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Grand Rounds-Hospital Employment or Private Practice Part II: Private Practice and Contract Negotiat

Jim Bean and Richard Wohns

October 15, 2012

Transcript

- Hello, ladies and gentlemen, and thank you for joining us for part two. A discussion regarding hospital employment versus private practice. Dr Jim Bean from at Baptist Central neurosurgery in Lexington, Kentucky provided us with part one regarding advantages and disadvantages of hospital employment. Part two, that will will follow shortly will discuss the advantages and disadvantages on the small to medium sized private practice by Dr. Rich Wohns and JD MD, MBA from South Sound Neurosurgery in Washington. Gentlemen, thank you for joining us.

- Thank you, Aaron. Jim, thank you for your excellent presentation. What I'll do is I'll summarize a few of the points that you spoke of so eloquently, and then I'll move on into my presentation. So why are we here today? It's because employment is a growing trend. Merritt Hawkins few years ago showed that more than 50% of graduating residents and fellows are going into employment positions. And I just read the latest statistic. It's now up to 65%. So it's very important for our younger colleagues to really understand this and look at all the options available to them very carefully and more than half are going into the hospital employment arena. I'm remaining in a solo or a small group sort of setting. We have four doctors. I feel like it's almost a solo practice because I run it like a solo practice even though I have a small group, it would be very different. If we became a hospital employees, as you mentioned, you have colleagues, you have hospital administration. We make most of our decisions the same day and get action on it same day. And as business manager of my practice with my business background, I make decisions every day, all the time act on it immediately, and don't have a bureaucracy to deal with. So the reason that we're doing okay, and remaining in a small group practice, despite the financial pressures, despite the increased overhead, despite the diminishing reimbursement is because of our ancillary income stream. So I think that in this day and age, the only way that a small group practice or a solo practice would be viable for a young graduate or a residency or fellowship is in a state that has CON that allows for development of ancillaries. If it's a non CON state, that's not an issue. So you have to look across the country as a young guy coming out and say, if you wanna be in a private practice, is it CON or non CON? If it's CON, is it a difficult environment or is it something that's doable? For instance, in Michigan, it's very, very difficult, Connecticut, very difficult to do anything entrepreneurial and create ancillary income streams with surgery centers and other ancillary forms of revenue. Other states, where there aren't such regulations, it's easier, but you still have the question of how to fund these things. And you have to be a full event, animal spirits of an entrepreneur in order to stomach this in this day and age, because you're signing dead instruments. You may be having to put your own equity in, and it's not just like signing a contract and getting a guaranteed salary with bonus when you're a hospital employee. I like that. I'm an entrepreneur at heart. I've started companies. I look at my business in neurosurgery as Jim knows very well we've had presentations on the concept that it's no longer just a practice that has to be considered a business. You have to think of it as a business from day one, manage it as a business from day one. It's no longer just hanging up your shingle and being available, able, and affable and setting up a successful practice. It's a business. So moving on, I feel like a dinosaur and it's not bad to be a dinosaur. So you don't... as long as you don't walk into the library tarpits and sink and then become extinct. So I think it's still a viable way of practicing. In fact, I'm gonna go out on a limb a little bit and state that I think we're seeing a pendulum swing towards hospital employment that I personally believe is a non-sustainable economic model. And I think again, personal opinion, without any substantive data in the literature or a Merritt Hawkins or MGMA data to back me up, I think we'll see the pendulum swing back towards more private practice models as time goes on. What we're seeing now, I believe is a shift that is simply not viable from a market analysis point of view. The salaries that are being paid by the hospitals are basically not sustainable numbers going forward, simply because they're going to be ratcheted down in their payment models, and physician salaries which are guaranteed as Jim nicely pointed out for one to two to three years, very rarely more than three years in the contract are not written in stone. They will be ratcheted downward. If hospital incomes are a downturning because of either payment schemes or management of profitability or other service lines failing and cost shifting. So just because you have a good salary to start with now, does not mean that that hospital promises that for the rest of your career. So we'll see, but going forward my prediction is that private practice will come back. I think it's in our veins, it's in our spirits and in our genes to be more independent than hospital employment allows, but I may be wrong. So given that, we still have to deal with the fact that hospital employment now is more than 50% of the marketplace, and it involves a lot of issues and it's issues that the physicians have to face, the hospital's patients and the government has to face, and I'm gonna go through that this a little bit. The issues include a doctrine called the Corporate Practice of Medicine. It includes a fiduciary duty to serve the hospital employer once you're an employee. There is an inherent conflict of interest between the ethical duty to be a doctor caring for patients, and the fiduciary duty as an employee to serve the hospital employer. There's a conflict of interest in medical legal liability, whether direct hospital employment improves or adversely affects access to care is a big issue. Employment contracts are an issue. So I'm gonna go through these issues, line item. Corporate Practice of Medicine doctrine. What is it? It's a prohibition for corporations to provide professional medical services, basically. It bars employment of physicians by hospitals in certain states. It's not a doctrine in all states. California, Colorado, et cetera, are active Corporate Practice and Medicine states. So it really is a minority of states, but where it is in effect, it's very important to recognize. So for instance, in Texas, you don't see a lot of employment by hospitals of physicians because of the Corporate Practice of Medicine bars that. It was created by the AMA to protect the public as well as doctors. Is to protect patients from the divided loyalty and impaired competence between the interest of a corporation and the needs of a patient. Jim, do you have any comments on Corporate Practice of Medicine or should I move right along?

