Medical Group Management Disputes Can Lead to Disruption and Costly Consequences

Mismanagement in a medical group can happen, especially since managers have a fiduciary responsibility to act in the best interests of the group. What amounts to “best interests” may be literally disputable. Typically, disagreements arise over:

  • Entering into a risky or bad deal with outside parties that loses money or prestige for the group.
  • Mismanagement of group practice funds.
  • Firing a colleague that others feel is an asset to the business.
  • Hiring inept or irresponsible employees or associates.
  • Personality conflicts – a management partner may turn out to be a terrible boss who robs the practice of positive energy, inhibits partners from doing good work and possibly endangering patients.

That’s just the start of reasons for disputes that we’ve witnessed at Lubin Austermuehle. For those in group practices, the costs and consequences of bad management are varied and potentially dire. In some instances, the entire practice may be held legally responsible for negligence on the part of those in charge.

Managers Do Have Recourse to the “Business Judgement Rule.”

If questioned or if a suit is brought against a manager, there is recourse to a defense known at the “Business Judgement Rule.” At Lubin Austermuehle, we’ve used this rule successfully on behalf of our clients.

It’s our understanding that, this duty of care requires directors and officers to act in as competent a manner as would reasonably prudent people in their positions. Officers and directors must make decisions that they believe, in good faith, to be in the best interests of their companies and must make decisions after appropriate research and due diligence inquiries. The decisions must be the products of appropriate care and thought.

At LA, the caveat of our litigation law firm, has been and always will be to provide advice and counsel to our clients based on our 20 years of experience, our thorough understanding of the law, and a great deal of “appropriate care and thought.”

Talk to us. Whether you’re a manager in a physician group, or you represent the interests of the group, we should have a frank and FREE discussion regarding your individual situation and needs. Contact us now to talk and see if our belief in results and relationships results in a good fit for you.

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