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Rice adopts policy on physician recruitment agreements

WILLMAR -- Rice Memorial Hospital has adopted a new policy that lays out guidelines for helping local medical groups with physician recruitment.

The new policy, which was adopted unanimously Wednesday by the hospital board of directors, is similar to how Rice has offered recruitment help for the past several years.

But for the first time, the guidelines are now in writing, said Mike Schramm, chief executive of the city-owned hospital.

"What we haven't had in place is a more formal recruitment policy," he said. "It's a framework for how we can provide assistance if the need arises."

With a newly developed strategic plan that emphasizes enhancing local medical services and identifies specific specialties to be recruited, it has been a goal for the hospital to have an official recruitment policy.

"This has been something we've been working on for some time," Schramm said.

Among the provisions of the policy:

- There must be a demonstrated community need in order for Rice to assist with recruiting a physician.

- The physician who's being recruited must practice in the hospital's geographic area.

- Financial help can take the form of signing bonuses, relocation expenses, student loan repayment or an income guarantee. The compensation also needs to fall within fair market value.

- Recruitment agreements cannot stipulate that the physician has to refer patients to Rice Hohspital, nor can signing bonuses and the like be tied to the volume of patients or revenue the physician generates for the hospital.

- Individual recruitment agreements must be reviewed by an attorney before being signed by Rice.

- Hospital executives must report annually to the board on all the recruitment agreements currently in effect.

Many times in the past, Rice has helped Affiliated Community Medical Centers or Family Practice Medical Center with the cost of bringing in a new doctor, Schramm said. "It's been common for years and years."

For instance, the most recent agreement was with an orthopedic surgeon who joined ACMC last month.

These types of agreements often are necessary and expected for bringing a new doctor into the community and supporting him or her in building up a practice. Schramm said the new policy is flexible enough to give Rice some leeway in the terms for each individual agreement.

"There's discretion for us," he said. "The decision really rests with us on who we're going to provide assistance for."

"It doesn't obligate us to do anything," said Dr. Mark Matthias, chief medical officer at Rice.

Perhaps the most significant change is that individual recruitment agreements will no longer be brought to the hospital board of directors for approval. Instead, the board will be kept apprised with an annual report on the status of current recruitment agreements and costs.

The move creates more separation between policy-setting by the board and management by the hospital executive team, said Bill Fenske, chief financial officer. "There's really been a big paradigm shift in developing the policy," he said.

Anne Polta

Anne Polta covers health care, business/economic development and general assignment. Her HealthBeat blog can be found at Follow her on Twitter at @AnnePolta.

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