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Left practice, group cutting off Fee-For Service Residual payments

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  • Left practice, group cutting off Fee-For Service Residual payments

    I'm leaving a small private EM group in California.

    I worked for this single site independent group for 3 years total, 2 years as 'fee-for-service', and the first year as simple hourly. After 3 years decided to move on and gave an ample 6 month notice; because it's hard for this group to recruit.

    Through emails, the director verified that they will not be continuing to disburse anymore collections from my previous patient's as they come in over the next months. Their rationale is that the first year they paid me hourly and may have lost money on me, so therefore, this is equitable.

    I signed 2 contracts with them over the 3 years, the first was to negotiate the first year with hourly payments, and the second, a year later, establishing the 'fee-for-service' employment agreement. As best I can tell, there is no language in either contract stipulating what should happen upon leaving.

    This is unlikely to be a trivial amount of money, I suspect that it could reach $70-$80k over the next few months as the collections wind down. My questions are:

    1) Is it unreasonable to expect to receive the collections from patient's that I have already seen under a fee-for-service contract?

    2) Is it worth the time, money, and sweat to chase this down with an attorney? As an aside, the contract stipulates mandatory arbitration, should I invoke that on my own and see where the chips fall?

    Thank you for your help.

  • #2
    The rationale is bologna.  If you left after the first year, they would get nothing.  FFS on service rendered is just that.  The accounts receivable are on those in year 3, not year 1.    No wonder it's hard for this group to recruit with those types of practices.

    1.  Yes; that's you're earned $$$ under that contract.   They can perhaps charge a service fee for handling the accounts receivable after you leave, but you billed for those services.

    2.  Yes, if you can't come to an agreement on this.

    Before all that, i hope you've secured a future employment already.

     

     

    Comment


    • #3
      can you give less notice?

      i'm not sure what your options are if it is not spelled out in the agreement.  i don't think you lose a lot by pursuing arbitration if you are sure you are right.

       

      Comment


      • #4
        I gave 6 months notice in Feb, last day was end of June. I didn't have to give any notice according to the contract.

        Comment


        • #5




          The rationale is bologna.  If you left after the first year, they would get nothing.  FFS on service rendered is just that.  The accounts receivable are on those in year 3, not year 1.    No wonder it’s hard for this group to recruit with those types of practices.

          1.  Yes; that’s you’re earned $$$ under that contract.   They can perhaps charge a service fee for handling the accounts receivable after you leave, but you billed for those services.

          2.  Yes, if you can’t come to an agreement on this.

          Before all that, i hope you’ve secured a future employment already.

           

           
          Click to expand...


          I definitely had a better employment offer before I left.

          Comment


          • #6
            Their rationale is bull chips. Unfortunately for you, signing a contract that did not address this issue was a very bad idea. On the plus side, mandatory arbitration to make your case that they are refusing to pay you for services rendered will be cheaper than having to drag their cheap butts to court.

            As an aside, if I got this response, my last day would have been effective immediately. No wonder they can't recruit.

            Comment


            • #7




              Their rationale is bull chips. Unfortunately for you, signing a contract that did not address this issue was a very bad idea. On the plus side, mandatory arbitration to make your case that they are refusing to pay you for services rendered will be cheaper than having to drag their cheap butts to court.

              As an aside, if I got this response, my last day would have been effective immediately. No wonder they can’t recruit.
              Click to expand...


              In retrospect, I mishandled this, and I should have clarified this point long ago when I still had leverage and could have threatened to walk off.

              Comment


              • #8
                Its california, most contracts are effectively at will and month to month. Unless that clause/provision was written into the contract I would push back hard. California is very friendly toward employees/contractors and a simple hourly consult and letter head explaining your position from your lawyer will likely go a very long way. In all honesty they are just betting you eat this bs charge. Unless your current contract says so, this is simple sour grapes money grabbing.

                Not having contract language to cover every unimaginable scenario related to prior years contract is total bs and will not hold up. This is just as much fantasy as the fallacy of "if it isnt written down it didnt occur". Contracts would be 10s of thousands of pages if that were true. Your year 3 contract has zero relation to year 1, a first year law student would know this. They have no standing whatsoever. Year 1 contract is null and void.

                They are the ones that dont have any options unless you simply allow them to steal your earnings, they owe you everything as per this year 3 contract. It is not expensive to at least have it looked over by an attorney, I've had it done and its very useful.




                Through emails, the director verified that they will not be continuing to disburse anymore collections from my previous patient’s as they come in over the next months.
                Click to expand...


                Save these emails immediately. I will never cease to be amazed at the incriminating stupid stuff people put in emails. I have a gmail folder that i just transfer all contract/work/etc...emails to for future reference if needed.

                Mandatory arbitration is usually not in the little guys favor, its used to steam roll people, but in this case since they are so far off base it likely wouldnt matter.

