A physician is leaving the practice; are you prepared?

January 1, 2010

No matter the size of your practice, unless each physician is the same age and plans to retire at the same time, you should consider developing a transition plan for the senior doctors in your practice.

Key Points

It is important to develop a transition plan for your medical practice so that both the practice and the physicians can proactively plan for physician slowdown, part-time arrangements, and retirement. According to practice transition expert Deborah Walker Keegan, PhD, you need to have a transition plan in place to avoid creating a situation in which a succeeding physician expects to have the same arrangements and conditions with which the outgoing physician worked.

Reasons for a transition

Why do physicians want to make a transition? Dr. Keegan says there are many reasons: generational issues related to what is appropriate work time versus personal time, a desire for a better work/life balance, outside interests physicians may want to pursue, life events that naturally occur, or the inability to keep up a certain pace.

In situations like these, physicians will seek to make a change in the way they practice. Transition options include reduction of work hours to a part-time status, a reduction in weekend or weeknight call, increased vacation, and limitations to the type of services provided or patients that are seen. For example, a urologist might seek to work office urology only and not perform procedures, or a urologist who specializes in urologic oncology may seek to only treat patients presenting with a cancer diagnosis, rather than the full complement of urologic diagnoses.

Transition: Right or privilege?

Dr. Keegan advises that when creating a transition plan for your practice, be sure to determine whether your physicians view transition as a right or a privilege. When transition is considered a right, each physician is permitted to independently define his/her own work schedule. When transition is considered a privilege, each physician must earn the authority to change his/her work schedules, hours, and work levels.

Given the difficulty of ensuring appropriate on-call coverage, patient access, continuity of care, meeting payer obligations, and other similar requirements of a medical practice, many have recognized that physician transition cannot be an absolute right. Instead, it is typically viewed as a right with limits or as a privilege that is earned.

It is important for the transition plan to spell out details. One example is requiring advance notification when a physician seeks to make a change in work schedule. Other elements that should be clearly delineated are eligibility requirements for transition requests, the specific impact of the transition on the physicians' compensation, changes that relate to the voting rights of the physician, the impact on ancillary revenue distribution, time limits for transition status, and fail-safe measures to ensure that the practice can continue to cover its many service and contractual obligations.

Notification is of particular importance. The notification timeline typically depends on the reasons for the transition. For example, for physician slowdown due to retirement, Dr. Keegan suggests a 2- to 3-year notification. In these instances, she also recommends an end date, at which time the physician retires from the practice (or becomes an employee of the practice). This permits the practice to proactively plan for new physician hires.

For transition from full-time to part-time status, Dr. Keegan suggests a 1-year notification that will be accompanied by changes to compensation levels, patient access requirements, partnership status, and voting rights. Of course, for transition due to illness, family emergency, or other situation, the time frame will be shorter; however, the transition may also be temporary in these instances, with an end date defined.

Bottom line: A physician transition, be it reduced hours or retirement, needs to be carefully thought out and planned, with consideration of multiple viewpoints and factors included in the practice's strategy. With sound planning, a urology practice can and should experience a smooth, seamless transition.

ModernMedicine NETWORK

EDUCATION

Practice management consultant Keith Borglum, CHBC, outlines tips for buying and selling a practice. See:
http://www.urologytimes.com/buysell

Learn how to bill for a locum tenens physician during a transition period. Read:
http://www.urologytimes.com/transition

Dr. Baum is a urologist in private practice in New Orleans. He is the author of Marketing Your Clinical Practice-Ethically, Effectively, and Economically.

Dr. Dowling is medical director of Urology Associates of North Texas, a 48-physician, community-based, single-specialty group in the Dallas-Fort Worth metroplex.