- Well, let me say, I think the Corporate Practice of Medicine is very important in the states that it's in, and the concept that there is this conflict of interest inherent in employment, has to be understood whether there is a legal doctrine in the state or not. Those who get employed by hospitals should understand the purpose of the Corporate Practice of Medicine legislation that was passed 100 years ago to try to protect patients from a doctor's point of view so that the doctor could practice ethically, have the patient's interest foremost in mind and not the institution's interest, because you may make recommendations for patient to care they're gonna lose money for you're employing institutions. You've got to be careful that, if that's necessary you stand by your ethics and do what's right for the patient.

- Very nicely stated. The key thing in the Corporate Practice of Medicine, as you've mentioned is that you're still a doctor. You're not just an employee and a profit center for the hospital. We have to make decisions ethically based on what you would do without any financial strings attached. So very critical. And as you very nicely stated whether or not the Corporate Practice of Medicine doctors is in play in your state, it doesn't matter. You're still a doctor. You still have your ethics. You still are taking care of the patient primarily, you're not taking care of the hospital's bottom line. Unfortunately, on the other side of the fence, the hospital administrator may look at you strictly with a dollar sign on your forehead, and unfairly terminate you because you are not profitable and you're making decisions that costs the hospital money instead of looking to increase their profit, you're spending more dollars than they think appropriate. They also, on the other side of the fence may look at non-employed doctors and push your deal as an employed physician over the non-employed physician because of the profitability of the higher doctor. And this is creating a rift in some communities where there are physicians who have remained independent, there's a Corporate Practice of Medicine Doctrine in place, and hospitals terminate privileges of non-employed physicians, because they can control the profitability of the employed doctors, patients stream better than the non-employed stream. So it's just another part of this to think about. The overriding public concern, and I just wanna quote it for the record is, "Lay persons are not influencing the professional judgment and practice of medicine by physicians." That's what the Corporate Practice of Medicine is all about. A lay person includes hospital administrators, CFO's, COO's of the hospital, whether or not they're doctors, in this situation, they're considered laypersons. They're not taking care of the patient. The doctor is taking care of the patient. As we said, and I wanna stress this, their sole interest, employed or non-employed, not unemployed hopefully, but not employed. Physicians sole interest is ethically to their patients. They do not have a legal duty to make the hospital money. And that's what we want to avoid according to Brent Michelin from the California Medical Association. So the fiduciary duty to serve the hospital employer. This is the segue into the next issue. So the employed physician may lose the freedom to make decision based on patient needs, the method and manner of patient treatment and by means that the patients are left treated has to be in the sole discretion of the physician. So imaging studies, laboratory, site of service for instance, if an employed physician thinks it best to refer the patient out of the network that they're employed by to get better quality care, or to get a consultation for a non-employed physician or a particular type of imaging or second opinion, it's something that may be lost when you're employing. So when you're a private practice, one of the things that I pride myself on is that if I need outside help, I can go anywhere in the world for that. If I want to send a patient to Jim Bean in Lexington or Aaron Colin in Indiana, I can do that. Nobody tells me I can't do that. It's not part of my purview as a physician, I have to stay within the network. I can bring the patient to a different hospital than where I usually work, because I have privileges there. I think that the facility there may be handling it better. If it's a particular sub-specialty type of thing or a particular type of imaging, et cetera, nobody tells me how to best take care of that patient. It's my decision. You lose some of that as a hospital employee, or if you don't lose it, you risk your contract. And you could be terminated, and there are cases that have hit the literature already were employed doctors don't use the network for instance, for subspecialty care. And it was a case in Colorado where a family physician did not think that her network had the best players in particular subspecialties and referred out and was warned, continued that practice for the best interest of the patient and was terminated. And there was a legal case of whether she was rightly or wrongly terminated, but as Jim pointed out, it's an at-will contract. So there is no cause necessary for termination beyond that 30, 60, 90, 120 days. And she was terminated and she had no legal recourse. Jim, do you have a comment on that?

