For New Physicians

By now all health care providers have become painfully aware of the pitfalls of not being vigilant when it comes to considering the release of patients’ health information kept in electronic form (Electronic Health Information or “EHI”). Caution being the better part of valor, many physician providers and hospitals take the position that, when they aren’t sure whether or not they can release EHI, they choose to not release it. ​ Welcome to the new world of “Information Blocking” (“IB”). A part of the Federal 21st Century Cures Act, the Information Blocking (IB) Rule now forces providers to begin with the presumption that EHI is to be disclosed unless they can clearly determine that the EHI should not be disclosed. We now must shift from a “may disclose” attitude to a “shall disclose unless an exception to disclosure applies or disclosure is prohibited by law” attitude. ​ Information Blocking means a practice that: ​ Except as required by law or covered by an exception, is likely to interfere with access, exchange, or use of electronic health information; and, If conducted by a health information technology developer, a network or exchange knows, or should know that such practice is likely to interfere with, prevent, or materially discourage access, exchange or use of EHI; or, If conducted by a health care provider, such provider knows that such practice is unreasonable and is likely to interfere with the access, exchange, or use of EHI. ​​ The definition of EHI is based upon the HIPAA definition of Designated Record Set (DRS) but is not limited to HIPAA Covered Entities. DRS includes medical and billing records of a covered health care provider, specific health plan records such as enrollment, payment and claims records and records used by a covered entity to make decisions about individuals. Also included will be pricing information, algorithms or processes that create EHI as well as information resulting in clinical interpretation or relevance of algorithms or processes. If the data that is requested is completely de-identified (meaning identifying information such as names, addresses, telephone numbers, social security numbers, etc. is removed), it is not subject to the IB rule. If disclosure of requested information is blocked pursuant to law, it is not subject to the IB rule. In order to be considered blocked as required by law, the right to interfere with access, exchange or use of the EHI must be explicitly required by state or federal law. Note that blocking as required by law is not the same thing as blocking that may be allowed under law. The law states that Information Blocking will almost always be implicated if a provider interferes with: the access, exchange or use of EHI for patient access to their own EHI and use without special effort; treatment and care coordination; payers obtaining EHI to assess clinical values/promote transparency, quality improvement; and the support of patient safety and public health. The IB Rule states that a provider will be in violation if it knows that its practice is unreasonable and is likely to interfere with the access, exchange or use of EHI. Question: What do medical practices and hospitals need to do? Answer: Assess their policies and processes to ensure that they are compliant with the IB Rule and to prevent the improper refusal to disclose EHI. ​ For further information, please Contact Us .

Undoubtedly, along with the COVID-19 pandemic will come a wave of malpractice lawsuits where the theory of negligence against the provider will be based on the treatment provided. We expect to see at least the following theories: failure to diagnose, failure to treat and failure to treat in a timely manner. Much will depend upon the creativity of plaintiff attorneys; however, we are already seeing COVID theories related to non-COVID issues, such as failure to monitor a patient post-operatively which allowed a patient to contract the virus. We offer below some suggestions for our clients. ​ To prevail in a medical malpractice case the plaintiff must prove that the physician or provider: • had a duty to provide care according to a certain standard • strayed from that standard, and • due to the physician or provider’s conduct, • caused an injury to a patient. To protect you from malpractice claims and to place yourself in a strong defense position, thorough documentation is critical. You should operate under the assumption that a judge or jurors will conclude that if something is not documented it was not done even if it was, in fact, done. We offer the following suggestions to help you mitigate your risk: • Use a waiver form. Providers are well advised to consider updating their patient consent forms for patients receiving care and treatment during the pandemic. These forms should include an acknowledgement of the potential risks of becoming infected with COVID-19. • Always document the events of a patient encounter including at least: date, time, signs and symptoms, plan of treatment, recommended follow up, patient’s understanding and agreement. If you change your plan of treatment that should also be documented in the medical record. Such documentation should include instructions provided via telephone. • Have the patient sign discharge or other instructions indicating understanding and agreement. • Document failure to follow up. Reach out to the patient via phone and in writing to state that the patient has not followed up as recommended. Note that such communications must be confidential due to HIPAA and privacy laws. As always we are available to assist with any of the above. For further information, please Contact Us .

