Some of the partnership considerations a healthcare attorney must analyze include:
1. Underlying economics of the practice, its assets, liabilities, risks and prospects.
2. Financial structure of the practice, ownership rights, and governance documents, as well as, all documents, agreements, and contracts relating to the practice, including payor agreements, hospital agreements, property leases and subleases, equipment leases, management, employment, and other service agreements.
3. The representations and warranties contained in the Purchase & Sale and/or Buy-Out Agreement and their implications.
4. Compensation, buy-ins, buy-outs, restrictive covenants, and exit strategies including agreements regarding compensation upon dissolution of the partnership and/or death of a partner. Note that if the practice compensates owners based on their respective production, a healthcare attorney must review the initial structuring and ongoing execution of the arrangement to ensure it complies with the Stark Law, the Anti-Kickback Statute, applicable state laws, Medicare reimbursement regulations, and the Internal Revenue Service’s (IRS) unreasonable compensation regulations.
Before committing to becoming an owner of a practice, prospective partners should have their healthcare attorney extensively review the agreements and issues involved in joining a practice to ensure a financially successful and generally rewarding partnership
If you have any questions or would like a consultation regarding this or any other healthcare legal issues please do not hesitate to call one of our experienced healthcare attorneys at 212.668.0200 or email us at [email protected] Our healthcare partners have years of experience representing physicians in numerous transactions including practice buy-ins and buy-outs, partnership formations and dissolutions, practice mergers and acquisitions as well various types of contracting among healthcare providers. The attorneys at MDRXLAW are here to provide guidance and counsel on any of your healthcare legal matters.