- Yeah, I think it's important. And there should be mentioned even in your contract, and it will commonly say... you will be encouraged to use the internal referral network, but that if in your best medical judgment, it should be done outside that that is within your right as an employee to do. And that, you should look for that in the contract. You want some assurance that if you have somebody who's needs to, has brain tumor, you wanna refer because they've got a better treatment somewhere else. You wanna make sure that you can do it without having to justify every one of these to a medical director, your medical judgment should prevail and in your contract should reflect.

- So given that conflict of interest, you can write it into your contract, that if you make best decisions for the hospital, but once in awhile, you make decisions that don't look like they're the best for the hospital, and that the hospital loses financially. But if you can justify that because of patient care, that that should not be grounds for termination. So moving on to some of the other issues with ACO is now being in effect, I think it's very critical for the doctor interested in remaining in a small private practice to recognize that they can remain independent, but they do have to join an ACO because the payment stream will be going to larger organizations than the average small practice of one, two, four neurosurgeons or paying physicians or neurologists and neurosurgeons combined. It'll be to a larger organization. And so you can join an ACO as a small group to make sure that you will be part of the revenue stream and you will have to negotiate exactly what your payment scheme will be. But the ACOs in your community will be controlling the healthcare dollar. You will no longer be able to receive fee for service, maybe even your ancillaries, but that's not written into ACO yet, but your fee for service, your professional fee very likely will be targeted to an ACO. And you will have to create a way of getting payment for services provided under the Aegis of the ACO going forward now that Obamacare has legislated ACOs into existence starting in the next a year or two. So if you remain in private practice, make sure that you become affiliated with at least one ACO, and there's no restriction on how many ACOs you can join. So most ACOs in your community will want you as part of them, simply because it increases their capability of providing more care. And they won't look at you necessarily as a competitor, but as a supplement to their ability to provide more comprehensive care and bring in more revenues under the ACO model. Jim comment on that.

- Yeah, I thought in the, looking toward the future. These are immediate needs in deciding where you're going to practice and who you're gonna contract with. ACO is out there, a couple of years, three years, four years, somewhere down. It's not the immediate consideration, but when you're looking to settle into a practice where you're gonna be long term, that has to be part of the consideration now. How are you going to make those contractual arrangements, whether it's employment contract or it's a participation contract in the ACO. You've got to look at that as part of the formula for deciding which kind of affiliation you want to have. Very, very important. Not an immediate concern, but it will be growing.