​ The COVID-19 pandemic has had a significant effect on the economy and has forced practices to downsize and reduce expenses. In the face of these changes, the question arises from our physician clients: which status is best - an employee or an independent contractor? Are you an entrepreneur? Do you like to manage people? Do you like to handle finances? Are you the type of person who does not need to predict his/her income or expenses? Are you a business risk-taker? Do you consider yourself a rainmaker? If you answered "yes" to all of these questions, perhaps you should consider being an independent contractor. Being an independent contractor is like having your own private practice in many ways including covering your overhead costs and taking on personal liability. ​ On the other hand, if you prefer to know how much and when you will be paid, if you like to “disconnect” at the end of the day and be flexible with your work life, if you do not like taking business risks, and if you prefer to leave administrative issues to others, then the employee route may be the best option for you. ​ The legal distinction between an independent contractor and an employee is an important one. An employee (W-2) works under the control and direction of the employer; whereas, an independent contractor (1099) works independently and has greater control over his/her own time. Worker classification also affects how taxes are paid and by whom, and whether someone is eligible for social security, Medicare and other types of benefits. The IRS distinguishes between the two and uses a three-part test to determine whether a worker should be classified as an employee or independent contractor which has tax consequences. The benefits of an independent contractor versus an employee vary on a case-by-case basis so we highly recommend you discuss the financial and tax benefits with your accountant. ​ Aside from the financial aspect of deciding whether you should be an employee or independent contractor, your personal desires and goals should also be factored into the decision-making process. ​ Each of our provider clients are unique. It is important for you to recognize your personal preferences when it comes to deciding whether to be an independent contractor or an employee. We are here to help you and to draft or review your agreements. For further information, please Contact Us . ​

Telemedicine is growing in popularity in the healthcare industry as physicians decide whether to use telemedicine to care for patients during the COVID-19 public health emergency. Before making any decision, you should consult with an attorney regarding the various legal implications since the laws surrounding telemedicine are constantly changing and vary from state to state. Telehealth v. Telemedicine Just as the laws surrounding telemedicine vary from state to state, so do the definitions of telehealth and telemedicine vary. Generally, telehealth refers to a broader scope of remote healthcare services, which includes both clinical and non-clinical services; whereas, telemedicine refers to remote clinical services. Thus, telemedicine is the subset of telehealth. Some states refer to telemedicine as telehealth; whereas, other states distinguish the two terms. For example, the Illinois Telehealth Act (225 ILCS 150/5) defines telehealth as “the evaluation, diagnosis, or interpretation of electronically transmitted patient-specific data between a remote location and a licensed health care professional that generates interaction or treatment recommendations.” On March 19, 2020, Illinois Governor Pritzker passed Executive Order 2020-09, which expands the definition of telehealth services “to include the provision of health care, psychiatry, mental health treatment, substance use disorder treatment, and related services to a patient, regardless of their location, through electronic or telephonic methods, such as telephone (landline or cellular), video technology commonly available on smart phones and other devices such as FaceTime, Facebook Messenger video chat, Google Hangouts video, or Skype, and videoconferencing.” Distant Site v. Originating Site The terms distant site and originating site are also used frequently when discussing telemedicine. The distant site is the location of the physician at the time the service is provided; whereas, the originating site is the location of the patient. Main Categories of Telemedicine The three main categories of telemedicine include: (1) interactive medicine, (2) store and forward, and (3) remote patient monitoring. First, interactive medicine, also known as “live telemedicine”, allows patients and medical professionals to communicate in real-time through audio and video technology. Second, the store and forward category allows medical professionals to collect data from a patient, such as blood glucose levels, and forward the data to another licensed professional for assessment. Third, the remote patient monitoring method allows a medical professional to monitor a patient remotely using various medical devices to capture blood pressure, glucose levels, etc. Legal Implications As mentioned above, telemedicine laws vary from state to state, especially now as many states remove certain restrictions and barriers during the COVID-19 pandemic. Physicians must abide by the laws of that state where the patient is located. For instance, if an Illinois physician provides telemedicine services to a Michigan patient, the Michigan laws apply. Several legal issues must be considered before implementing a telemedicine program. 1. Physician-Patient Relationship Before providing telemedicine services, a physician-patient relationship must be established. A physician-patient relationship is established when a patient knowingly seeks a physician’s services and the physician knowingly accepts a patient. While some states require an in-person examination prior to providing telemedicine services, Illinois laws do not have such a requirement. As a best practice, when establishing the physician-patient relationship via telemedicine, the physician should verify the identity and location of the patient at the time of service to ensure compliance with the laws of the state where the patient is located. 