How to divest acquired physician practices.

ABSTRACT

When an integrated delivery system (IDS) determines it must divest itself of a previously acquired physician practice, it must manage the transaction with care. The IDS most likely will want to maintain a positive ongoing relationship with the physician practice, while avoiding concessions to the practice that could be construed as violations of state and Federal laws. Before proceeding, the IDS should evaluate the reasons for divesting the practice, assess legal issues involved in terminating contracts with the practice, decide how to deal with the practice's assets and office facilities, consider whether covenants not to compete should be enforced, ensure continued access to essential medical records, consider whether to incorporate a "non-disparagement" clause in the termination agreement, and determine what mutual general releases may be necessary.