- I agree. I think it will be on the horizon in the next couple of years, but it's something that if you're going into the private practice, you need to plan for now. And I believe that the shared management way of dealing with a larger facility as an independent small group, this is the way to go so that you have a voice in how your cases are managed, what implants are used, the cost of care that the hospital has for your type of patient is something that you should be involved in even as a non-employed physicians, because it's gonna make a difference for your financial viability in the future. So if you're looking at a private practice, the practice should have a good relationship to a hospital that could possibly be the ACO basis going forward and shared governance, shared management of patient care, I believe is something that should be instituted in an early stage. If the private practice has stark potential issues related to ancillaries, this whole thing about joining an ACO, becoming an employed physician at least will make the stark and anti-kickback issues less relevant. But it's very important for those in private practice to understand that your practice is gonna be looked at more and more carefully, and you'll be in the bullseye of the local office of the inspector general as private practices become more and more of a minority. There will be issues that come up as to whether or not the local hospital wants you to remain viable. And there will be my believe more whistleblower. There'll be more OIG investigations, the issues of how you educate your patient as to ownership of your ancillaries. All of this is important to understand now, but more important as hospital employment becomes more and more and more prevalent with majority of physicians being in that arrangement, it is going to make you more of a target for an investigation. So your ancillaries have to be stark proof and anti-kickback proof. And it may all be a moot point if you become a hospital employee. The whole concept of stark and anti-kickback may become a non issue if everybody becomes an employee because the large organizations and ACOs included, even if it's not all employed physicians may not have stark issues, because it's all gonna be under one roof administratively, rather than anything that allows the payment scheme to look like a kickback to the private practice. So very concerning now, very concerning going forward. Issue a stark violation is a serious federal offense and practices now who set up ancillaries to be financially viable in the future. Practices that have ancillaries need to make sure that their attorneys have created a stark proof arrangement, MRIs, gamma knives, cyber knives, surgery centers, physical therapy, durable medical equipment, et cetera. All of this is looked at potentially by the OIG as an opportunity for a potential anti-kickback or stark investigation. And all I can say is that, for those who are setting these up work very carefully with healthcare attorneys who understand the issues. For those that have them, that is their ticket to financial security and maintaining independence, make sure that they will remain stark proof and anti-kickback proof.

- Rich I'm going to just interject something, and I expect most of the listeners will understand what stark and Anti-kickback is, but just as a refresher. Stark self referral restrictions, refer to those patients that you see and then send to some venture in which you have an investment in potential income, so that money spent on that recommended service comes back to you. So that's what stark refers to. The Anti-kickback refers to the possibility of referring a patient to a hospital for treatment, and getting some kind of remuneration back from the hospital, not your own investment, but remuneration back from the hospital for the referral of the patient therapy service. That's the distinction between those two legislated items.

