Agreement is Legally Binding Contract You Must Take Responsibility For Your Employment Decision : Do NOT execute a one-sided employment contract in the hopes that the group will disregard their contractual rights. continued …
- 59. B. Agreement is Legally Binding Contract You are Presumed to Know What You Are Doing Terms Not Included in the Contract May Be As Important As Those in Contract continued …
- 60. B. Agreement is Legally Binding Contract Should You Use An Attorney?