Category Archives for "Medical practice"

Jun 07

Shifting Alliances

By Dennis Hursh | Medical practice

I was recently at a meeting where a respected physician leader made a fascinating observation. It is his belief that the new emphasis on value-based contracting and risk-based contracting is changing the historic alliances between physicians and hospitals on one side of the table, and payers on the other side of the table.

He believes that the new contracting paradigms are creating alliances between physicians and payers on one side, squared off against hospitals on the other side. If you think about many of the new initiatives coming out of CMS (care coordination management codes, for example) a common thread seems to be that paying physicians a little more can generate huge savings on what would otherwise be spent on hospital services.

At the risk of sounding like a broken record, I think this is great news for physicians. Hospital consolidation continues at a dizzying pace, creating massive enterprises with seemingly unlimited resources. And yet, the entities holding the money (payers) finally seem to realize that the folks in the white coats, if properly compensated and incentivized, can effectively bend the healthcare cost curve.

In Pennsylvania, the market I am most familiar with, physicians are organizing clinically integrated networks designed to work with the payers to move money from the “hospital bucket” to the “physician bucket”. It is not going to happen overnight, but physicians are going to take back control of healthcare.

Who (other than hospitals) would not be encouraged by that?

Apr 15

My Doctor Made a Mistake

By Dennis Hursh | Medical practice

Last Tuesday and Wednesday were not good days.  Tuesday I was on a clear liquid diet all day, until 5 or so when I began ingesting what Dave Berry has called a “nuclear laxative”.  The reason for these festivities was that my PCP had ordered a colonoscopy for yours truly.  She had looked at the chart, noticed the colonoscopy I had in 2011, and ordered another one following a standard 5-year protocol.

For those who are unfamiliar with the process, I would commend Dave Berry’s excellent exposition of the medical, psychological and plumbing aspects of preparation for this particular procedure.

Suffice it to say, preparation for a colonoscopy isn’t something you want to do for a good time.  However, as a good little patient, I dutifully paid my dues and went through the process.

Wednesday morning, I met a charming nurse, who carefully went through my history, meds, allergies, etc.  She made sure that all the proper “prep” had been accomplished.  (Let me assure you, it most certainly had – I had, in the vernacular of veterans of the procedure,  “prepped my brains out”).  As she looked at my chart, she pulled the reports on the last two colonoscopies I had, in 2011 and 2014.  We were a bit confused as to why I needed a colonoscopy just two years after my last one, especially since the doctor who had performed the 2014 procedure recommended a follow-up in 5 years.  Those of you who are especially good at math may have figured that I needed a colonoscopy in 2019, NOT 2016.

A call to the PCP revealed that she had missed the 2014 procedure, and we decided that I could leave without having the physician explore my innards.  When I got home, I had the following message in the patient portal:

“This was totally my mistake. Now that I look through the chart, I see that he did have it done in 2014 and does not need it. I am SO sorry”

That response prompted this post.  Here’s the thing – I can’t agree with her analysis.  Was this “totally” her mistake?  Was it too much to expect the patient to remember he had undergone this procedure two years ago? Is the health system maybe a teeny tiny bit responsible for scheduling her patients like an assembly line, so she has to rush through encounters?  Could the insurer be slightly responsible, for putting physicians and health systems in a position where they can’t survive unless they grind through patients?

Let’s face it, no matter how rushed things get, the buck stops at the physician with hands on the patient.  We absolutely have to give these folks time to do what they’re trained to do.  As professionals, physicians are always going to accept blame for anything they are involved in – but it’s time that we recognize that the problem with American healthcare isn’t the physicians, it’s the system that doesn’t allow our physicians to do what they’ve been trained so well to do.

So, Laurie, I forgive you.  But the next time we meet, I will be singing the Colonoscopy Song.

Shaking on a Physician Employment Agreement
Sep 14

The Final Steps in Closing a Medical Practice in Pennsylvania

By Dennis Hursh | Medical practice , sale of medical practice

I have previously discussed eight things to consider when selling your medical practice, and warned of the dangers of relying on the “hospital fairies” to maintain your income as an employed physician in the face of increasing costs and declining reimbursement.  I have also had a good rant on the joys of hospital negotiations.  But however you may have reached your decision, this post will discuss the nitty gritty of actually closing your practice after accepting employment at a hospital.

I’m assuming that you sold to a hospital, rather than simply stopping practice.  Accordingly, I will assume that you won’t need to notify patients to avoid charges of abandonment – you’re seeing those patients in your new role as employed physician.

Financial Aspects of Closing a Medical Practice

closing businessOf course, the most important thing you will have to accomplish is to pay all the bills of the practice incurred before the sale, and collect the income from services rendered before the sale.  I generally counsel physicians to allow at least six months after the sale to collect what you can (and potentially deal with insurance companies’ claims for reimbursement, etc.).  If your practice was on a calendar year, it may make sense to close it at the end of the current year.

Before the end of the year, close out all your accounts, so the practice’s final tax return will show zero assets.  It usually makes sense to pay your healthcare attorney and accountant in advance as a fixed fee for everything that needs to be done in closing the medical practice.  For example, the CPA will need to file the final tax return, generally several months after the corporation has been closed.  You will want to make sure that is accomplished at a flat fee, paid out of the practice’s account before closing the account.  Your attorney will also have to do things after closure (discussed below), so make a deal to pay the attorney a flat fee out of the practice’s assets as well.

There is More to Closing a Medical Practice than Filing Final Tax Returns

I have frequently been informed by my clients that their CPA is telling them that filing the final tax return closes the corporation, and nothing else needs to be done.  That isn’t correct.  Filing the final tax return informs the Pennsylvania Department of Revenue (“Revenue”) and the IRS that the corporation is closed, but the Pennsylvania Department of State (“State”) has exclusive jurisdiction over opening and closing corporations in Pennsylvania.

In order for State to approve the dissolution of a corporation, you must file Articles of Dissolution with State.  State has to ensure that all employee and income taxes have been paid before it allows the corporation to dissolve.  To ensure that these taxes have been paid, State requires a Tax Clearance Certificate (“Certificate”) from both Revenue and the Pennsylvania Department of Labor and Industry (“L & I”).

The Final Step in Closing a Medical Practice

There is a form that must be filed with both Revenue and L & I to get them each to issue a Certificate.  The good news in this regard is that it is the same form, so you just need an original and a copy to file with the two agencies.  L & I usually produces the Certificate in a few weeks – Revenue sometimes takes as long as a year to cough up its Certificate.

Once your attorney has both Certificates in hand, Articles of Dissolution can be filed with State, and your corporation will be officially closed.  Your long career as a business owner will finally be over, and you can devote yourself exclusively to the practice of medicine (assuming your employer isn’t beating you up too badly on administrative duties).