- Thank you, Jim. The other anti-kickback issue that I'll bring up since we're defining things that relates a lot to how surgeons grow practices, and you were mentioning that you still have to grow your business no matter whether or not you're an employee or remain in private practice. One traditional way of growing your business is by taking doctors out for dinners or wining and dining, or sending gifts or et cetera. These are now potential anti-kickback violations. So as you know, Pharma no longer can and can do the cruises and fancy golf tours, and meetings are very carefully legislated as far as what's paid for and what's not for the doctor who's speaking at meetings. If they're being hired by either Pharma or a medical device company. What's true for the neurosurgeon that wants to build his practice or take care of his referral base, be very careful not to be sending out gifts or having fancy dinners, or bringing them on golf junkets, or trips to Las Vegas. These are now looked at very much in the scans, by the anti-kickback regulators, and people who look for violations. You can't develop a practice anymore with high financial gain to your referral base. You're buying referrals. It's not just referring to a hospital, but it's getting people to refer to you. That's being looked at. So unless you wanna add anything to that, I'll move on to another issue that I think is very important. That is not really discussed in much detail and all that is somewhat counterintuitive. And I wanna develop this concept a little bit. Having just graduated from law school and spending a lot of time in liability courses. One of the things that they drill down and they particularly drill down for my benefit as a physician lawyer, is that just because you become an employee of a hospital, doesn't mean much as far as your liability exposure. Liability is still yours. It's on our shoulders as neurosurgeons, as doctors. The hospital is a joint what's called tortfeasor in claims against employed physicians. They may or may not be joint tortfeasors meaning jointly liable in a situation where a physician who is not employed is sued. Oftentimes the plaintiff's attorney will send out subpoenas to everybody under the sun in a situation where you have physicians who are not employed by a hospital. They'll send out a subpoena to the hospital where the patient received care, maybe to the referring doctor, an ER doctor, the neurosurgeon, et cetera. But clearly when you're employed, the hospital always is a joint tortfeasor. Because under the employment contract, they are the person, the party sorry, that maintains your employment contract and thus responsible for what you do. But in the end, you are the ultimate responsible party for a lawsuit. As an employed physician the problem is you may not be the decider as to how suits are settled, versus whether they're tried in a court of law. In contrast to when you're in a small group like myself, if I'm sued tomorrow, I can decide to settle. I can decide to go to court. And it's my fate that I control. What the hospital does if they're named as a party, is totally up to them. They don't control how I look at the case. And the reason that this is important is that when physicians are looking at lawsuits as an independent party, they're looking at their reputation, how much this is going to affect them in their practice. What the possible downstream effect would be in terms of the National Practitioner Data Bank, will it raise their malpractice premium? Will they lose their ability to become covered, will lose their position in the community? Is it an ego thing? Is it something that really they don't wanna deal with as a settlement, which goes on their record forever? Would they rather fight it in court? Get their day in court show that they didn't commit any malpractice. There was no negligence involved. It was a frivolous case. They'll fight it to the end. They don't want to pay a penny. If you pay more than a few thousand dollars, you can end up being in the National Practitioner Data Bank. I believe it's a $10,000 in some places it's any payment. So if a physician on his own, you know, solo or a small group says, I'm gonna fight this. They can do that. If they're an employed physician, they can't say that. The hospital becomes the decider because they look at it as what is the cost to us of settling the suit, making it go away, versus the potential upside to the plaintiff, by bringing it to court, knowing that there is a deep pocket such as a hospital, that more likely the jury would award a larger settlement or judgment to if it goes to jury judgment, that the hospital does not wanna become exposed to. So all of a sudden the physician is not in the deciding seat and ends up being the pawn. The hospital says, "This is worth $50,000 to make it go away. We don't want the potential of a runaway jury judgment of $2 million or something out of control. We can't deal with that. We can afford the $50,000 settlement." But what happens? Who is filed in the National Practitioner Data Bank? Is it the hospital or is it the doctor? Is it the neurosurgeon? It's the neurosurgeon. So all of a sudden the hospital is somewhat sacrificing the doctor for financial purposes, not looking at what's really in the best interest, potentially the doctor's reputation. The NPDB, the National Practitioner Data Bank is something that is a black mark on the reputation of the doctor going forward. It almost makes it, and this was my somewhat jaded legal opinion coming out here, but it makes it more difficult for that employed physician to say at some point in the future, I'm done with this, I'm going back into practice. I wanna become a solo or independent guy again, or I wanna move and go to a different hospital system or move out of state. Once they're filed as a National Practitioner Data Bank data point, it's more difficult for them to do everything, to become independent, to go and get privileges in another center, to move to a different state, to get malpractice coverage. So it's something to consider. This is, I think, one of the unstated issues in signing a hospital contract as an employee. Now, this is something that can be worked on yes , as cogent potential employee when you're in the negotiation process. Before you sign your contract, you are in the driver's seat. The hospital wants you. They recognize your contribution margin, potentially. That's why they are paying the big salaries. They recognize that if they pay 500,000 or 700,000 or whatever they pay for your guaranteed salary, plus your bonus, they may be making 3 million, 4 million or more, in their contribution margin, so their bottom line. So they're realizing a huge gain by you bringing in your neurosurgical practice, either an existing practice or the growth of a new practice to the hospital. So they recognize what it costs to bring you in the door, but they also recognize what you're worth to them. So before you sign the contract, you're in the driver's seat, you can say this salary looks good, but I don't like the fact that you're gonna decide when and if to settle, or whether or not to go to court on a case that might come up where we're jointly sued when I become an employee. I want the final say so. You can write that into your contract. You can negotiate that. And I would highly advise that that sort of thing be discussed on going forward.

