ADVISORY e-ALERT      February 28, 2012
Advisory Law Group, a Professional Corporation  




As more hospitals seek to cut back stipends paid to physicians and to obtain more services for less from contracting groups, they are increasingly turning to the request for proposal, or RFP, process. 
From a the standpoint of making a rational contracting decision, RFPs are a poor substitute for the intelligent selection of the best relationship with a physician group. Despite all efforts of hospitals to treat physician services as a commodity, and, quite frankly, despite many physicians' belief that they are providing a commodity service, medical services are not a commodity. Applying a commodity purchasing tool to them is counterproductive, even solely from a hospital's perspective:  "saving" several hundred thousand dollars on, for example, a hospital-based group's stipend, at the cost of destroying the hospital's economic engine when the new group cannot perform, is not saving several hundred thousand dollars at all; rather, it is wasting millions. 
Nonetheless, more facilities are using the device to force physician groups to cut their own positions or even their throats. 
Even more troubling is the burgeoning trend of completely fraudulent RFPs in which the hospital makes a back room deal with a favored competitor or provides the favored competitor with information gleaned from the other participants, all the while pretending as if the selection process is impartial. 
Of course, this propensity toward fraud is not limited to the healthcare setting. Recent litigation includes a dispute over an RFP for large scale copier services in which it is alleged that the entity issuing the RFP provided special information to the winning competitor and entered into a contract that varied significantly from the terms of the RFP, and a dispute over a transportation related RFP in which it's alleged that the entity that issued the RFP placed little weight on objective criteria and made the decision chiefly on subjective factors. 
Fraud in connection with an RFP is simply another reason why you need to be careful about making the decision about whether or not to participate.   If you do decide to participate, you need to understand how to conduct yourself to best guarantee fair consideration through the process, and, optimally, how to achieve victory on economic and other business terms that make sense for your group.


The Promise-Delivery Gap 


View Episode 38 of the Wisdom. Applied Videocast 




Have you ever had a hole in your pocket, so that when you're walking down the street, a few quarters bust through and roll onto the sidewalk?
But what if instead of quarters, it's dollars? And what if instead of dollars, it's hundred dollar bills or thousands or tens of thousands? Metaphorically speaking, of course.
Chances are, your practice has lots of pockets and some of those pockets have holes in them.
For example, the surgical practice that can't schedule elective surgery at the time the patient leaves the office, only to have the staff neglect to contact the patient for weeks. Has the patient lost faith in the surgeon? Has the patient complained to his family practice doctor who made the referral and who now, in the patient's eyes, might look like an idiot?
Or take the radiology group that doesn't promptly respond to a referring physician's request for an additional consult - has support in connection with the next renewal of the group's exclusive contract slipped through the group's pocket?
If you had money raining down your legs every time you walked down the street you'd either get the pocket stitched up or you'd buy new pants.  So why not take your practice to the tailor, too.



The Super Bowl of Radiology Success, published on on February 22, 2012.

Commodity Practice or Experience Monopoly?, published in the Radiology Business Journal on February 19, 2012.

Shadow Your Competition, published on on February 17, 2012.

Strategies For Exclusive Contracting, published on on January 30, 2012.

To read other recent articles, click here

Mark was quoted on on February 9, 2012, concerning the Pennsylvania Supreme Court's opening the way for plaintiffs to sue physicians for emotional distress damages even in the absence of physical damage from alleged malpractice. Click here to read article.

And, quoted Mark on February 15, 2012, on the impact of CMS's newly instituted issuance of Comparative Billing Reports on Advanced Diagnostic Imaging. Click here to read article.   


Want to read past issues?

Did you delete (by mistake, of course!) a past issue of Advisory e-Alert and want another copy?
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The materials presented in this Advisory e-Alert are educational only and are neither legal advice nor a substitute for it. Advisory e-Alert presents a general discussion which may or may not apply to your particular legal or factual circumstances. The distribution of Advisory e-Alert is not intended to create, nor does it create, an attorney-client relationship. Please do not send us confidential information without receiving explicit authorization from Advisory Law Group to do so. Do not take or avoid taking any action as a result of the materials presented in this e-Alert without first obtaining legal counsel.   
2012 Advisory Law Group, All Rights Reserved


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 How To Deal With RFPs For Physician Services


More and more hospitals are disrupting their relationships with physicians.

As to hospital-based groups, they seek to cut stipends and get more for nothing.  The favored tool?  The request for proposal, commonly known as an "RFP."

And as a shock to many office-based physicians who for decades thought they were immune, hospitals' moves to "align" physicians include deciding who gets to participate, and who is out.  Among the tools: The RFP for office-based specialty services.   

How can an RFP be avoided? Do you respond? How do you respond? How can the rules be bent?

These are among the in-depth issues that we'll discuss in the upcoming webinar, How to Deal With RFPs For Physician Services.  You'll receive practical and actionable information for your group's immediate application.

The investment is $597, not even the change your group would leave behind on the couch if it could sit down. And if you apply any of the information you'll come away with, the webinar will turn out to be free.  If the investment is an issue, that's the reason why you need to attend this webinar.  

When:  March 1, 2012
Time:    4:00 p.m. PST
Length: Approx. 1hr
Investment: $597 


When:  March 3, 2012
Time:    10:00 a.m. PST
Length: Approx. 1hr
Investment: $597




Click here to register today!

Because you want to be better informed than your colleagues, you're invited to connect with us on Find us on Facebook Follow us on Twitter View our profile on LinkedIn Visit our blog View our videos on YouTube to receive advance notice of my newest releases of complimentary information.


Let Us Know What Business/Legal Issues You'd Like to See Addressed in A Future Issue
Warning Sign
In This Issue
RFP Fraud
Videocast: The Promise-Delivery Gap
All Things Personal
Recently Published Articles
The e-Alert Archive
Podcast Now On iTunes
2012 Anesthesia Business Update is Coming Soon
The Wisdom. Applied. Blog
Q & A Video Series
The Immediate Leader Experience
Mentor Program


Listen and subscribe to Mark's podcast series, Wisdom. Applied., now on iTunes.

2012 ABU
Follow this link to Mark's blog, Wisdom. Applied.


Overhear Mark's responses to medical group strategy and business questions.
Follow this link to the
Q & A video page.    


You're a physician who wants to form a medical group and, among other things, subcontract with or employ other physicians, enter into exclusive contacts, obtain significant stipend support money, create related entities to increase protection and the like. And you want to come up to speed on all of this immediately.

Or, you're the new leader of an existing group with complex practice and business operations -- you need to understand how to master the group's organizational, operational and leadership issues -- and you need to be brought up to speed immediately.


After having regularly dealt for many years with physicians in both of these contexts, we've designed a process to deliver immediate results: The Immediate Leader Experience™.


The Immediate Leader Experience™ takes place over a weekend in Santa Barbara, California and includes two nights accommodation at the Four Seasons Santa Barbara Biltmore Hotel. 


In two short days, you'll be entirely up to speed, totally prepared and confident.  You'll be armed with tools and sample documents.


Due to the nature of this program, admission is upon interview only -- there is extremely limited availability.


For further information on The Immediate Leader Experience™ follow this link.   
For information on Mark's mentor program, click on the following link:  The Advisor Program.