Weiss Zarett & the PAP (Physician Advocacy Program)

Weiss Zarett will continue to offer the PAP (Physician Advocacy Program) for 2023 and we will be providing the same services. The 3 programs offered by the 2023 PAP are as follows:

Premium Program

  • $999 per year 
  • Legal representation in connection with a matter before the OPMC, OPD, OMIG, MAC, OIG, QIO, OSHA or OCR.  
  • Providers WITH administrative coverage from their insurance company will receive legal representation pursuant to the PAP without additional cost until the later of the following: (1) the limits of the administrative coverage under their insurance policy are reached; or (2) through the initial interview/appearance before the applicable governmental authority.
  • Providers WITHOUT administrative coverage from their insurance company receive legal representation without additional cost through the initial interview/appearance before the applicable governmental authority.
  • Legal representation pursuant to the PAP does not include subsequent services during any hearing process following the initial interview/appearance. 
  • FREE review of your medical records by a certified coder and a conference call to discuss.
  • FREE 30-minute consultation on ANY legal matter within the scope of practice of Weiss Zarett.    

Comprehensive Program

  • $699 per year 
  • Legal representation in connection with a matter before the OPMC, OPD, QIO, OIG, OSHA or OCR. 
  • Providers WITH coverage from their insurance company will receive legal representation pursuant to the PAP without additional cost until the later of the following: (1) the limits of the administrative coverage under their insurance policy are reached; or (2) through the initial interview/appearance before the applicable governmental authority.
  • Providers WITHOUT administrative coverage from their insurance company receive legal representation without additional cost through the initial interview/appearance before the applicable governmental authority.  Legal representation pursuant to the PAP does not include subsequent services during any hearing process following the initial interview/appearance.  
  • *Please note that the Comprehensive Program does NOT include a review of your medical records, a conference call between you and the coder and no 30-minute call. 

Basic Program

  • $399 per year 
  • Legal representation in connection with a matter before the OPMC or the OPD.
  • Providers WITH administrative coverage from their insurance company will receive legal representation pursuant to the PAP without additional cost until the later of the following: (1) the limits of the administrative coverage under their insurance policy are reached; or (2) through the initial interview/appearance before the applicable governmental authority.  
  • Providers WITHOUT administrative coverage from their insurance company receive legal representation without additional cost through the initial interview/appearance before the applicable governmental authority.  Legal representation pursuant to the PAP does not include subsequent services during any hearing process following the initial interview/appearance.  
  • *Please note that the Basic Program does NOT include a free review of your medical records by a certified coder and a conference call to discuss the findings related to your documentation and coding or representation in connection with matters before QIO, OIG, OSHA, OCR, MAC or OMIG, or the annual 30-minute consultation. 

If you are interested in enrolling in the 2023 PAP or have any questions, please contact Mathew Levy, Esq. at 516-926-3320 or MLevy@weisszarett.com.

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Key Considerations When Selling Your Health Care Practice to a Private Equity Firm

By Mauro Viskovic, Esq.
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Private equity investments in health care continue to trend rapidly upward. $151 billion of private equity capital surged into healthcare globally the past year, more than double the prior year, and more than seven times the volume of investment ten years ago.  In light of these developments, health care practices planning to sell to a private equity firm need to understand the important considerations in advance to ensure that the terms of the sale transaction are appropriate, legally compliant and in the best interest of the practice owners.

Below are 5 key issues practice owners should focus on when negotiating a private equity sale

1. Practice Value and Purchase Price:  

In order to maximize the purchase price from the sale of a healthcare practice, practice owners must learn and understand how private equity firms are valuing their business.  The price is usually determined using multiple of the practice’s earnings but the private equity’s incentive to invest in the practice is primarily based on the practice’s future revenue prospects, contracts, and potential intellectual property or proprietary processes.

Upon determining the amount of the purchase price, the next step is agreeing on how the purchase price will be paid.  Practice owners should seek to have all or a vast majority of the purchase price to be paid in cash.  Most deal, however, include equity in a buyer-affiliated company as part of the purchase price.  A transaction with an equity component will require a due diligence review of the entity that is issuing the equity.  Practice owners should also negotiate for full and immediate vesting of the equity with limited forfeiture provisions in only extreme circumstances.  

