fix this practice
Look Before You Leap
The success of your relationship depends on how you define it.
S. KATTOUF, O.D., D.O.S.
Q: I joined an independent
practice as an associate five years ago. The senior (owner) doctor promised me
the ability to buy-in after two years. He has been dancing around the issue for
the past three years. Any advice?
Dr. T. Shurtz Via
No one likes a "Monday morning quarterback." From your question it appears
that you had no "associate contract." This is a common error that adversely
affects both associate and owner. Optometrists must understand that verbal or
handshake agreements leave a tremendous amount of gray area in their
professional marriage. A professional consultant should negotiate the associate
agreement to assure that both parties are represented in a manner that results
in a fully-defined set of points that leave nothing to chance. In my years as an
optometric consultant, it never ceases to amaze me how many O.D. owners and new
associates join forces with nothing in writing. This can be dangerous and
expensive to both doctors.
at its worst
Dr. Harvey, an owner O.D., called
my office and informed me that his associate of six years left his practice and
opened a competing office less than one-half mile from his. My first question
was, "Do you have a written associate agreement and had you verbally agreed to a
'buy-in?'" Dr. Harvey told his associate at the commencement of their
relationship that if there was good chemistry between them, the associate would
start the buy-in process. Call it procrastination, the ostrich syndrome or just
naivete, there is no excuse for this lack of planning. Prior to retaining me as
his consultant, Dr. Harvey sued his former associate. The associate was
marketing to patients from Dr. Harvey's practice and had the entire practice
database on computer disc. But, with no written contract, there are no teeth in
the lawsuit. This could all have been prevented. Now, Dr. Harvey and his former
associate have the stress of a lawsuit along with huge legal fees. I intervened
and was able to get the former associate to cease direct marketing of the
patient base. The problem is that Dr. Harvey now has a competitor who should
have been his partner.
Play it safe
Let's go over what to include in
such a contract. In order to protect both owner and associate, the agreement
� A restrictive
covenant. This prevents associates from opening a competing office and includes
the area radius in miles (accepted by the county court) and number of years
(usually three). A financial penalty is common if the doctor breaks this portion
of the agreement, usually in the form a large monthly payment for a defined
number of years.
� A buy-in clause.
This defines the time at which the associate can begin the buy-in process.
Having the practice appraised prior to the association is a negotiable point.
All in the planning
As I travel around the country, I
observe that doctors have more than adequate clinical skills. These same doctors
lack plans and controls in the business. Bringing an associate into your
practice can be one of the best or worst experiences of your career. Do not be
casual in your approach.
DR. KATTOUF IS
PRESIDENT AND FOUNDER OF TWO MANAGEMENT AND CONSULTING COMPANIES. FOR
INFORMATION, CALL (800) 745-EYES OR E-MAIL HIM AT
THE INFORMATION IN THIS COLUMN IS BASED ON ACTUAL CONSULTING FILES.
Optometric Management, Issue: August 2006