Purchase and Sale Agreement Medical Practice

Negotiating assigned contracts can become a big deal. Unfortunately, some doctors sign the document presented to them by the seller as a “standard contract”. As a result, practices are often signatories to long-term commitments without termination provisions. Compensation terms must be negotiated. Many health systems want unlimited and indefinite compensation for the “first dollar.” Your lawyer will try to limit the survival of these compensations (i.e., how long you are required to pay), limit the amount of compensation (at least to ensure that the indemnification obligation does not exceed the purchase price), and insert a materiality provision to prevent the “nickel and diming” of the health care system (p.B. If it turns out that a few dollars of supplies were not available when it closed, you don`t need to cut a check for a few dollars). In this regard, various trade-offs are possible, ranging from limiting the total amount of the indemnification obligation to developing “baskets” of various potential liabilities, so that, for example, an undetected tax privilege does not require a refund that exceeds the value of the underlying fixed assets. One of the first things you need to do is make sure that everything that has been agreed in the letter of intent is included in the final agreement. This bulletin provides a general overview (and certainly not an exhaustive summary) of some of the considerations that parties may take into account when navigating the purchase or sale of a doctor`s office. Given the regulatory environment in the healthcare industry and the business-related issues associated with the transaction, the parties are well advised to consult with healthcare legal counsel from the outset to prepare for a potential transaction (both on the buyer side and on the sale side) and to manage the transaction from initial discussions to the closing of definitive agreements (and after the closure). Each party will seek from the outset to maximize its respective position (and interests) at each stage of the transaction.

In addition, due to the nature of many small practices, it is not uncommon for personal property in practice to belong to the doctor. In many cases, even if the practice owns the asset, the physician still considers it to be their property. For example, laptops and artwork are often “not for sale,” even if the practice has paid for it. Making a list of what is being sold can be difficult. Often this is done as a room through the inventory of the room. If the practice is sold, the physicians who sell and buy the practice should determine who is ultimately responsible for the medical records when selling or transferring the practice. If medical records are transferred as part of a practice sale with other assets, the seller must inform and inform patients of this transfer in order to comply with the terms of the asset purchase agreement, licensing requirements, and ethical and professional standards. Physicians must also determine the structure of the transaction and determine whether the purchase and sale agreement should be a share purchase agreement or a purchase of securities. Your guide to securing assessment, changing roles, transferring medical records, and informing patients.

The liabilities of the practice should also be included in a list of the purchase-sale agreement, which includes those assumed by the buyer at closing. These may include: Negotiations regarding the sale of practices and all related documents, including the purchase-sale agreement, must be conducted in accordance with all applicable state and federal regulations, including: fraud and abuse laws, the Stark Act, the Anti-Bribery Act, HIPAA, tax exemption status (if any), antitrust laws, and state and federal regulations regarding the transfer, maintenance and retention of patient records. It can be difficult to make a list of current expenses that the health care system is willing to accept. In addition, the list of excluded assets (which retains the practice) and excluded liabilities (obligations that the hospital will not assume) can be the subject of extensive negotiations. Physicians who close their practices should consult with their lawyer about the storage or destruction of medical records and consider giving patients notice and the opportunity to retrieve their medical records prior to the closure of the practice. When identifying patients who have been treated by the practice, doctors should send a notification letter that: In general, claims when buying a practice are not an acquired asset and therefore are not sold to the buying doctor.. .