May 14, 2021

MEDICO-LEGAL IMPLICATIONS OF CLOSURE OF PRACTICE/ NURSING HOME

By Dr. Lalit Kapoor©

In recent times, a large number of colleagues have expressed intent to close down their practice or even their nursing homes. This has generated several concerns in their minds many of which are real and need to be crystallized and addressed. It is, therefore, appropriate to analyze and discuss some of the issues that may crop up in the process and to outline the safeguards one needs to observe so as to ensure trouble-free departure from practice!

📌Want to retire

📌Going abroad or moving practice to another city

📌Declining practice / financial non-viability

📌Incapacitated due to major illness/disability

📌Victim of debilitating malpractice litigation.

📌Can’t handle medico-legal stress, new draconian legislations, patient hostility, staff shortages. FED UP – ENOUGH IS ENOUGH!!

📌Changing Profession to any of the following

Full-time Advocate
Hospital administrator
Joining insurance industry
Joining Police department (after passing IPS exam)
Joining Govt administration after passing IAS exam.
Pharma business executives
Starting Pharma business
Medical education business
Builder
Hotelier
Share brokers
Successful spiritual leaders (referred to as Godmen!)

We have examples of each of these categories!

Obviously, they too need to wind up their medical practices methodically before embarking upon a more financially rewarding or satisfying profession.

Whatever be the reason for the decision to close your practice, there are certain issues that are common to all situations to be dealt with before you hang your stethoscope or put away your scalpel!

It is advisable not to stop your practice abruptly except in inevitable situations. After all, you are closing a professional practice and not a shop. Patients need to be given adequate notice of your decision to close practice. Do inform patients at least 30 days or more in advance by way of (a) Notice in your clinic (b) Personal letters to patients (c) Local newspaper announcement (in case of doctors having a large practice) (d) WhatsApp, Email, etc. If possible, mention a reason e.g. Relocating practice, going abroad, retiring, etc.

Not notifying patients can be construed as terminating a doctor-patient relationship and, what may be ominously termed by clever lawyers as, “patient abandonment”—an ethical and legal wrong (negligence) which could be actionable by Medical Councils and by various courts.

Incidentally, the definition of patient abandonment is as follows: The unilateral severance of the professional relationship without reasonable notice especially at a time when there is still a need for medical attention.

Undoubtedly, you have an obligation to your patients to inform them of the discontinuation of your practice and to make efforts to ensure continuity of care. In fact, it is advisable to offer assistance to patients in finding new providers of the same specialty. This would earn you the gratitude of the patients and give you the satisfaction of doing the right thing apart from giving you legal protection.

Additionally, patients are entitled to the availability of their medical records and hence you need to make arrangements for the same. Ideally, all records available with you should be handed over to the patient, and a receipt for the same taken. Alternately, you could make arrangements for the storage of the medical records and inform patients how they can access the same if needed. In appropriate cases, give adequate forwarding information. Electronic Medical Records (EMR) are now a game-changer in this regard and those who maintain records in this format may find it easier to deal with this issue.

Patient records should be preserved as per legal requirements. Typically, records are required to be preserved for 3 years (this happens to be the limitation period during which a patient has to file a case, else it gets time-barred). However, records pertaining to any medical litigation, past or present ought to be saved indefinitely. In spite of stopping the practice, sometimes courts, police, or other statutory authorities may call for records. If these are for cases beyond 3 years, you can claim to have destroyed them in non-medico-legal cases. Medico-legal case records should be preserved for 10 years. MTP, PCPNDT, etc records should be preserved as stipulated in the Acts. Ideally, Maternity records ought to be retrievable for 21 years (though such situations where such records are called for are not yet commonplace in India).

On a couple of occasions, we have had retired doctors receiving notices pertaining to patients they had treated in the past. This resulted in a predictable disturbance in their peaceful retired life. The situation is easier to handle if records are available.

In case you are handing over your practice to another doctor, you should transfer to him or her all the patients’ records as well and inform patients accordingly. However, make sure you will be entitled to access these records should the need arise.

It is advisable to surrender the licenses you may be holding after notifying the concerned authorities of your decision to close your establishment. Examples are: Nursing home registration (C form}, MTP Registration, PCPNDT license, MPCB Biomedical waste disposal authorization, Shops and Establishments registration (if you have one) and so on.

CAUTION: Please destroy your hospital stationery including letterheads, certificate forms, indoor blank papers, Receipts, Death certificate forms, etc. Misuse of these with unpleasant consequences is a possibility and instances of the same have occurred in the past.

Make sure your outstanding financial dues both Receivable and Payable are squared. Particularly your outstanding receivables from insurance companies/ TPAs.

Some bank accounts may need to be closed or modified.

Employees should be dealt with in a humane and legally correct manner.