2. Informed Consent Informed consent is the process in which a patient is made aware of the risks and benefits of undergoing a medical service, treatment, or procedure. A physician has a duty to disclose all reasonable information to a patient in order for the patient to make an informed decision about a particular medical service, treatment, or procedure. However, when it comes to specific requirements regarding informed consent for telemedicine services, some states require providers to give patients specialized, informed consent regarding the potential risks, benefits and limitations of telemedicine practice. When providing telemedicine services, it is important to have an attorney review the consent forms to ensure the appropriate language is included for virtual visits. While Illinois does not have specific requirements for informed consent via telemedicine, a best practice before the first telemedicine visit is to explain to patients how telemedicine works (i.e. when service is available, scheduling, privacy/security measures etc.), any limits on confidentiality, the possibility for technical failure, protocols for contact between virtual visits, prescribing policies, and coordinating care with other health professionals. 3. Licensure Telemedicine services must be provided by a health care professional who is licensed, registered, or otherwise authorized to engage in his or her health care profession in the state where the patient is located. The key factor in determining whether the physician may provide telemedicine services is the location of the patient. In addition, if services are conducted through an entity, the entity must be active and registered in the state where telemedicine services are provided. However, amid the COVID-19 pandemic, some states waived the licensure requirements and permit out-of-state physicians to provide telemedicine services. Licensing requirements vary from state to state so you must ensure that you comply with the laws of the state where the patient is located. 4. Teleprescribing Given the declaration of a public health emergency by the U.S. Department of Health and Human Services (HHS), DEA-registered practitioners may issue prescriptions for all schedule II-V controlled substances to patients for whom they have not conducted an in-person medical evaluation, provided all of the following conditions are met: ​ The prescription is issued for a legitimate medical purpose by a practitioner acting in the usual course of his/her professional practice; The telemedicine communication is conducted using an audio-visual, real-time, two-way interactive communication system; and The practitioner is acting in accordance with applicable Federal and State laws. 5. Medical Malpractice Liability Before providing telemedicine services, a physician should check with his or her professional liability carrier regarding liability coverage for telemedicine services. By providing telemedicine services, the physician is subjecting himself/herself to the laws of the state where the patient is located and its jurisdiction. The physician should verify that he/she meets the other state’s requirements and that the insurance carrier provides coverage for the work in the other states. 6. Privacy The Health Insurance Portability and Accountability Act of 1996 (HIPAA) and Health Information Technology for Economic and Clinical Health (HITECH) sets rules for how patient information must be protected. Since physicians are responsible for protecting patient information, they should ensure that patient information in telemedicine visits are safeguarded in the same manner that in-office visits are safeguarded. As of March 6, 2020, the HHS Office of Civil Rights announced that physicians and clinicians may use any audio or video communication technology that is “non-public facing” to care for patients for any reason (not just COVID-19 patients). Some examples of these non-public facing platforms include Apple FaceTime, Skype, Zoom and Google Hangout video. Facebook Live and TikTok are excluded from the permissible non-public facing platforms. Even though HHS relaxed the penalties for using non-public facing technology during the COVID-19 outbreak (which may not be fully compliant with HIPAA regulatory requirements), it is still important for physicians to enable application privacy and encryption settings when possible. With various technologies, there is a risk of a data breach, which may put sensitive patient information at risk of exposure. As a best practice, physicians should ensure the technology being used is fully secure and HIPAA-compliant. Furthermore, physicians should consider updating consent forms to ensure patients are notified of the privacy and security risks associated with telemedicine. Also, when allowing electronic personal health information to be stored by a third-party, physicians should ensure that a Business Associate Agreement (BAA) is signed by both parties. The BAA should discuss how the third-party will safeguard patient information and how often audits will be conducted to ensure the data’s security. 7. Non-Compete Provisions in Personal Service Agreements to Provide Telehealth Services for a Company as an Independent Contractor or as an Employee Contracts to provide Telehealth Services which contain non-compete provisions should be scrutinized carefully. Restrictive Covenants or “noncompete” language in contracts dictate where and when a former employee or contractor can work after a contract terminates, often for any reason or no reason. If you are entering into an agreement, consulting an attorney for advice is recommended to help limit personal legal exposure. The legal issues mentioned above are just a few examples of what needs to be considered when deciding whether to implement or be involved in a telemedicine program. Since each state has different requirements with telemedicine and the requirements are rapidly changing during the COVID-19 pandemic, please contact Malecki & Brooks Law Group, LLC to find out the specific requirements for a particular state. For assistance in telemedicine matter please contact Natalie Ficek or call us at 630-948-4807.

