Why does it appear that physicians are sued disproportionally more often and for greater amounts of money when compared to other professions and occupations?

The easy answer is that Florida physicians are in fact sued much more often and for greater amounts than other professions and occupation. The causes for this fact are several:

1. in order to practice medicine physicians must comply with Florida's financial responsibility law (458.320 Florida Statutes) which establishes a minimum $100,000 “pot of gold”. This provides aggressive personal injury lawyers a considerable target to aim at for malpractice law suits. These predators view the $100,000 as a guaranteed base line, however these legal eagles are really aiming for much bigger targets since they are working on a contingency basis. These attorneys assume that most physicians actually carry malpractice insurance of $1,000,000 or more, and have substantial assets which will be easy to discover and get Florida court judgments on them.
2. The second fact is that these personal injury lawyers are right - the physician has malpractice insurance and/or what are called non-performing assets.
3. Modern medicine in the USA has done such an outstanding job of selling its ability for curing diseases and saving lives that juries almost automatically assumes that the physician must have not performed up to standard if there is not a positive outcome.
4. There is an abundance of physicians with very impress credentials willing to give “expert testimony” based on a conjured up state of affairs and not on true facts of the situation.

Physicians Asset Protection Group, LLC (PAPG) can help make you less of a target for the aggressive personal injury lawyers

Disclaimer: Physicians Asset Protection Group, LLC of Florida provides practical asset protection and wealth generating information for educational purposes only. The goal is to help you better work with accounting and legal professionals to save costs, and to obtain better service and results as an informed consumer. There is no assurance that the laws or sample documents are current, that the forms will achieve the desired goal in all circumstances. Laws change annually in Florida, and federal law often directly determine what should be done to protect your assets and generate wealth. Therefore, you should always consult with Physicians Asset Protection Group, your attorney, accountant, or other experts that may make up to date timely recommendations.

I understand if the judgment in a medical malpractice case exceeds my medical malpractice insurance (or other means of meeting the Florida Financial Responsibility law) that the Florida courts may take from me such assets as stocks, bonds, saving accounts, moneys in checking accounts and money market funds, force the sale of real estate (except my Florida Homestead), and even collect on my accounts receivables?

True! It is not unusual for the physician to be successfully sued in excess of their medical malpractice limits – and the physicians are therefore forced to settle beyond the limits of the physician's malpractice coverage. No amount of malpractice insurance not 3 million dollars, not 5 million dollars, nor 10 million dollars or more will protect your personal asset, or even practice assets.

Physicians Asset Protection Group can provide you with guaranteed performing assets from $50,000 to $5,000,000 (or more) which the Florida courts will not even require you to list as assets in any malpractice law suit brought against you. These assets pay guaranteed minimum interest on the principle, on the accumulated interest, and tax deferred accumulations, you never take market losses, but participate in market gains, no management fees on most accounts, there may be early or non-scheduled withdraws fees.

Are there good methods available to protect both personal and practice assets from medical malpractice law suits in Florida?

It is our opinion that Florida has the best set of state laws, administrative rules, and court decisions in the USA to protect your personal and practice assets from malpractice law suits. In fact the asset protection laws are so good that even though you might regularly live and practice in a faraway state (e.g. Ohio, New York, etc.), we recommend you consider establishing your “legal Florida residence”, even while continuing to regularly live and practice in other states. Yes, we would be happy to explain how and why, and even assist you in establishing Florida as your “legal  Residence”. This is particularly true if you live and/or practice medicine in a state or local income tax, Florida does not have a state or local personal income tax. Call or email us to make an appointment.

Can I not just title all my assets in my spouse's name? My spouse is either in a low suit risk occupation or is not employed outside the home.

Do not title all or even most of your assets under your spouse's name! Death, disability, divorce, and other factors still can result in financial difficulties or even bankruptcy for you. And yes the courts have found that even though assets were titled in the spouse's name, they were functionally the marriage partner's assets, and therefore a judgment could be entered against these assets in the course of a malpractice suit.

Can assets be moved to stop judgments and liens on personal or practice assets once a medical malpractice suit has been initiated in the state of Florida?

Be extremely careful of financial or legal advisors who may advise you to move any of your assets once a suit has been initiated, you maybe even charged with criminal charges in some cases. Movement of assets to avoid judgments and liens is generally reversible by court order in Florida. Get a second financial and/legal advisor opinion

Is it true that in a Florida Malpractice suit the plaintiff can only collect up to the financial responsibility limits as provided for in 458.320 Florida Statutes and covered by one of the three Florida state approved methods and as to form:

1. Physician's malpractice insurance policy,
2. Irrevocable letter of credit from a Florida bank or saving, or
3. Establishing and maintaining an escrow account consisting of cash or assets eligible for deposit?

