When it comes to evaluating practice acquisition opportunities of any sort, due diligence is the name of the game, according to a post from Diagnostic Imaging.
Physicians must weigh the benefits of selling a practice against the risks, some of which may not present themselves until it's too late for doctors to easily reverse course, according to attorneys Tim McCormack and Molly Knobler.
"If the sales agreement or employment contract comes with hefty financial penalties for failure to abide by its terms, or restrictive non-compete clauses in the case of termination, a physician could easily find him/herself with no patients, no colleagues, no lease, no equipment and a significant risk of being sued for trying to open a new practice in the same area," they wrote. "Not only can these factors make it difficult for a physician to quit, they may also give the practice owner leverage to pressure physicians to turn a blind eye to improper practices, or even participate themselves."
Examples of arrangements that may pressure physicians to compromise patient needs or even commit fraud, according to the post, include corrupt insurers pushing doctors to upcode their services; clinical "protocols" that disguise mandates to order unnecessary care; or purchases offered above fair market value with a presumption the inflated price will boost referrals.
So whether a practice is considering an offer from a unified insurer, practice management company or other entity, physicians need to ensure that they retain the power to put patient needs first.
In addition, practice leaders are wise to learn about the wide array of alignment opportunities that may offer the benefits of size without the drawbacks of employment or acquisition, FiercePracticeManagement reported previously.
To learn more:
- read the post