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Stay at a bought-out private practice, or go to a struggling academic section?

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  • Stay at a bought-out private practice, or go to a struggling academic section?

    My wife is in her first year as an attending post-residency, working in a private practice. Over the weekend she was notified that her practice was bought out by another, larger practice, and that she has exactly one week to accept the new contract they are giving her, or quit. We are having an attorney review the contract, but some things are already obvious to us:

    1. The new contract will pay her based on collections, rather than a set salary, as with her old contract. My wife is not comfortable with that, as she would prefer not to be incentivized to see as many patients as possible.

    2. The new contract has very large non-compete zones, which would essentially exclude her from ever working again in this city, were she to decide to leave the practice. This is a problem, as we don't want to leave.

    At the same time, my wife is being offered a position as faculty at the academic institution where she trained (and where I am currently a tenure-track faculty). The problems with this position:

    1. The section is going through some very hard times right now: their section chief is leaving, and they have been having a hard time recruiting people as it is. They are down to just a few full-time faculty, and are nearing the point when they won't be able to support a residency program any more. It seems like a bad time to join the section. On the other hand, they are desperate, and it is clear that my wife would be in a good position to bargain.

    2. My wife did her residency at this institution, and has been working one half-day clinic a week there for the last 6 months. She complained every week about her half-day clinic, which would invariably turn into a full-day plus of work, with lots of time spent at home working as well. I am concerned that if she goes full time, she would be even more miserable.

    So, this is the decision she has to make very quickly. She is leaning towards going back to academia, although I am concerned she will be even more miserable than working at a patient mill, where she is pressured to see 60 patients a day.

    Are there any other things we should be considering? Thanks everyone for your advice.

  • #2
    It sounds like she already knows what the academic gig would be like.  You don't paint a great picture.

    Fee-for-service is a double edged sword.  I love it.  Just make sure that it is divied up based on the whole pot, not just each patient (i.e. nobody will want to see the uninsured/medicaid).  Coming from a salaried background, it will take some getting used to.  Being a capitalist/incentivized makes staying a little late more acceptable if it means you're getting paid more.

    That non-compete may be tough to enforce legally.  Particularly if they say she couldn't go on to work at a teaching institution?  (Sheez!)  It is even more unlikely to enforce legally if there is a draconian time-frame (more than a year).  It would be sub-optimal, but if she were to leave the group and non-compete for a year, could do locums or teach or do a fellowship at the local place.  Perhaps if the new group is open to negotation, you could change the non-compete to a non-solicitation language.

    Welcome to Corporate Medicine....

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    • #3
      It sounds like the academic job is a bad gig and you know that going in. The other job is an unknown. Nothing wrong with being paid for what you generate, I actually would not have it any other way and being salaried sounds miserable to me. Main thing to make sure is that the compensation is fair (if al you get is medicare/medicaid pts, your office won't stay open for long). Also, the non-compete, like the rest of the contract, is negotiable. Anything is negotiable. Get together with the decision makers in the new practice and see where their interests lie and start the talks.

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      • #4
        "she would prefer not to be incentivized to see as many patients as possible."

         

        Sorry if this sounds harsh, but I wouldn't just say welcome to corporate medicine as noted above, I'd say welcome to the real world.  Most of us make good money because seeing patients generates revenue and we are paid as a by-product of that revenue.  If she wants to avoid that then go into academic medicine, though it sounds like this particular academic section is pretty bad.  She probably should figure out what she would be paid based on her current collections and then decide.

         

        If both options are bad though then don't take either.  Do locums or urgent care or something while looking for something better.

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        • #5
          If she likes her current job, she should try to negotiate for better terms. If this is not acceptable, time to look for Plan C because the academic job sounds like helicoptering onto the Titanic right after it hits the iceberg.

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          • #6
            Alot of practices get burnt by the 'salary' approach and % of collections is the way to mitigate that risk.  You'll want to understand standard % collections for your wife's area and specialty.  Patient mix will also be a critical factor in a % collection to target.  As others have stated, I would negotiate very hard to restrict the non-compete area to say a 5 miles radius and explore the how tough your states non-compete clauses.  Another area to explore (and based a bit on specialty) is a separate % based on DME of OTC products that the practice sells.

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            • #7
              I agree with plan C or go to option 2.

