Educational leave, sabbatical, parental leave, extended illness, and practice closure due to relocation, retirement, or better professional opportunities can all lead to the decision to leave a practice.
When thinking about this type of change, there are many issues to consider, including tangible and intangible assets, continuing patient care, and—in the case of retirement—the emotional aspects of leaving. The best way to prepare yourself for closing, selling, or handing over your practice is through planning.
When considering leaving your practice, there are four main issues you will want to address: your physical office space, records and contracts, professional relationships, and malpractice and tail coverage.
Preparing to Leave Your Office Space
The first issue in discontinuing practice is your physical office space. If you lease your space, you should review the terms of your lease for the specifics of termination or transfer of lease. If you own your space, consult with advisors to determine if the property will serve you better if it is maintained or sold. You will also need to contact both your accountant and attorney to identify the best plan for proceeding in a financially profitable way. You don’t want to be forced to sell to the first bidder at the lowest price, so timing is important.
Managing Records and Contracts
Issues related to the handling of medical records should be identified and managed at least six months prior to cessation of practice. You will need to obtain a copy of the state’s medical record laws and rules to identify how long and where you will need to maintain medical records. If you will be selling your practice, the records may simply go to the physician purchasing the practice. If you are not selling, ensure that the handling of records is secure. You will also need to identify how your administrative records should be handled. Verify how long you will need to store records relating to your malpractice policy, corporation/practice documents, liability policy, business records (billing slips, encounter forms, accounts receivable, remittance advices), bank records, employment records, tax records, and legal documents.
When looking at the contracts that bind your practice, you will need to enlist the help of your professional advisors. Your attorney and accountant can help you to pick apart all contracts and mitigate any potential problems. This includes the review of employment agreements, managed care contracts, insurance policies, and shareholders’ agreement if applicable. Review these closely, and pay attention to advance notice provisions, noncompete covenants, and statements regarding accounts receivables and disbursement of final pay. These documents will detail what you have promised to do and the practice’s obligations toward you. The advance notice provisions will help you to establish your departure timeline and keep you in compliance with the requirements of the contracting managed care organizations.
After you have seen your final patient, destroy all remaining prescription pads and contact your local Drug Enforcement Agency (DEA) office for guidance on filing and eventual destruction of your narcotics ledger, as well as information on the approved method of drug disposal. Remember, when destroying any confidential records and prescription pads, the safest course is to shred using a reputable company, keeping records of what is shredded and obtaining certificates of destruction.
As you look at these contracts and paperwork, it is important to go by the book. You never know when you will need a reference from your former employer or partner, so don’t burn any bridges unnecessarily. Ask each organization if they have any policies regarding notice and the handling of medical records, and provide a forwarding address for each organization.
Professional Relationships
In the months just before you discontinue your practice, notify your patients, colleagues, office staff, federal agencies, local DEA office, and all outside companies and third-party payers with which your practice is in contract. The first party that should be notified will be your colleagues and staff. It will be difficult to keep the news of your departure from them, and they will likely pick up on rumors. Taking a proactive approach and discussing your plans with them as soon as you have decided to leave is necessary to maintain good relations with those who work closely with you. You will want to have their help to keep activities and events involved in the departure organized and unproblematic. Your colleagues or partners will need to have advance notice about your departure so that they can prepare and plan for business disruptions and possible workload increases as your patients seek new physicians to attend to their care.
The ACR does not have a policy in place that states a firm date or time period for notification of patients. It is a good practice, and along the ethical guidelines of the American Medical Association, to give your patients, “reasonable notice and sufficient opportunity to make alternative arrangements for care.” This should be at minimum 30 days prior to your scheduled end date. Check with your state medical society to verify whether it has a set policy regarding the method and timing of notification. Most states only say that patients should be given ample notice to make alternate arrangements for care and that the physician should make sufficient attempt to notify all active patients, but some are more specific.
After sending out your official notice to patients, you will likely experience dramatic increases in appointment requests from patients who want to discuss their health concerns, plan or talk through options for continuing care, or just to say goodbye. It may be beneficial to plan ahead with staff and develop responses to anticipated questions. Remember that, for some patients, ending the physician–patient relationship will be an emotional experience, and appointments may take longer than usual. You should plan for additional time to reflect this need.
Covering Your Tail
The timely notification for all individual organizations affected by your departure is an important step to ensure a smooth transition. Malpractice carriers should be consulted first. You should have adequate coverage of all claims that are filed after your departure, and you may need to obtain a supplemental policy, or tail coverage, to insure you for claims made after your employment is formally terminated. Tail coverage usually costs between 1.5 to 2 times a physician’s annual premium, and you will most likely be responsible for securing this policy, so be prepared for this expense. If you will be moving directly to a new practice, try to negotiate tail coverage into your employment contract. Many employers will provide tail coverage or may be able to provide coverage with a retroactive endorsement date.
Planning to leave your practice is an inevitable part of the career cycle. Whether you are leaving to enjoy retirement or to pursue another endeavor, it is important to plan and execute your departure well. For more information on issues relating to the cessation of practice, contact Itara Barnes at [email protected], or visit ACR’s Rheumatology Career Center.