Have you thought about owning or working with a medical spa? If so, here are a few important aspects you should consider before making your decision. Before you open a medical spa or begin working for one, you must ensure that the ownership structure does not violate any law. Otherwise, your license to practice medicine may be at risk for discipline. You could lose your license or be charged with fines and penalties even if you had no idea that you or the owner were breaking the law. The Illinois Department of Financial and Professional Regulations (IDFPR) regulates physician licensing. A physician or a physician-owned entity must be the sole owner of a medical practice in Illinois because the “corporate practice of medicine” doctrine prohibits a lay entity (i.e., one that is owned by non-physicians) from practicing medicine, either through the entity itself or by employing or contracting licensed physicians, under the theory that medicine may be practiced only by professionals who are duly licensed by IDFPR. A medical spa provides medical services, is considered a medical practice, and it must be one-hundred percent physician-owned. If a physician is asked to be a medical director at a medical spa, the physician must be sure the medical spa is owned by another physician licensed in Illinois. In Illinois it is unlawful for a physician to be employed as a physician or a medical director by a medical spa that is not owned by a duly licensed physician. Sharing revenue is another factor in medical spa ownership. Physicians may not share, or split, any professional fee or compensation for the professional services provided, with limited exceptions (billing, collections, etc.). Physicians may not share these professional fees with non-physicians. If a physician shares revenue with non-physicians, or pays employees commissions on procedures, the physician may be violating state fee-splitting statutes. Medical care at a medical spa must be provided under a licensed physician’s supervision and oversight. Under the Illinois Medical Practice Act, physicians may delegate medical treatments to an appropriately trained and experienced health care professional provided the physician is available for consultation or collaboration. Medical spas typically operate under a physician’s license and their malpractice insurance. As a physician, you are responsible for each patient that comes to the medical spa and your license is on the line if you fail to comply with the laws and regulations governing medical spas. It is crucial that you educate yourself about the risks associated with medical spas before you make the careful decision of owning or working with a medical spa. Also, you must educate your staff, especially your licensed cosmetologists and estheticians, so they understand the differences between their scope of practice and the practice of medicine. How a medical spa is advertised should be carefully considered, particularly if the spa works in conjunction with a non-medical business, such as a hair salon. As an example, a hair salon may not hold out the physician who owns or works in the medical spa as an employee or agent of the hair salon. With the current trend toward cross marketing, this is an often overlooked area and physicians are prudent to seek legal advice regarding this issue. The medical spa industry has been booming for the past several years and medical professionals are taking advantage of the rising market especially since most procedures are provided on a cash basis. The decision to own or work for a medical spa should not be taken lightly, especially with the complicated legal issues associated with this industry. ​ For further information about the medical spa industry contact Melinda Malecki .