Actually, Florida courts often award judgments and liens far in excess of the financial responsibility limits as provided for in 458.320 Florida Statutes. Nothing in the Florida Statutes, the Florida administrative code, or decisions of the courts have place any cap upon total dollars damages in malpractice suits. There is no upper limit on the amount judgment and liens which may be levied and attempted to be collected by the plaintiffs and their legal teams.

What can I do to protect my personal, family, and practice assets?

The answer sounds simple, but is very complex – create and execute a comprehensive estate, tax, financial, and asset protection plan. Such a plan might include making irrevocable transfers into LLCs, FLPs, and trusts. Physicians Asset Protection Group, LLC can help you can make a comprehensive plan to protect and grow your assets. We will work with your current accountant and/or attorney, or refer you to accountants and/or attorneys who specialize in asset protection.

Is it true that my Florida legal primary residence (homestead – as outlined in the Florida Constitution, Article X, Section 4(a)-(c), and Article VII, Section 6) is exempt from Florida court judgments and liens in malpractice law suits claims?

This is absolutely true, Florida's homestead exemption provides for an exemption from forced sale before and at death is among the most protective in the United States with "no limit" to the value of certain real property that can be protected from creditors, so long as the property occupies no more than ½ acre within a municipality, or 160 acres outside of a municipality. The stipulation is in the Florida Constitution, Article X, section 4, so it cannot be changed without a constitutional amendment. People with court judgments from other states have often purchased expensive estates in Florida in order to protect large amounts of assets from creditors. Even with the decline in housing prices, Florida may still be one of the best places in the world to own residential property. The duplication construction cost plus land cost ratio makes most Florida residential property a real bargain.

The homestead exemption offers virtually absolute protection from forced sale to meet the demands of creditors, except under three specific conditions:

1. To collect past due property taxes;
2. Property that was specifically pledged as credit for a mortgage;
3. Mechanics (contractors) who are owed money for work performed in repairing or improving the property.

However, due to the Supremacy Clause in the United States Constitution, federal law supersedes state law, and homestead protection does not have any force to stop actions by federal agencies, nor does it affect rulings by a Federal court.

Homestead exemptions are only available on an individual's primary home. Therefore, this exemption does not apply to businesses, rental property, second homes, homeowner's claiming permanent residency-based exemptions or tax credits in other states, or homes with owners that do not claim Florida as their primary residence.

Under Florida law, the homestead exemption is only available to US citizens, permanent resident aliens, or others who are legally able to form the intent to remain permanently under immigration laws.

Is there a way to protect dollar based assets, such stocks, bonds, CD's, money market accounts, saving and checking accounts, and other such assets?

Florida law provides for a broad range of dollar based assets that are protected from judgments and liens. These assets do not even need to be listed as assets during the discovery process of a malpractice suit. The plaintiffs and their attorney will not know of these assets nor can they even legally demand this information during legal discovery. These assets are not traceable through credit bureaus or other ordinarily legal means. These assets are normally in the range of $50,000 to $5,000,000. Only you, the IRS, the Physicians Asset Protection Group, LLC staff members working on your case, and the dollar based assets provider will know of your investment, though most doctors have an accountant and attorney who are informed of the investment. These investments are low risk, with guaranteed minimum rates of return, that can participate market gains, but not the in the market losses.

These funds can provide triple compound interest:

1. Interest on the principle
2. Interest on the accumulated interest, and
3. Interest on the tax deferred income.

All taxes are deferred until profits are withdrawn. There are not any mandatory withdraw ages or periods. You are in control of the amounts withdraw. The maybe defined fees on some withdraws on some of these types of accounts, particularly on early withdraws prior to scheduled withdraw periods.

Are there ways to protect real estate and/or commodities (gold, silver, beef, wheat, etc.) investments from malpractice suits in the Florida courts?

Properly constructed legal entities will provide you maximum protection from judgments and on for these “solid goods”

Considering Florida Financial Responsibility (458.320 Florida Statutes) which of the three forms of compliance,

1. Malpractice insurance,
2. Irrevocable letter of credit from a Florida bank or saving association, and
3. Establishing and maintaining an escrow account consisting of cash or assets eligible for deposit

is best for me, my practice and my family?

This is a very complex question requiring knowledge of your goals and your current financial position. It often times changes with your circumstances? We are willing to assist you in making this decision, but all choices work, some just better than one or the other.

What other ways beside malpractice suits are physicians most likely to lose wealth?

