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Oct 2014

The High Stakes of Good Patient Care

Good hospitals generally try to insure that their patients have the broadest scope of medical services as well as top quality treatment. To help them do this, many offer relocation and other financial assistance packages to highly qualified doctors and specialists they want to have available to their patients.

Let’s say that Hospital X, for example, wants to improve its expertise in cardiology. The hospital decides that the best way to do this is to recruit a highly qualified specialist in cardiology who happens to live in another state. In order to persuade the cardiologist to pull up roots and join its medical staff, the hospital may offer the doctor a “start up” loan package to help cover the costs for relocation and to establish a practice in a new community.

This loan, like any other, would require the doctor to sign a loan agreement with the hospital. The loan payments would likely be made periodically, perhaps monthly, with the cardiologist obligated to repay the loan funds after some time, usually a year or more. The cardiologist is usually required to also maintain a practice within the hospital’s service area for several years. In the event the cardiologist relocates out of the hospital’s service area before the loan is repaid, the doctor would be required to immediately repay any balance to the hospital.

But what happens if the cardiologist does, in fact, move out of the service area before the contractual term expires or before the loan is paid off? The good news is that the hospital can aggressively seek recovery from the cardiologist or any other physician that breaches a financial assistance agreement. But to prevail, the hospital needs to ensure that these types of agreements are outlined with a clear and concise contract that includes a promissory note signed by the physician.

The hospital can achieve this by, first, having expert legal representation in the drafting of these types of contractual documents, preferably with attorneys who understand the intricacies of the health care system. The second is representation by competent and aggressive litigators in the event the hospital needs to sue the doctor for breaches of the agreement, whether due to relocation or nonpayment for some other reason.

By taking a few simple steps to protect themselves, hospitals can feel confident in offering recruitment incentives to the best medical talent that will ultimately benefit consumers – their patients..

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