Risk Management Checklist When Closing Your Practice
Abstract
The checklist will help you close your practice while ensuring continuity of care for your patients and adhering to other legal obligations.
Preparing to close a practice for personal reasons or due to retiring, joining another practice, or starting employment at another facility can be stressful. Regardless of the reason, there are business practices and risk management strategies to consider.
Staff Notification
Notify staff as soon as possible and review the plans for closure.
Consult an attorney to ensure obligations to staff are met (for example, payroll, benefits).
Patient Notification
Once plans are finalized for closing the practice, inform your active patients of the plan and time frame with ample time to respond to their questions.
Send a notification letter to patients, and allow a minimum of 30 days’ notice for continuity of care, if possible. For planned closings, ideally provide patients with a 90-day notification of office closure.
Check your state regulations regarding patient notification requirements of office closure.
Include the following in your notification letter:
Date of closure
Referral options
How to obtain a copy of medical records and provide a HIPAA-compliant medical-record release form for transfer of records
Send the notification letter via certified mail, return-receipt requested, or hand the letter to the patient. Retain a copy of the notification letter in each patient’s record, and document how the letter was provided.
If patients ask for records, make a copy and send them to the person designated on the release form. Charge duplication fees per your state’s statutes.
Provide an appropriate supply of medication prior to office closure.
Cancel standing appointments scheduled after the date of office closure with documentation of patient notification.
Notification to Other Parties
Your insurance broker for your practice.
Payors (for example, Medicare and Medicaid).
State and federal regulators (for example, Drug Enforcement Administration, state licensing board).
Vendors and contracted service providers.
Landlord in accordance with the notification provision in the lease.
Professional associations (for example, APA).
Utilities.
Hospital and clinic affiliations.
Referral sources.
Notify the local post office and delivery services of change of address.
Consult legal counsel and an accountant related to these issues:
Dissolution/sale of business activities.
Tracking and filing tax information.
Retention of business/tax records that are required by state and federal law.
Creation of a plan for tracking outstanding accounts receivables.
Paying all outstanding bills (for example, rent, utilities, staff payroll).
Naming an administrator to oversee practice information in the event of death/disability.
Other considerations
Select a date in advance of the office closure to stop accepting new patients.
If leaving a practice or another psychiatrist is assuming your practice, contact your attorney regarding the contract discussions. Be certain you will have access to your patients’ medical records should you later be named in a claim.
Set up a medical record retention and destruction plan pursuant to state and federal regulations.
Establish a process for the sale/removal of office equipment and supplies, including wiping all equipment of HIPAA-sensitive information.
Ensure proper destruction of prescription pads and unused medications.
Update office email, voicemail, practice portal, and practice website with office closure message and direct patients how to obtain a copy of their medical records. ■
This information is provided as a risk management resource for Allied World policyholders and should not be construed as legal or clinical advice. This material may not be reproduced or distributed without the express, written permission of Allied World Assurance Company Holdings, Ltd, a Fairfax company (“Allied World”). Risk management services are provided by or arranged through AWAC Services Company, a member company of Allied World. © 2020 Allied World Assurance Company Holdings, Ltd. All Rights Reserved.