- I agree.

- The final issue I wanted to discuss. And then I'll summarize all the points that I'm concerned with regarding hospital employment arrangements. And it's not like hospital employment is bad. It's just, these are the things you need to recognize if you're gonna do it. And I think it's here to stay for at least the next few years. I don't think it's here to stay going forward. I've expressed that, but you have to think short-term and long-term, if you're at practice neurosurgery. In the short term, it's 65% of people doing employment contracts. So let's talk about employment contracts. It's not something that you should just look at and sign where the attorney or where the hospital puts the little sticky arrows. This is something you should spend hours on and go over with a fine tooth comb with your attorney. Don't take anything for granted. You're gonna get boilerplate sometimes from hospitals and hospitals have more bargaining power than positions. Position contracts are usually on to take it or leave it basis. They're considered in the legal profession as contracts of adhesion. They do not have to be that way. As I mentioned, when I was discussing the medical legal implications of being employed versus remaining either solo or small group, contracts are negotiation instruments with huge power in both parties prior to signing. No power in the party that has gotten all the concessions after signing. So the physician has the duty to himself or his own or her own survival status after becoming an employee to pay attention to every word, every clause, every concept in the contract. So contracts contain lots of things that are boilerplate by the hospital that are just handed to the doctor. But you don't have to assume that you have to sign them. If you see, or without cause termination clause in your contract, non-compete clauses, binding arbitration clauses, you can negotiate those out of the contract. You can go for with cause. You can say, I don't like the fact that I'm coming here from across the country and moving my family, and setting up practice, giving up other opportunities. Yes, you're giving me a good salary and good benefits, but you can fire me without cause in 30, 60, 90, 100, 20 days, I don't like that. I want with cause, I want to have to be convicted of a felony or some agregious medical negligence or ethical error of judgment that via a third party committee is considered clearly grounds for termination. That would be with clause. You can negotiate that into your contract so that you're just not potential target by the hospital administration if they don't like you. If you're not running your numbers according to their expectations, or if you don't get along with somebody that's senior in your group or a referring doctor without cause is very worrisome to me. So consider that a red flag in the average contract that you're gonna receive from a hospital and sit down and negotiate that. The non-compete clauses. In many jurisdictions, Washington state included, non-compete clauses are upheld in court as long as they're considered reasonable. And reasonable might mean depending on the geographic region where you're working might be a 10 mile radius, or it might be some other definition of a defined target area around where you are. It might be for instance, if you're in a community where you've had an existing practice and you become employed by the hospital, you give up your practice. Your non-compete is so rigid that if you want out of your contract, you don't have a practice to go back to because it becomes something that the hospital can sue you over if you try to go back into the same community that you were in for five, 10, 20, or 30 years prior to becoming an employee. So think about that non-compete clause and negotiate that. Most contracts require some sort of non-compete clause in order for your remuneration, your employment salary or benefits or your bonus. Something is usually tied to your acceptance of a non-compete clause. That's called "consideration." So the hospital has to give you some consideration for you to accept the non-compete clause. So you might be getting some of your payment to become an employee based on your acceptance of a non-compete clause. So be wary exactly what that non-compete clause is and negotiate it more to your satisfaction if it's not to your satisfaction in what's usually the boilerplate contract that you're handed by the hospital. Binding arbitration clauses. These are critical issues. For instance, if you have some sort of issue with your hospital employer, you may not have the ability to sue your employer for loss of privileges, loss of contract, and being basically told to leave in 30, 60, 90, 120 days. You may be forced into binding arbitration. In other words, you don't have the ability to mediate it, you don't have the ability to sue for your rights. You are subjected to an arbitrator which could be a judicial body or an extra judicial body that arbitrates your case and it's non disputable after that. It's binding. You then cannot say, I don't like the results of this arbitration. You can then not go to court. You cannot mediate, that's it. So you don't have to sign that binding arbitration clause based on the fact that it's hospital boiler plate. You can say, "I wanna reserve my right, my legal right to either sue or request mediation or nonbinding arbitration. I want my options." So just look at that in your contract, that's something that you do not have to accept. Okay, so moving on. Final point is employment contracts really are ethical documents in my point of view. You should not be signing away your duty to provide care of an ethical nature to your patients. You are not becoming a fiduciary