                Comment


                • #9




                  Its california, most contracts are effectively at will and month to month. Unless that clause/provision was written into the contract I would push back hard. California is very friendly toward employees/contractors and a simple hourly consult and letter head explaining your position from your lawyer will likely go a very long way. In all honesty they are just betting you eat this bs charge. Unless your current contract says so, this is simple sour grapes money grabbing.

                  Not having contract language to cover every unimaginable scenario related to prior years contract is total bs and will not hold up. This is just as much fantasy as the fallacy of “if it isnt written down it didnt occur”. Contracts would be 10s of thousands of pages if that were true. Your year 3 contract has zero relation to year 1, a first year law student would know this. They have no standing whatsoever. Year 1 contract is null and void.

                  They are the ones that dont have any options unless you simply allow them to steal your earnings, they owe you everything as per this year 3 contract. It is not expensive to at least have it looked over by an attorney, I’ve had it done and its very useful.




                  Through emails, the director verified that they will not be continuing to disburse anymore collections from my previous patient’s as they come in over the next months.
                  Click to expand…


                  Save these emails immediately. I will never cease to be amazed at the incriminating stupid stuff people put in emails. I have a gmail folder that i just transfer all contract/work/etc…emails to for future reference if needed.

                  Mandatory arbitration is usually not in the little guys favor, its used to steam roll people, but in this case since they are so far off base it likely wouldnt matter.
                  Click to expand...


                  Thank you for your advice. I definitely have all emails, and I'm waiting to hear back from two different firms regarding representation. I'm planing to lay low and not engage or negotiate with them until I speak with someone more knowledgeable in this.

                  Comment


                  • #10
                    Let me try this explanation:

                    As I understand it, the first year you were salaried, so there is no beef.

                    Years 2 and 3, you were compensated based on your billings (collections minus expenses), correct?

                    Did you continue to draw salary immediately after Year 1, in month 13? If you did, this would have been before the collections of month 13 would have hit the books, and you were essentially being advanced your salary at that point. In other words, they paid you your month 37 AR draw in month 13...and month 38 in month 14, etc.

                    If you did not receive monetary compensation in month 13, you do have a legitimate beef, no matter what the contract says. Speaking of which, I have never heard of a professional contract that does not have separation language. Seems strange...

                    Comment


                    • #11


                      Since no language you are screwed It will cost likely more to litigate If it’s a lot of money then I’d do the arbitration but you should compute a fair situation from your first year and see how much you really are owed or not owed if it was all production.
                      Click to expand...


                      I am not a lawyer and this certainly isn't legal advice - but having experience writing a number of agreements/contracts of different sorts, I can add to conversation that generally the burden is on the 'writer' of the contract for situations not explicitly addressed in a contract. So in other words, i would suspect that assuming the group is the writer of this contract, and if they didn't include language for this situation, the courts will be much more sympathetic to the signer vs. the writer.

                      Sometimes 'no language' is really a not so insignificant positive for the signer simply because they get benefit of the doubt - of course that'll take lawyers to resolve.

                      Definitely worth pursuing for DrwOOkie.

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                      • #12
                        If nothing else, be a decent person, and tell your previous colleagues.

                        Comment


                        • #13




                          If nothing else, be a decent person, and tell your previous colleagues.
                          Click to expand...


                          Unfortunately, I already had an idea this might be coming, another fee-for-service group member left last year and the same thing happened. She chose not to pursue it. I guess I supposed that since I left under better circumstances it would not happen to me. Obviously I'm learning my lesson about assuming anything.

                          Comment


                          • #14




                            Let me try this explanation:

                            As I understand it, the first year you were salaried, so there is no beef.

                            Years 2 and 3, you were compensated based on your billings (collections minus expenses), correct?

                            Did you continue to draw salary immediately after Year 1, in month 13? If you did, this would have been before the collections of month 13 would have hit the books, and you were essentially being advanced your salary at that point. In other words, they paid you your month 37 AR draw in month 13…and month 38 in month 14, etc.

                            If you did not receive monetary compensation in month 13, you do have a legitimate beef, no matter what the contract says. Speaking of which, I have never heard of a professional contract that does not have separation language. Seems strange…
                            Click to expand...


                            The timing is a little confusing, paid on a 30 day period. So month 2, received month 1 hourly pay and so on. Month 13 received month 12 hourly pay. Month 14, received that totality of collections for month 13, minus malpractice, billing company fees, and an administrative fee.

                            Comment


                            • #15
                              You are obviously a very decent and nice person. Sounds like your former colleagues are very good at hiring physicians who assume the best, take it on the chin, and move along quietly - glad you're standing up for yourself.

                              As pulmdoc said, no wonder they can't recruit. I hope you have a more specific contract this time.
                              Working to protect good doctors from bad advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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