“It’s the least I can do. If there were anything less, I’d do that.” - Georg Osterman ​ One of the most important, yet overlooked, parts of a physician employment agreement is the list of job duties. The reason it is often overlooked is primarily due to the general belief that the duty of a physician is to practice medicine. The lack of a job description or the inclusion of a loosely drafted job description can cause problems for the physician as well as the employer. In short, job duties are material terms of a contract that can be enforced by the employer. ​ When reviewing a proposed employment agreement, a physician may be focused intently on compensation and benefits and not pay attention to the list of “job duties” that could have a significant legal impact on the physician. Likewise, the absence of a list of duties may result in the employed physician being required to spend time engaged in activities that he/she did not consider when accepting employment. A common example is an employment agreement that dictates the number of hours in a day to be worked but does not take into consideration expected call coverage or practice development activities. Another example is “administrative duties” that are often listed but not clearly defined. ​ Although not an exhaustive list, the following should be clearly understood and defined if contemplated as a job duty: ​ Where will the services be performed? This is important if the practice has multiple offices or a hospital has multiple clinics. The agreement should state if services will be provided only at one location or if the physician may be required to travel to other locations. This is even more important if the employment agreement includes a non-compete clause. How much call will the physician be expected to take? What administrative duties may be required of the physician? Will the physician be expected to spend additional time promoting the practice and, if so, how much time and what activities will be expected? Will the physician be required to supervise Advance Practice Providers? What is the specific area of practice that the physician will be expected to provide services? What are the minimum and maximum number of hours per day/week expected of the physician for patient encounters and other required activities? The definition of these duties is as important for the employed physician as it is for the employer. For instance, if the employer wants the physician to travel to another location, the physician may properly refuse if the employment agreement only lists one address at which the physician will be working. On the other hand, if the employment agreement is not specific as to where the physician will be working, the employer could take the position that the physician will be expected to work at any location directed by the employer. If the physician is expected to enter into collaborative agreements with Advanced Practice Providers, those duties should be set forth in the agreement. If those duties are included, they should specify the number of Advance Practice Providers for whom the physician will be responsible, as many states have laws defining the maximum number allowed. If those duties are not listed, the physician can theoretically refuse to fulfill those duties unless additional compensation is offered. If those duties are set forth in the agreement, but no limitation on how many Advance Practice Providers will be assigned to the physician, the physician will not be able to refuse even if those additional duties create a hardship on the physician. ​ CAUTION: The balance between clarifying job duties and appearing to be a “team player” is delicate during the contract negotiation process. A physician who wants the job does not want to be perceived as being lazy. A common example of this is “call time.” For some physicians, the amount of “call” required is very important to lifestyle. However, for other physicians it is not an issue because the specialty does not demand arduous call. In the latter situation, there is no reason to strenuously negotiate the details of call in the contract. Your attorney can help decipher these issues with you. ​ For further information, please Contact Us .

Often, physician employment agreements refer to the potential of an employed physician acquiring an ownership interest in the employer’s business if certain conditions are met. As an example, a condition may include a requirement of working for the practice for a certain amount of time or achieving satisfactory results on performance reviews before qualifying for potential ownership. Unfortunately, in too many instances due to very subjective language, the employee never actually becomes eligible for ownership. If owning part of a practice could be a material reason for you to accept a position please read further. ​ Here is an example of an ownership option that cannot be enforced: “If Employee remains in the employ of the corporation for ___ years and if Employer in its sole discretion wishes to offer ownership to Employee it may do so subject to a transaction that is separate from this Agreement.” Compare this to an example of an ownership option that is clearer and can more easily be enforced: “If Employee remains in the employ of the Corporation for ___ years, Employee shall be entitled to purchase an ownership interest in the Corporation in an amount of ownership equal to the other owners.” ​Recommendations: Decide how important it is for you to become an owner while negotiating an employment agreement. To some, for their own personal reasons such as moving and building a career, this is very important. To others it is a “take it or leave it.” In our view, if it is on the table, you should take it because if the contract is constructed correctly you can leave it later. If an employer promises you ownership it must be in writing. Otherwise, you do not have a legally binding and enforceable agreement. True options to purchase include specific language. For example, after “X” amount of years, the Physician shall have the option to purchase an ownership interest in the practice. In our experience, these true options are less common than others. Most options to purchase are vague and include discretionary and subjective language. For example, if the Physician meets the Practice’s expectations, in Practice’s sole discretion, then the Physician may be presented with an ownership option. This language is discretionary and unenforceable for the physician. Keep in mind that if you are working for a practice over several years as an employee, you are helping to build equity for the practice. Thus, the fruits of your labor will be part of the value. Remember, you are not forced to use an option to purchase even if you have one. If the agreement is construed properly, you can walk away from that opportunity. As always, we recommend having your contract reviewed by an experienced health care attorney. ​ For further information about estate and legacy planning, please Contact Us .

