Hiring a Healthcare Lawyer: Here's What You Need to Know
Because healthcare is such a hot industry, the concept of a “healthcare” lawyer has gotten a lot of traction in recent years.
But what exactly is a healthcare lawyer and is that even important?The answers are simple, sorta. A healthcare lawyer is one with lots of years of experience learning pertinent healthcare laws (e.g. the Stark Law, the Anti-Kickback Statute) and then applying them every day to specific healthcare clients. Board certification is a pretty key indicator, but the concept of board certification in healthcare law exists only in Florida. And even then, board certification alone will not tell you (1) the level of a lawyer's expertise in a particular issue or matter, (2) the lawyer's willingness and ability to know what he/she doesn't know, (3) whether the lawyer is solution oriented or merely an issue spotter who offers little of value beyond that, or (4) whether the chemistry between lawyer and client works well.
How necessary is it that the lawyer be a healthcare lawyer? If you're a client in the healthcare inIf you're in the real estate end of things, you have to know about the space lease safe harbor to the Anti Kickback Statute (AKS), and you have to know (a) what the governmental agencies (the OIG, for instance) has had to say about particular space lease arrangements, and (b) what sort of enforcement there has been on that issue.
If you're a marketer for a DME company or a toxicology lab or a pharmacy (or whatever else in the healthcare space), you must be informed of and represented by a lawyer who understands the ins and outs of the bona fide employee exception to the AKS and also the personal services and management contract safe harbor to the AKS. This doesn't just mean a lawyer who can "look it up," but also a lawyer with deep experience interpreting OIG Advisory Opinions, seeing how enforcement (and even investigative) activities may bear on any given proposed arrangement or compensation proposal.
If you're a medical practice and you want to structure compensation or a buy in or know how to allocate profits associated with diagnostic imaging or physical therapy, you must be advised about the Stark in office ancillary services arrangement exception, OIG interpretations about that, how Florida and federal courts apply healthcare laws to those matters.
If you're buying or selling any healthcare business, you will need to know about the application of Florida's healthcare clinic licensure law, since it will either delay the transaction or force it into a "management bridge" arrangement until licensure is awarded. You'll also need to consider things like--
oHow key managed care agreements are to the purchaser and the issue of assignability;
oWhether it makes sense for the Medicare provider number to be assigned to the buyer or not;
oThe risks of the purchase that cannot be "contracted away" by federal law.
Making a poor choice of legal counsel is a real issue. Consider these real life screw ups:Situation A. Addiction treatment provider came to us after having been informed by an inexperienced lawyer that it is illegal for the provider to have any compensation arrangement with a sober home (that was actually providing important services). We explained applicable healthcare law, discussed options and assessed risks so the client could make a business decision on the spot.
Situation B. DME client came to us and assumed his marketing contracts and services agreement with one of his suppliers was compliant because he bought the business and assumed everything was ok. His lawyer was not a healthcare lawyer and so did not inquire re federal/state compliance with respect to anything.
Situation C. Client came to us to buy more diagnostic imaging centers. Another lawyer had helped the client grow by acquiring some, but now wanted our help to buy several more. We quickly determined that key state licensure requirements were never met, and his entire business structure was built on a platform that required a license (and which could be shut down at any moment). He had no idea.
Situation D. Client was a chiropractor with a chiropractic practice. He formed a second company and hired an MD for work for that second company. Referrals were made back and forth between the two companies. His first lawyer never advised him about the issues involved in the Florida Patient Self Referral Act of 1992 or the Stark Law, so we had to restructure his business.
Situation E. Client owns a toxicology lab and has a standing orders protocol that made sense to their corporate lawyer, but which flew in the face of medical necessity documentation requirements and which seriously jeopardized their financial viability. We went in and formulated extensive policies, procedures and compliance plans to ensure not only legal compliance, but great risk management vis a vis managed care payers.
Situation F. Client had a vascular access center (VAC). Their corporate lawyer advised that it ought to be part of the practice (the same tax ID entity). When a buyer went to purchase the VAC, the client was adversely affected tax-wise, since they could not just sell the VAC entity (since it was intertwined with the medical practice). The corporate lawyer never considered contacting a healthcare lawyer to discuss structural options and the impact of laws like the Stark Law and AKS.
Situation G. Client came to us with a W-2 employment marketing agreement prepared by a corporate lawyer where compensation was set as a percentage of collections for healthcare items. The client was never informed re the nuances of marketing relationships, the presence and impact of the AKS bona fide employee exception, the applicable safe harbor and the position of local law enforcement in that industry. They had absolutely no idea about the laws, the risks and their choices!
Situation H. One client's operating agreement was prepared by their corporate lawyer, but it didn't contain a provision that addressed what to do if an owner who violated applicable healthcare law and jeopardized the entire business. it ended up costing the client a lot of money to buy the owner out (at fai
How can you spot an inexperienced healthcare lawyer?? There are normally two signs: first, they just say "no" to what you're proposing (to them everything is a "kickback" or patient brokering violation) and are unable to discuss what might work or why. Second, they are unable to communicate any healthcare law you may be aware of in a way that makes any sense. This part is a little tricky though. Einstein was quoted as saying "If you can't explain it simply, you don't understand it well enough." But he is also credited with saying "Make everything as simple as possible, but not simpler."
So then how do you recognize a qualified healthcare lawyer and what should you expect from him/her?1. The lawyer should have plenty of experience representing healthcare clients in the same situation you are in. This means many years helping clients just like you! And it means he or she doesn't have 20% of their clients as healthcare providers.
2. The lawyer should be able to discuss the pertinent healthcare laws at your initial meeting, and not have to research them to communicate how they may apply. That doesn't mean research might not be required. Wise clients get legal advice in writing; and wise lawyers confirm "gut level" advice and always offer it as a best practice.
3. The lawyer ought to insist on ensuring you are educated about the laws and risks associated with your issue. It is not helpful or wise, for instance, for a lawyer to give you a contract without being sure you understanding the laws, the risks and how to use it properly. Contrary to what some clients think, lawyer do not just "push print."
4. Ask other clients of the lawyer!
The process of providing legal advice is particular and precise.And it can be annoying to clients and expensive. It always involves (1) education about the applicable laws, (2) discussion about the options, and (3) consideration of the risks associated with each such option. And those risks have to include not only what the laws state and how they're interpreted, but also what works and what's trending in your "space" and where you work--e.g., governmental investigations and payer actions. Clients ought to expect nothing less.
Communication and clarity is generally the cure when it comes to establishing any professional relationship. When engaging any lawyer, ask:
1. What experience do you have doing the particular thing I need done?
2. Who will be working on my project? You are hiring an expert and often don't need a team of people to deal with your matter. In larger transactions, you may need a team of experts, but many matters do not require that.
3. What will it cost me to get what I came here for? For many matters (review or preparation of a contract draft), the lawyer can tell you. And in such cases, a flat fee may make sense. That can be a great way to remove any distrust and fear re the fees.
4. When will I get it?
The best professional relationship is the one that is most compatible. If the lawyer you're speaking with isn't the right fit, ask for a recommendation to one who might be. Take time to find the right lawyer for you and for your situation. The practice of law, medicine and everything else is super specialized. Take your time to get it right. Measure twice; cut once!