Agreement between Hospital and Doctor

The importance of regulatory compliance cannot be overstated. Many legal principles apply to hospital-physician contracts, but three sets of legal principles are most acute in medical contracts. First, the Medicare Antikickback Act (42 U.S.C§ §§ 132a(a), ff.). This law makes it illegal to seek, offer or pay any form of compensation (e.g. B, money, goods, services, or valuables) to gain influence on the orientation of a patient whose care is paid for by Medicare, Medicaid, or another state payer program. Penalties for violations can include criminal convictions (including sanctions that impose custodial sentences and fines), civil fines, and exclusions from the Medicare program. Third, the principles that apply when a physician enters into a contract with a tax-exempt company. Many hospitals are exempt from federal income tax under section 501(c)(3) of the 1986 Internal Revenue Code. Tax-exempt hospitals must be operated for the benefit of the community, and non-exempt institutions or individuals can only benefit from them on the side. A contract between a tax-exempt hospital and a doctor may benefit the doctor, but if the doctor receives a fair market value for health-related services necessary in the Community, such a benefit is likely to be ancillary to the tax-exempt purpose of the exempt hospital. With the entry into force of the Provisional Sanctions Act in 1997, a physician who is able to influence the affairs of a tax-exempt hospital may be subject to excise duty if he or she and the hospital enter into an “oversupply transaction”.

This essentially means that if a physician who holds an influential position in a tax-exempt hospital is paid more than the fair market value for services or other valuables without paying the fair market value of those services or items, the physician and senior hospital officials who approve the transaction may be subject to excise penalties. Hospitals often present an agreement that includes standard conditions. Doctors should not blindly accept these agreements. An obligation to compensate may extend the physician`s liability for his or her actions or those of those under his or her supervision. A liability assumed by means of a compensation clause is in principle considered to be a “contractually assumed obligation” and therefore cannot be covered by medical professional indemnity insurance. Often, the right balance is only to provide that each party is responsible for its own actions and agrees to take out insurance for those shares. In other cases, compensation should not be reciprocal. A doctor may enter a complex set of hospital problems over which he or she has little control, but as a doctor, he or she could be a likely target in any lawsuit. In such a case, it may be appropriate for the hospital to compensate the doctor, but not receive mutual compensation from the doctor.

Good medical relationships are essential to the effective functioning of a hospital. A well-planned and well-formulated contract can dispel future misunderstandings and create a mutually beneficial relationship. A contract should be seen not as a necessary boilerplate, but rather as a tool that helps the parties define their goals and relationships. The objective should be not only to protect the parties in the event of a dispute, but also to avoid the risk of a dispute by proactively determining the essential nature of the relationship. 2. From the date of full performance by the parties, this Agreement supersedes all prior agreements related to the employment of the Physician and it is agreed that the terms set forth in this Agreement are the terms and conditions of the Physician`s employment with the Hospital from that date. Action stage Physicians should take a close look at non-compete obligations. You need to consider whether the hospital`s interests can be protected in any other way (for example. B, non-grouping of patients) or by a narrowly defined agreement. In addition, they must ensure that the agreement does not apply if the hospital violates the contract or if the hospital decides not to renew the contract. Physicians often leave it to the hospital to obtain relevant market data that supports their remuneration to be paid under a contract. Such information is essential in the relationship between hospitals and doctors, as many of the safe harbor rules of the anti-bribery law, severe legal exceptions, and presumptions under the Interim Sanctions Act require that compensation paid by a hospital be in accordance with fair market value.

Sometimes hospitals control the data and negotiate by force. In other cases, hospitals lack proper data or accidentally use incomplete data, thus negotiating in a position of ignorance. Survey data may be available or unavailable or relevant to a particular market and circumstances. Because of these circumstances, the physician is unable to negotiate the maximum compensation that would otherwise be allowed. To negotiate the maximum remuneration, the physician must ensure that he or she has access to the relevant fair market value data and understands the data. 3. The doctor, as Head of Cabinet, shall perform the role and responsibilities provided for in the Law on Public Hospitals, the provisions of the Law on Public Hospitals, as well as in the statutes, rules and directives of the hospital and as otherwise agreed between the hospital and the doctor. In general, a doctor will want to have a long-term agreement.

The doctor will make financial decisions, such as.B. recruiting partners, based on the expectation of having a continuous contract. That would mean that a longer period would be needed. Hospitals may be limited in the duration of the contract they offer because they have tax-exempt bond financing that limits the conditions they can have with others who use their facilities. It is necessary to know these rules and to ensure that the hospital interprets them correctly, since the duration allowed varies according to the method of compensation provided for in the contract. In addition, physicians must ensure that they begin contract renewal negotiations early. Indeed, they should consider including in the agreement a provision that requires rapid renegotiation. In addition, they should consider continuing to renegotiate a contract at an early stage in order to effectively extend its duration. For example, with a three-year contract, a doctor should think about renegotiating a year earlier so that he can never have only one year for a deal. The disadvantage of a longer-term agreement may be that the physician is tied to a compensation formula that is outdated.

Many hospital-doctor relationships are common and may well be integrated into standard agreements adapted to the particular situation of the parties. Renting an office is a good example. While it is crucial to read, understand, and (if necessary) modify such a formal agreement, it is still common to have an appropriate sample or lease agreement. On the other hand, many hospital-doctor relationships are unique. In such cases, it is important not to have the relationship defined by the written contract, but to ensure that the relationship that the parties wish to have is accurately described in the written agreement. Good legal counsel can help the parties explore the relationship they want and bind them to a binding written agreement. The goal is to ensure that the parties have a common understanding of their relationship and that the relationship commits to writing. Contracts between doctors and hospitals take many forms to deal with many relationships. Examples include medical director agreements, professional services agreements, exclusive service agreements, building and equipment leases, management services agreements, contractual joint ventures, and countless others. This section discusses 10 errors that are commonly made in contraction by hospital physicians. All of these mistakes have their roots in two major failures: the inability to have common expectations and therefore an ill-defined relationship, and the inability to recognize the importance of regulatory compliance. The practice of medicine mainly concerns the patient.

However, in doctor-hospital contraction, the physician may not have direct responsibility for patient care or may find himself or herself in a situation where he or she primarily assists another physician in providing care. Pathology, radiology, anesthesiology and, to a lesser extent, emergency medicine are examples in which the doctor not only serves patients, but also assumes an important role of advice or support. In these cases, other staff doctors are also the clients of the contracting doctor. The hospital, which wants to delight surgeons, wants to provide its doctors with timely and service-oriented anesthesia, radiology and pathology services. .

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