agent of the employer. Number one, you are an employed doctor, you are still a doctor, you're still the neurosurgeon whose making ethical right decisions for the patient. Make sure that the contract does not have anything that would conflict with your ethics in terms of patient care. Read it carefully. Some things that we don't have to deal with that are in this sort of arena, that I'll just point out that for instance, internal medicine doctors, family physicians, OBGYN have to deal with when they sign their contracts. And I'm just bringing this up to push the point is in the realm of abortions, morning after pills, birth control, all those things. So in some hospital systems, it's not accepted to be able to provide any of those services for patients. And a physician who signs a contract for employment and signs away his ability to provide any of those birth control or morning after or abortion services, might think very clearly twice about it if it is an ethical conflict to what they consider best practices for them. And they have to recognize that if they try to do that, once they're an employed physician, they could lose their employment contract because the hospital will have the right to fire them, to terminate them either at-will or with cause or without cause, because it'll be clearly written into the contract that they cannot provide those services to their patients. So be aware. And Aaron, if you can go to the next slide. Summary, when you're thinking about either going into private practice or employment arrangement, or if you're in a private practice and you are ready to start thinking of becoming an employee, think about these four points when you're looking at the possibility. It's not just a financial decision. There's legal, ethical constraints that are important to recognize when you become an employee, besides the issue of some lack of autonomy, independence, freedom, entrepreneurship, the ability to control your own destiny. You need to look at whether or not the employment agreement poses too many conflicts for you. Whether there's too much oversight. Do you have due process? Are you just a cog in the wheel? Are you just another employee number that's being looked at by the hospital administration as a way of creating a profit center and better contribution margin than somebody else, or not having somebody of your specialty or building up your specialty for increased profitability so that they can cost shift and survive in this era where certain services which have to be provided lose money, yet neurosurgery and cardiac surgery, cardiology make money and they wanna build up those service lines. Are you being looked at strictly as dollars and cents? So recognize what you're getting into when you either turn down the opportunity for a private practice, or give up a private practice to move it into an employment situation. Make sure that you look at all the options possibly that are available to you if you're coming out in the private practice world, from a residency or fellowship position. Those private practices with ancillary revenue streams have a better chance of survival going forward than those without. No matter what, the goal is to provide patients the best quality care, access to care, rights to care, unaffected by financial considerations. That includes your own personal financial considerations. So don't get caught up in referring to your own facility that you own, strictly to make money. It's designed to help your practice survive so that you can be independent. Yes, it makes you money, and it may actually provide better quality of care than the local hospital outpatient facility, if you own your own hospital in your own non-hospital outpatient facility. You may have better imaging than a hospital. You may have better than other ancillaries. Make sure you're doing this because it's better for your patient. Maybe you can provide one stop shopping to your patients in a neurosurgery practice better, if you own the entire one-stop shopping scheme, your office, your paying practice, your imaging, your surgery center, your durable medical, et cetera. Maybe it's better care and that's why you should do it. But those are the practices that can survive going forward. The ones that I don't think can survive going forward, if you're looking at a new practice and you should probably not be joining these practices are those that have subscribed to the just let's work harder to cover the lesser reimbursement, the higher overhead scenario. Work harder and, you know, trying to create more revenue stream that way do more cases, do higher acuity cases. That is not the formula you want. If you don't have ancillary revenue streams, I don't think it's a viable thing to remain in most practices that are independent of a hospital employee arrangement. And you should look at an employee arrangement because it'll allow you to provide ethical quality care in most circumstances and have financial security. The risks of control of who makes medical decisions and divided loyalty should never be tolerated if you do become employed. Make sure that you can make autonomous decisions at all times regarding what's best for your patient, and that you will not get terminated for making quality of care decisions under any circumstance. As we end my portion of this discussion in the end, what's absolutely critical regardless of government regulation, regardless of payment schemes, regardless of whether we're independent, solo practitioners, small group, employed doctors, government employees is to protect ethical patient care and the integrity of the medical profession. On that note, I'll end it. And Jim, if you have any comments on any of these points, otherwise, Aaron.