“The patient billing and collection process is going smoothly during the pandemic, including billing for telehealth visits,” says Laurie Guagenti, Managing Partner of Premier Healthcare Services, a long-standing physician billing company in Illinois. “What HAS changed is the increased amount of time it takes to get physicians credentialed by payors.” Typically, physician employment contracts state that the physician must be credentialed by specific payors before providing any services. Consequently, due to the complex and time-consuming credentialing process and now short staffing by the payors, physicians should be careful to prevent delays in their start dates so they can predict when they will have an income. We have received inquiries from clients as to what can be done from a legal perspective. As previously highlighted in one of our articles titled “I Did Not Have My Contract Reviewed by An Attorney Before I Signed It. Now I Need to Pull A Rabbit Out of My Hat!, " contracts should be reviewed and negotiated carefully before the terms of any employment offer are accepted. Credentialing is not within the control of the physician once he/she has complied with information requirements which normally include providing the requested information to the employer or payor in a timely manner. Therefore, when it comes to the language about the credentialing process in an employment agreement, we recommend adding a “no later than” date to clearly indicate that the credentialing process must be completed by a specific date. ​ Be prepared that future employers may balk at stating a definite start date because, understandably, they want an employed physician to start seeing patients immediately after starting and, of course, they want to receive payment for the services provided by the physician. In view of the pandemic, if a physician wants to negotiate a “no later than” date for the contract, one suggestion is to offer the employer other services that would not constitute “treating patients.” For example, reviewing medical records or policies and procedures are tasks that can be performed by a physician and that do not require directly treating patients. ​ As always, we are here to assist you in negotiating employment contracts and to guide you every step of the way! ​ For further information, please Contact Us .

Force Majeure Clauses are not new in the contract world; however, they have achieved a new meaning during the COVID-19 pandemic. COVID-19 can be deemed to be an event “beyond a party’s reasonable control” and may trigger early termination of a contract without consequence which can be detrimental to employed physicians and providers. ​ Here is an example of a Force Majeure Clause: "If either party is prevented from performing its obligations under this Agreement, whether such inability to perform is caused by strikes or other labor disputes, official or unofficial, fire, war, flood, pandemic or any other reason beyond the party’s reasonable control, each party’s rights and obligations hereunder shall cease upon notice of such cessation by either party." ​ Force Majeure Clauses are starting to specifically reference “pandemic”, “epidemic”, “virus”, “crisis” or “governmental action” in the list of triggering events and would allow a party to stop performing its obligations without consequence due to COVID-19. Even if a Force Majeure Clause does not specifically list any of the events mentioned above, it may have a “catch all” phrase, which would include COVID-19 as a triggering event. Catch all phrases ensure a broad ability to terminate the contract “for any other reason beyond the parties’ reasonable control.” ​ Parties should consider whether the Force Majeure Clause allows both parties to cease performance under the contract. While physicians must take caution with Force Majeure Clauses, practices should also pay attention to these clauses in their standard template contracts. The pandemic has raised several concerns and highlighted that Force Majeure Clauses should not be glossed over as boilerplate language in contracts. As such, Force Majeure Clauses should be negotiated and documented appropriately. Of utmost importance is to ensure that early termination protections apply in the event the Force Majeure Clause is triggered. Also, be especially cautious and seek legal advice if you are presented with an Amendment to your current contract that contains a Force Majeure Clause. ​ As always, we recommend having your contract reviewed by an experienced health care attorney. For further information, please Contact Us .

