What to do when you end your PPMC contract
Legal issues are just the tip of the iceberg
There’s more to disengaging from a physician practice management company (PPMC) than just terminating your contract. When you regain your independence, you have to start all over and set up a new practice.
"The whole unwind is much more than just a legal transaction. Many physicians think they just have to contact an attorney to get out of the contract. In reality, when you deconstruct a practice and reconstruct another practice, it becomes an operational issue," explains Bob Healy, president of Physicians Strategic Resources, an Atlanta company that helps physicians disengage from PPMC arrangements.
In addition to getting out of your contract, here are some things you may need to do if your practice withdraws from a PPMC:
• Recruit a new management team. The existing team may opt to stay with the PPMC.
• Restore the central business office.
• Purchase and set up a new information system. Both the operational and financial systems are owned by the PPMC.
• Renegotiate all of your managed care and vendor contracts.
• Secure operating capital, because, in most cases, the PPMC will retain your accounts receivable.
• Secure capital to repurchase your assets — everything from your desk to the medical equipment.
• Negotiate with the PPMC on the purchase price of the assets.
• Set up new committees to run the practice. Healy suggests a governance committee, an operations committee, a marketing committee, and a human resources committee to deal with compensation and benefits.
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