✅Firstly, notify your staff about your decision to close down early enough. Preferably, do this in a group meeting and not individually.

✅Explain to them the reasons for your decision to close down.

✅Assure them of a fair settlement of their dues ---Gratuity, Provident fund, etc.

✅Make them a valuable part of the closing process.

✅If possible, offer them help in relocating to reduce their stress.

✅Some employees may prefer to leave prior to your closing.

✅Please remember, the continuing goodwill of your staff is important to prevent medico-legal issues. There are instances of such problems occurring even on the last day of your practice!

✅Plan optimal disposal of your existing medical equipment and gadgets. If you are unable to obtain a decent price for the same, consider donating it to a charitable hospital.

📎It is advisable to officially intimate the BMC about the closure and surrender of the Nursing home registration certificate.

📎In case, your Nursing home is given on rent or lease to some other doctor you have to decide whether your old registration should continue and used by the new doctor or whether you should surrender your registration and the new incumbent should apply for a fresh registration. Both have their pluses and minuses.

📎If the original registration continues, the possibility of your legal liability continues in case of a medico-legal event since the registration continues in your name. You could be named as a party in a legal action.

📎If you rent out or lease your premises make sure the legal agreement is formulated by a good professional and all safeguards are taken to protect ownership of your premises.

On the closure of an individual practice or change of profession should MMC be informed? Should you surrender your MMC registration? In case you surrender your MMC registration, make sure you do not give medical treatment to anyone thereafter. Even a patient whom you treat free can make allegations of negligence and you could face litigation.

📢Your colleagues deserve to be informed of your decision to quit from practice.

📢It will be a good idea to send a communication informing them of the same and thanking them.

An important decision that needs to be taken on the closure of your practice pertains to your Professional Indemnity Insurance which covers your professional legal liability –both personal and that of your establishment. Should you discontinue this insurance cover?

This insurance should be discontinued only if you are absolutely certain that you do not expect any patient treated by you in the last 3 years to develop problems which will lead him or her to file a medico-legal case against you.

In other words, there is a potential risk of a patient treated by you within the last 3 years to file a case against you in case he or she attributes some damage caused to him or her on account of treatment given by you.

Since one can never be too sure, it is prudent to continue your insurance cover and that of your hospital / Nursing home for at least 3 years or even longer (say 5 years to be safe).

And importantly, do not reduce your sum assured because the amount of cover available to you will be the one that you have at the time of the complaint, since the Insurance available in our country is “Claims-made Policies”. For example, if you had Rs 1 crore cover at the time you had treated the patient but have a reduced cover of 20 lakhs when the Claim was made (post-closure of practice), you will be entitled to a cover of only Rs 20 lakhs. The liability in excess of this will have to be borne by you.

Understandably, one would be reluctant to pay a large amount for indemnity insurance especially when you are not practicing. To address this issue AMC has initiated the concept of run-off cover which will be applicable post-retirement.

Under this facility, you could continue the same sum assured for a comprehensive period of 3 years post-closure of your practice by paying only one year’s premium. For example, if your premium for Rs 1 crore sum assured before the closure was Rs 20,000/, you could obtain a 3-year cover, if you are retiring, for only Rs 20,000 /- for Rs 1 crore cover. This is also known as Tail-coverage.

This facility of Run-off cover or Tail coverage, wherein a supplemental Policy will be issued is now available.

Having dealt with arrangements for patients, dealing with staff, medical records, statutory authorities, banks, etc what remains is dealing with yourself. Emotional, sentimental, family and financial adjustments need to be made so that you have a happy and trouble-free closure of Practice!!

CLOSING YOUR PRACTICE V/S SELLING OR LEASING YOUR PRACTICE

💊If you plan to close your practice, don’t do it abruptly. You must follow proper guidelines to avoid medico-legal problems.

💊Special care must be taken to give advance intimation to patients and help them locate other physicians of your specialty. Not doing so could be construed as patient abandonment.

💊Medical records of patients should be preserved and be accessible for the required period.

💊Statutory registering authorities, etc should be informed as per rules.

💊Staff should be intimated sufficiently in advance and their dues as per legal provisions paid.

💊Third-party payments/accounting should be taken care of.

💊Professional Indemnity Insurance should not be abruptly discontinued

💊Destroy your stationary

💊Various modes of discontinuing practice viz. shutting /renting /leasing/selling / corporate acquisition should be considered as per their pros and cons before making a final decision.

💊By doing this you can keep medico-legal implications at bay.

ABOUT THE AUTHOR

Dr. Lalit Kapoor is a General Surgeon practicing in Mumbai. He is the founder of the Medico-Legal Cell, Associaton of Medical Consultants, and is a medico-legal expert assisting affected members with medico-legal problems for over four decades. He is also the author of the book Better Safe Than Sorry- Medico-Legal Do's & Don'ts.