Tail Insurance is a type of malpractice insurance coverage that covers claims that are made AFTER your malpractice policy has expired or been canceled. It covers claims that occurred during your policy period but are not reported until after the policy period has ended. In other words, a malpractice claim is filed against you for a time when you were insured by a prior carrier. You need insurance coverage for that claim whether the case has merit or not because you will still need to hire an attorney, defend it and possibly pay for damages. You will not want to do that out of your pocket which is commonly referred to as “self-insuring.” ​ To visualize and perhaps simplify the complex concept of tail insurance, think about the tail of a cat floating over a cat’s back like a protective “arch.” The back of the cat is the time that you worked in a specific job and had malpractice insurance for that job. The tail “covers” you and protects you from claims that occurred while you were on that job but did not expect and likely do not know anything about. If you have “claims made” insurance coverage, the most common type, a gap will be created when you stop coverage unless you purchase insurance to cover the gap. This can be in the form of what is called “tail insurance” or it can also be in the form of other types of coverage, such as retroactive (“nose”) or continuing coverage with your existing carrier. We tell our clients to think of “tail” coverage as the “Cadillac” version of coverage for claims incurred but not reported or not known. It is the most expensive insurance product for its function but the most desirable for both employees and employers. Generally, tail insurance costs 200 per cent of the annual expiring insurance premium and it increases in cost over the first three years of coverage. Think of this from an OB/GYN perspective. If a premium is $100,000 per year, the tail could be $200,000. We have had clients who did not understand this and were left having to purchase a tail with their own money. Depending upon the specialty, this can be a significant amount of money. ​ When negotiating an employment agreement, tail insurance is one of the most important points to understand and negotiate so that when you leave your job you 1) will have tail coverage and 2) hopefully it will be purchased by your employer instead of by you! ​ Tips for negotiating tail insurance coverage in an employment agreement: ​ Explore whether the employer is willing to provide tail coverage at the employer’s expense, particularly if the agreement is terminated by the employer without cause; In the alternative, try to negotiate partial contributions over time based on how long you are employed (e.g. tail is provided in increasing incremental amounts if you stay with the employer for agreed upon amounts of time). If the employer is not willing to provide any tail coverage, try to negotiate the option for other types of coverage, such as retroactive (nose coverage) or continuing coverage; Do not contractually commit to naming the employer as an “additional insured” because you cannot commit on behalf of the insurance company and many will not list a party as an “additional insured; Professional liability coverage and post termination coverage should be clearly documented in the employment agreement. For further information about tail insurance, please Contact Us .

"At-will" employment is the legal rule in Illinois and in many other states. It allows employers and employees to terminate an employment relationship at any time, for any reason or for no reason at all. This “without cause” termination language is often included in employment contracts. You may prefer this laissez-faire approach to employment contracts if you like having the freedom to leave your employer whenever you wish or at a moment’s notice. However, if you prefer more security from your employment relationship, as most professionals do, you need to know what the contract provides for before you sign it. To determine that you should understand the difference between the legal terms of “For Cause” and “Without Cause.” ​ Termination for Cause ​ A “For Cause” provision in an employment contract requires the employer to offer a proper reason for termination. This means that your employer may only terminate your employment if there is a reason (e.g. failure to complete medical records in a timely manner). A notice requirement may be included in this situation and may allow a certain number of days to correct the problem before actual termination can occur. However, this varies from contract to contract. Termination Without Cause A “Termination without Cause” provision requires the employer, and often the employee, to provide written notice of intent to terminate the contract. It allows a certain time period before termination can occur. Termination “without cause” can be for any reason or no reason as long as it is not done for illegal motives such as discrimination or retaliation. Most notice requirements range from 30 days to 120 days. Since there is no specific legal requirement as to the number of days, it is subject to negotiation between the parties. Without a notice provision stating the number of days required from the time notice of intent to terminate to the last date of employment, an employer can terminate at any moment without recourse and without any severance pay unless otherwise specified in the contract. From a financial perspective this is very risky for the employee, especially one who has relocated for a job or cannot be without a job while looking for a new one. ​ As always, we are here to assist you in negotiating and drafting employment contracts and to guide you every step of the way! For further information, please Contact Us .

Employment contracts are not entered into because the parties assume a relationship will be without problems. Contracts should be entered into assuming a relationship will have problems and address those problems before signing. This is particularly important for physicians who are recruited to a new job and who have an established career or are on a career trajectory. Often, established physicians make significant moves to accept a new position including moving their home and families. This requires careful thinking and the ability to predict possible situations that should be addressed during contract negotiations. Physicians are hired because the employer, be it a hospital/health system, physician group, or educational institution, sees the benefit of having that physician as a member of its team. It may be because of a needed specialty, anticipated revenues, name recognition and/or a multitude of other reasons. At the time an offer is extended, the excitement of the new opportunity and the proposed compensation being offered are not the only considerations. Physicians should keep their eyes wide open to avoid pitfalls which may present themselves should the relationship go south. When receiving an employment contract from a prospective employer, physicians should review the written document carefully and consider negotiating, among other things, the following: A termination provision that only allows for termination at the end of the contract term unless the termination is “for cause”. For cause should not be left in such a way that it is vague or only up to the employer to define what it means. A severance package if the contract is terminated by the employer. The preservation of any bonus that would be paid had employment continued. A clear indication of how and when post-termination productivity pay will be compensated. The payment of tail insurance if professional liability coverage is on a “claims made” basis. The retention of medical staff membership. A non-disparagement agreement that survives termination of the contract. A true option to become a partner if that is negotiated. The forgiveness of any signing or other incentives if terminated by employer at any time without cause or if terminated by physician at any time with cause. Release of non-compete provisions if terminated by employer at any time without cause and if terminated at any time by physician for cause. Above all, make sure that before accepting the terms of any employment offer, you have your contract reviewed by an experienced health care attorney. If you have any additional questions or need assistance, please Contact Us if we may be of assistance.