The list is long including bad marriages, bad investments, bad advisors, bad tax planning, or a combination thereof top the list. Most of these risks can be can be reduced by adequate asset protection planning. In various investment schemes or tax shelters physicians got burned. Indeed, physicians are stalked by a variety of promoters hawking all sorts of schemes, from illegal tax shelters such as Irish/Barbados employee leasing schemes, to screwy and hyper-risky investments, to cookie-cutter offshore asset protection structures, and all sorts of other questionable schemes, and some them criminally illegal. The last thing you want is an IRS audit and many of these schemes almost assure you will be audited. In today's markets it is difficult to lower risks to acceptable levels.

I have heard there are kits that purport to allow the physician to form family limited partnerships and various special trusts. These kits are usually sold at “free seminars” for $2000 or more. Would this be a good buy?

Attorneys generally charge in the range of $2,000 to $6,000 to form family limited partnerships and various special trusts that the physician needs to create this critical level of asset protection. Whereas, the physician who takes his “legal form kit” home often creates a nightmare of tax and other consequences for himself. Yes, these forms in the kits are often created by licensed attorney. However how good are these kits? Let's put it this way: would you let a skilled automobile mechanic take out your gale bladder using only a textbook? If the physician makes himself the general partner of his own family limited partnership, he has virtually eliminated the asset protection benefit of the family limited partnership.

Can I use a Foreign Asset Protection Trust to protect most of my asset?

Although offshore trusts at first appeared that they might work for assets protection, the Anderson and Lawrence decisions have established that all a creditor must do is to have the court to enter a repatriation order against the settlor of the offshore trust, and if the settlor doesn't bring the assets back to the U.S., the court simply puts the settlor in jail until he does. Offshore trusts only work if the settler is prepared to leave the United States.

Would using an Employee Leasing Company be useful as part of an asset protection program?

Using an Employee Leasing Company and the services they offer separate the physicians and their limited liability professional practice. This has many benefits to both the limited liability professional practice and the partners, if all employees (including all professional partners) are paid reasonable salaries by the practice with any surpluses either held as operating reserves or distributed to the partners of the practice as an ordinary dividend income with no social security and Medicare payment required of the practice or the partners. If paid as bonuses to either employees and/or partners then social security and Medicare payments are required. Since employee salaries cannot be garnished in Florida, this becomes particularly important if any of the physician partners are sued for malpractice. Other advantages of using an Employee Leasing Company is they may for a very small fee handle all the payroll and personnel functions including local, state, and federal reporting and compliance.

Would using an Equipment Leasing Company be useful as part of an asset protection program?

Many physician practices require expensive medical equipment, or even substantial dollar amounts for less expensive furniture, office equipment, counters, storage cabinets, computers, refrigerators, etc. If this equipment is owned by the practice, or worse by one of the physicians individually, any equity in the equipment could be exposed to creditors. By using an Equipment Leasing Company wealth is stripped from the practice making the practice have a lower book value and therefore less of tempting target for malpractice lawyers.

It is never a good idea to establish a new limited partnership or LLC for no other purpose than to hold the equipment used in the practice. The existing equipment is then either sold or contributed to the equipment leasing entity, which then leases it back to the practice. Every dollar paid to the equipment leasing entity for use of the equipment is a dollar that is removed from the potential reach of the practice's creditors. However there is the danger that the company will be seized by creditors, if the creditors can convince a court that the arrangement is a sham. The few extra dollars spent using true hands off leasing company will have been worth it in the long run. It is nearly always worth spending pennies to save dollars.

Should the physicians or the practice own the real estate where their practices do business?

YES, by separating the real estate from the practice, a physician creates an additional means to remove money from the practice and thus away from future unknown creditors. As with equipment leasing companies, it is not enough to simply put the real estate into a different entity. The entity must be structured so that a creditor cannot seize the entity or convince a court that the leasing arrangement is a sham.

Should Accounts Receivable Factoring be part of our asset protection program?

Because insurance company and government health program payment run typically 30 to 120 days, one of the largest assets of a medical practice is the accounts receivable. This asset is also one of the most exposed to creditors. This is also a non-performing asset, i.e., the value of the accounts receivable is not earning any investment income. It also has expenses involved with its administration including tracking, billing, and collections. By selling the receivables at discount, a process known as "factoring", the practice can effectively remove its value to creditors and their attorneys, while simultaneously leveraging the asset for investment purposes and eliminating a major expense. This also accelerates cash flow and eliminates a burdensome administrative task. Factoring programs enhance the protection for this valuable, and usually completed exposed, asset.