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Re: Buying in to practices. (excessively long emotional response)From: Kleinman, Dr. Gary E. (pg1kle@bpthosp.org)Thu Jun 29 08:44:22 2000
>----- Original Message ----- From: "Braun, R. Daniel" <rbraun@iupui.edu> To: "Multiple recipients of list OB-GYN-L" <ob-gyn-l@mail.medispecialty.com> Sent: Thursday, June 29, 2000 8:05 AM Subject: Re: Buying in to practices. (excessively long emotional response)
>This was after the school recruited them, and moved them half Thank you for helping to keep this thread alive until we can outlaw restrictive covenants in the medical profession. This is not an example where a restrictive covenant is necessary to prevent serious economic damage to a business. The teaching practice is primarily an educational business. The specialists going across town probably did nothing to hamper the educational ability of the medical school. In fact, they probably still take patients there and teach residents, nurses and students. If they moved, the school and community would lose this educational benefit. As per the recruiting and relocation costs, no matter where they moved (1 flight up in the same building or to Siberia), the recruiting costs of replacing the specialists would still be there. If you want to keep recruiting costs down, don't use albatrosses such as a noncompete clause to restrain hired physicians. If the recruitment process is too expensive, a longevity bonus might help. For example: stay for 3 years and we cover tail insurance. Or: If you go into competition in the area served, you agree to liquidated damages equal to the cost of recruiting and relocation. Maybe the revenue of the school did suffer a bit. But the school is bigger than the individual and usually better able to weather a temporary loss. Often, a large portion of the patients of a medical school are indigent or state-funded patients. The schools usually have ready sources of referrals for these patients so that a new specialist would have no trouble reestablishing the academic practice even if the departing specialist took some patients. If (unreasonable )competition for patients did hurt the school, I doubt that it would be of sufficient magnitude to require the use of a contract clause which the AMA has called unethical, the legal profession has outlawed among its own and can be damaging to the practitioner, family, and possibly the community. Besides, if the school tried to be competitive, they would reap long term economic benefits benefits. Thank you for your interesting response. Gary Kleinman Come to think of it, Michael Johnson, the Olympic sprinter extraordinaire, could have won every race he ran if he limited his racing competition to owners of medical practices. I think he would have every right to do so.
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