- Well, let me make two or three comments before we turn back over to Aaron. First of all, remember whether you are joining a private practice group, or you're going to practice with a hospital, you're gonna be employed. You're gonna be employed by somebody. So the distinction is really who the employer is. Not whether you are employed or not. And I think it's an important thing to keep in mind that even if you join another person with a two person group, you're employed. You may have a corporation that you are employed by, but you are employed. That's the first thing. The second thing is, I think it's important to understand the concept as you've pointed out so carefully, of ancillary income of being that means by which the income and standard of living that a neurosurgeon expects is maintained. If you are in a private practice, you have to be the entrepreneur that makes those things happen. If you're employed, you're gonna find that those same kinds of substitutions for your professional revenue occur or built into your salary, but they are coming from hospital revenue. It's a substitution of the hospital revenue, either for a call for these other services that you do perform, or even the revenue that you might get from a outpatient center, that's built into whatever is extra beyond your basic professional earnings. And if you're an employee of a hospital, you have to remember that there is something built in there, but it's not unlimited. You can't keep adding and adding and adding new expenses before the hospital says enough. You're not earning your keep. Aaron.

- I mentioned something as someone who has also tried to talk a number of people about these very controversially issues that are not really controversial, but rather very difficult for people who are graduating for residency to deal with. In residents, how to put a pedicle screw in or clip an aneurysm. But these are critical issues that neurosurgeons have to know to deal more than absolutely anything else. The bottom line is, depending where you are looking for practice the circumstances may force you to choose one versus the other. I know rich talks about how his perspective based on this situation he is in and also Jim, you're talking based on the situation you are in. So everyone's situation is different. What is most important to take away from here is when you negotiate your contract, these are the details you have to focus on because you may already know well, based on my circumstance, I have to become hospital employed. You know, many neurosurgeons, especially with the duty hours and lack of that sense of discipline are no longer that motivated to deal with a lot of different things. And even though they have the option between a private practice and hospital employment, they say, "You know what? I just wanna take a shortcut," you know, and say, "I wanna do hospital employment because I have to deal less with." It's different than where Jim is, where, you know, his circumstances may demand that he has to do hospital employment no matter what he chooses. So if there's an option between the two, often people choose the option that is less work to be involved in. And the moment you do that, you have to remember these important factors that you both mentioned. That your contract is the most important thing for you after you started your prac... after you know, your patient care, to be able to make sure that the interest of the patient will ultimately come first and your interest comes second and everything else afterwards.

- Certainly agree with that. And I know I went into practice 32 years ago. I was given a contract and I don't even know that I ever read, but that would be a criminal neglect of yourself right now. But there was enormous trust that's what you did. It's very, very different. You have to do things you've never been trained to do and had no experience in and learn them very very quickly before you have to correct the mistake.

- Well, I wanna thank both of you guys for really a spectacular talk, great pearls, and I'm sure all the young neurosurgeons would tremendously appreciate this. Again, thank you.

- My pleasure, thank you.

- I'm glad to be able to participate, thank you.

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