              She doesn’t sound like a churn and burn type so even if you’re thinking you’re working like crazy in an academic gig, a real world private practice can be 100x worse imo

              The vast majority of academic places have at least some protection and residents to help. Plus the culture only allows those docs to be stretched so thin as most/many aren’t there to crank rvus or aren’t capable of cranking rvus (generalizing)

              The difficulty recruiting means she’s likely pretty stable even if a new chief comes in and tries to bring in their people.

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              • #8
                How many other possible positions in the city you are located?

                What type of non compete does the academic gig have for a short term transitional period?

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                • #9
                  I absolutely would not sign any contract with a noncompete clause that could potentially freeze you out of working in the town that you live in. Some may say it’s not enforceable but courts have proven over and over that it is. Do you have the time and $ to fight it in court if it comes to that? Ain’t nobody got time for that!

                  The academic gig sounds less than ideal. Why is the section chief leaving? Why can’t they recruit anyone? I assume because remuneration is poor and working conditions aren’t good (do half day clinics turn into full days because staff is slow and inefficient?)

                  I would be actively searching for another option...

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                  • #10
                    If the academic gig can't recruit then she probably won't be able to stay there.

                    Esp if she is relatively young and trained there she is likely to be treated by her former faculty as the new girl and a resident to boot.

                    If she does the academic gig she needs to be very firm with her dept that she is going to demand fair treatment and not get guilted into being their savior.

                    You mentioned they are having trouble keeping their residency? Well if the residents go her job is going to become even worse.

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                    • #11
                      Are there no other practices in town?  Being paid based on collections isn't necessarily a bad thing.  Depends on a lot of details.  She should get the numbers for her previous year and see how much she is collecting already..

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                      • #12
                        Is 7 days really enough to consider not having made these decisions under duress? Just sounds like the buyer is trying to scare people into terrible contracts, and it will probably work. Talk to a lawyer, find out what happens in the interim if she doesnt accept it. Finding other docs can be expensive if they dont have people to immediately staff the location.

                        While you'd likely be able to have an excellent made under duress case, you do not want to have to litigate, that just is truly awful.

                        On the one hand if she refuses and there is no crazy non compete with the academic center, she has 100% freedom, which is beneficial. Always check your state laws. I'd be looking for a way to get better positioning or at least enough time to set up a future gig. So I wouldnt accept a crazy contract in that case.

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                        • #13




                          Are there no other practices in town?  Being paid based on collections isn’t necessarily a bad thing.  Depends on a lot of details.  She should get the numbers for her previous year and see how much she is collecting already..
                          Click to expand...


                          There are other practices in town, but the noncompetes they want would restrict her ability to go to most. Anyway, we are negotiating the noncompetes, etc., before she has to sign or walk away this weekend.

                          They provided her the numbers for her previous 2 months, and they were far below her salary (based on percent of collections). Partly this is because she is new, and still building a patient base, and partly because she is working half of the time in an office that is slower, where they were trying to build up the practice. It seems pretty clear that she'll have to stop working at the slower office altogether (which is closest to our house). There was always a chance of that happening, anyway.

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                          • #14




                            Is 7 days really enough to consider not having made these decisions under duress? Just sounds like the buyer is trying to scare people into terrible contracts, and it will probably work. Talk to a lawyer, find out what happens in the interim if she doesnt accept it. Finding other docs can be expensive if they dont have people to immediately staff the location.

                            While you’d likely be able to have an excellent made under duress case, you do not want to have to litigate, that just is truly awful.

                            On the one hand if she refuses and there is no crazy non compete with the academic center, she has 100% freedom, which is beneficial. Always check your state laws. I’d be looking for a way to get better positioning or at least enough time to set up a future gig. So I wouldnt accept a crazy contract in that case.
                            Click to expand...


                            We have a meeting with a lawyer tomorrow. We'll be discussing all of this. Thanks!

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                            • #15
                              A full productivity based system is the fairest form of compensation.  It rewards hard work and evens out the effort between providers and tightens up the spread of the bell curve.   Non productivity based compensation incentivizes laziness, and ensures some docs can exist in a perpetual state of slow motion and getting tea, while being subsidized financially by the harder working docs.

                              Talk to them and explain that she's interested, but can't do the non-compete, period.  If they can't budge on it, thank them and walk out.

                              Find a third option.

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