A Primer to Navigate Your Employment Contract/Personal Service Agreement

We frequently provide legal counsel to physicians and other healthcare practitioners when their employment has been terminated or is about to be terminated. Unless the practitioner has an employment contract with the employer which clearly sets forth the circumstances under which employment may be terminated, terminations can generally be for any reason that is not illegal (e.g. illegal discrimination based upon membership in a protected class such as race, sex, religion, etc. or because the practitioner was a “whistleblower”). A termination from employment does not have to be because the practitioner has done something medically wrong. In fact, it is rarely about that. Most of the time, terminations occur because a practitioner is a “bad fit” for the employer, a determination which is made, like it or not, unilaterally by the employer. These terminations are characterized as “termination without cause,” legally meaning “for any reason or no reason,” but they occur because there is just a “bad fit.” As an example, an employer may not like how a practitioner speaks to patients or other practitioners (or both). If that is not corrected in the eyes of the employer, the practitioner may be terminated for cause (doing something wrong), but employers often use the “without cause” termination provision instead to avoid legal hassles and to prevent ruining the practitioner’s career. If you are terminated, regardless of the reason, it is very important to seek legal consultation. You will need to take the necessary legal steps to protect your career and reputation. You will likely need to consider a settlement agreement, release of liability and issues including pay, benefits pay out, malpractice tail coverage, noncompete provisions, reference letters, medical staff privileges and more. Walking away from a job without an agreed upon and executed separation agreement is NOT recommended because you will not have a documented understanding of what to expect and you will have nothing to enforce. Legal skills and experience with this type of matter are necessary to navigate this situation just as having an acute illness needs to be treated by a trained healthcare practitioner. Being terminated from a job is tough emotionally and dealing with legal issues on top of that is stressful. Following are some suggestions to help you should you find yourself terminated: Do not ruminate about how you have been unfairly treated. Instead, focus on moving forward and securing your next job position. Do not think that because your last job was a poor fit that they will all be that way. Instead, look for a work culture that is a better fit for your skills and personality. Do not be tone deaf. If you have been told that you "don’t get along well with others" but you do not see your own role in this, consider executive coaching. Tuning In To Your Own Behavior: Are You Tone-Deaf? (mbhealthlaw.com) Do not expect the legal necessities to be completed overnight. Instead, let your attorney guide you and aim for a Separation Agreement that is in your best interest but keep moving on. Do not think that being terminated makes you a loser and defines you or makes you unemployable. Instead, think that in the not-too-distant future (usually about one year) you will look back on what you will later call a "character building experience." You might even say, “Why didn’t I leave sooner?” Do not be a George Costanza and burn your bridges no matter how tempting. Instead, stay professional and courteous throughout the separation process and after. You do not know when you will need to reconnect. Do not sit around reliving the angst. Instead, do something constructive—what have you been putting off that will make you feel better? Give Me a Minute to Think: The Value of a Month Off (mbhealthlaw.com) Do not be unrealistic about expectations and expect an economic windfall from your employer. Instead, recognize that often the leverage is on the side of the employer and aim to negotiate and resolve the issues that are most important to you. Last but not least, always have your employment agreement reviewed by an attorney BEFORE YOU SIGN. I Did Not Have My Contract Reviewed By An Attorney Before I Signed It. Now I Need To Pull A Rabbit Out Of My Hat! (mbhealthlaw.com) For further information contact us .