Are Your Practice Agreements Getting Dusty
Your practice probably hinges on a number of complex agreements – agreements that require periodic review and updating. These documents in particular demand your attention:
- Partnership agreements
- Employment agreements
- Deferred compensation agreements
- Real estate/tenant agreements
- Buy-sell agreements
Watch for Triggers
Partnership and related agreements should be reviewed and updated whenever a new doctor joins or leaves the practice, or whenever the practice materially alters the way it does things. This could include changes in building ownership, the addition of new equipment or service lines, or any substantive changes in practice policies.
Not only do these agreements need to be updated, but they should also be coordinated. Like tumbling dominoes, a change in one agreement can have an effect on the others.
Review and Revise
While you’re reviewing your documents, consider whether adding additional protections makes sense. For example, adding an arbitration clause to an employment agreement may lead to a more amicable parting in the event of trouble – and require far less time and money than litigation.
Keep It Safe
If your practice is incorporated, consider renting a safe deposit box in the corporation's name. Unlike one in your name, a corporate safe deposit box can't be sealed upon your death. Whoever holds authorized access can retrieve important papers without delay.
Which documents belong in the safe deposit box? For starters: deeds, titles and mortgages, employment contracts and other important practice agreements.
Spending some time and money now to update your documents may save you a lot later when you don’t have to hire a lawyer to represent you in a legal battle over a vague or confusing agreement.
Healthcare Practice Strategies - Winter 2017