Some transactions will provide that a portion of the purchase price will be delayed after closing, for a period of 3-5 years.  If the buyer entity providing the promissory note for this debt component of the transaction is a mere shell entity with no assets, then practice owners should seek some form of security, such as a guarantee from the private equity firm or an affiliate of the private equity firm that has substantial assets and revenue prospects.  

2. Transaction Structure and Compliance with Health Care Laws:

More so than most other industries, health care is subject to a myriad of regulations which requires that the practice owner and private equity firm agree on a structure that is both mutually beneficial and compliant with all applicable laws.  In the State of New York, a primary regulatory consideration to be considered when determining how to structure a physician practice acquisition is the prohibition against the “corporate practice of medicine”. The overall purpose of this prohibition is to prevent non-physicians from interfering with a physician’s medical judgment. Accordingly, the rule prohibits non-physician owned business entities, from owning a medical practice.

To comply with laws against the corporate practice of medicine, private equity firms often use a management or administrative services organization, commonly referred to as an “MSO.” An MSO is paid a fee for providing non-professional services to a medical practice, but does not interfere or otherwise exert control over the professional aspects of the health care practice. Please see our firm’s past article on this subject, “Understanding Private Equity Transactions In Healthcare”, for a fuller explanation of the role of MSOs in health care transactions with private equity firms.    

3. Control of the Practice:

With respect to the control of the practice after closing, the private equity firm focuses on the business side of medicine and leaves the clinical decisions to the doctors. It is not unusual, however, for private equity firms to seek physician representation  among the directors and officers of the practice entity.  As such, practice owners should be prepared to negotiate strong protections with respect to all clinical decision-making authority.  This can include negotiating a requirement that existing management will stay in place and have representation with respect to the management of the MSO that will be assuming the administrative operations of the practice post sale.  Note, however, that even in situations where pre-sale management is retained, the private-equity firm may demand rights to allow it to take control of the practice if it is performing poorly. Several scenarios can trigger such action, including breaches of financial covenants in financing arrangements, failure to meet specified financial thresholds, material breaches of the MSO agreement, and more. Practice owners must carefully examine these clauses to ensure their interests are maintained

4. Post-Transaction Compensation:

In many private equity acquisitions of health care practices, there is a substantial compensation reduction for the physician-owners selling the practice. The private equity firm typically compares the median compensation for physicians in that region with what the physicians in the targeted practice are making.  As such, the practice owner and their accountant must analyze all deal metrics relative to their current compensation to make sure the deal works for them in the long term.

5. Non-Compete Agreements

As an MSO cannot perform professional health care services, the private equity investor is reliant on the continued services of the physician selling the practice following the closing of the sale. As such, private equity firms require some form of a non-competition provision setting forth the duration and geographic scope of the restriction, to prevent the seller from taking the money, quitting, and opening up a shop across the street soon after.  In negotiating such restrictions, the practice owner’s interest is to ensure that the restrictions are as limited in time and scope as possible and are no more than reasonably necessary to protect the private equity purchaser’s investment.  Note that, with respect to enforceability, courts are more amenable to longer restrictive time periods and broader geographic areas in connection with the sale of a business than it might otherwise allow in employment arrangements.

With so much to consider, navigating the complexities of a private equity transaction calls for the care and attention that a highly-skilled and experienced team of attorneys can provide.  If you are a healthcare provider considering whether to sell your practice to a private equity firm, please contact Mauro Viskovic at 516-751-6537 or mviskovic@weisszarett.com.

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Mandatory Healthcare Worker Bonus Program

By Mathew J. Levy, Esq.
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To attract talented people into the medical profession at a time of such significant strain and while also retaining those who have been working so tirelessly these past two years, NYS has implemented the Healthcare Worker Bonus Program (HWB). The HWB was implemented to recognize the efforts of our health care and mental hygiene workforce and reward them financially for their service. To do so, as part of the Fiscal Year 2023 New York State Executive Budget legislation, is providing $1.2 billion in funding for the payment of bonuses for certain frontline healthcare workers.

Most practices are not aware that this is a 
mandatory program. The first deadline has been extended to match the second Vesting Period submission window starting on October 1st, 2022.

Note: Qualified employers who fail to identify, claim, and/or pay bonuses for more than 10 percent of eligible workers may be subject to penalties of up to $1,000 per violation.

We anticipate there will be OMIG Audits for those that are not compliant within the next 6 years. If you should have any questions regarding the NYS Healthcare Worker Bonus Program please do not hesitate to ask.

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Time to Welcome Elizabeth A. Rizzo, Esq.!

By Elizabeth A. Rizzo, Esq.
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Elizabeth Rizzo is pleased to announce that she has joined Weiss Zarett Brofman Sonnenklar & Levy, P.C. with 3 years of client relations and healthcare law experience. Elizabeth earned her bachelor’s degree from Adelphi University and her law degree from Maurice A. Deane School of Law at Hofstra University. 

Elizabeth is proud to be part of the Weiss Zarett team, as Elizabeth carries with her Weiss Zarett’s attention to detail with a strong emphasis on clear and focused communication with clients.

Weiss Zarett is a prominent and well-respected Long Island-based Firm known for assisting members of the healthcare industry and general business clients.  In the healthcare field, Weiss Zarett represents physicians and physician groups, other healthcare providers and health-related businesses with a wide array of legal services including corporate and transactional matters, civil and administrative litigation, healthcare regulatory issues, governmental and commercial payor audits, bankruptcy, and commercial real-estate transactions.  Weiss Zarett brings decades of experience to this complex and ever-changing area of practice. 

Equally experienced outside of the healthcare industry, Weiss Zarett advises and represents businesses and business owners in corporate and commercial matters, business disputes, employment practice, commercial, bankruptcy and commercial real estate and commercial landlord and tenant litigation, creditor’s rights, financing, documenting secured transactions and all phases of commercial real-estate transactions. 

Looking to the future, Elizabeth is excited to build and further develop valuable relationships at Weiss Zarett with her abilities and services now available to be called up at the Firm. Please feel free to call upon us for your legal needs.

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Welcome, Lisa Giunta-Popeil, Esq.!

By Lisa Giunta-Popeil
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Lisa Giunta-Popeil, Esq. is pleased to announce that she has joined Weiss Zarett Brofman Sonnenklar & Levy, P.C.  Lisa brings with her over ten years of general and commercial litigation experience in both federal and state courts in New York, including a clerkship for a U.S. District Court judge in the Eastern District of New York.  She has expertise in handling a wide range of matters, including contract disputes, shareholder disputes, commercial arbitrations, business tort actions, creditor’s rights litigation and securities fraud litigation.

Lisa shares Weiss Zarett’s commitment to providing a thoughtful and comprehensive approach to litigation.  This includes open and candid communication with clients, exploring all potential avenues for the resolution of disputes and considering all possible legal claims and defenses.  The Weiss Zarett litigation team will zealously advocate on behalf of their clients, whether in the courtroom or at the negotiation table.

Weiss Zarett is a prominent and well-respected Long Island-based firm known for assisting members of the healthcare industry and general business clients.  In the healthcare field, Weiss Zarett represents physicians and physician groups, other healthcare providers and health-related businesses with a wide array of legal services including corporate and transactional matters, civil and administrative litigation, healthcare regulatory issues, governmental and commercial payor audits, bankruptcy, and commercial real-estate transactions.  Weiss Zarett brings decades of experience to this complex and ever-changing area of practice. 

Equally experienced outside of the healthcare industry, Weiss Zarett advises and represents businesses and business owners in corporate and commercial matters, business disputes, employment practice, commercial, bankruptcy and commercial real estate and commercial landlord and tenant litigation, creditor’s rights, financing, documenting secured transactions and all phases of commercial real-estate transactions.

Lisa is excited to be joining Weiss Zarett and looks forward to providing you with a broad array of litigation services.  Please call us to see how we can help you with your legal needs. 

ATTORNEY ADVERTISING: PRIOR RESULTS DO NOT GUARANTEE FUTURE OUTCOMES.