Asset protection

Discussion in 'General Residency Issues' started by Pinky, Apr 17, 2004.

  1. Pinky

    Pinky and the Brain
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    In preparation for the day that the inevitable malpractice suits hit, I was wondering how to protect my future assets (my current assets consist of an old car and ~$500 in cash).

    I've thought about hiding liquid assets in my children's bank accounts? Any other suggestions?

    Each year, a sales rep from one of the Insuranace or Investment firms always gives a noon lecture on "wealth protection" but I always seem to miss it.
     
  2. doc05

    doc05 2K Member
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    you might want to try the Cayman islands.
     
  3. southerndoc

    southerndoc life is good
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    I'm not sure how Texas is set up, but Florida has a really sweet deal. Nobody can touch your house (not even the government). Invest in a bunch of pricey art and it becomes part of your house!

    From what I've heard, 401(k)'s, IRA's, and pension plans are untoucheable. However, 403(b)'s are not considered true retirement plans by the Supreme Court and can be touched by someone who wins a lawsuit against you. This was told to me by a MAG Mutual (Med Assn of Georgia) representative.
     
  4. Kalel

    Kalel Membership Revoked
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    Historically, medical malpractice settlements that exceed your malpractice insurance coverage have not resulted in plantiff lawyer's going after physician's personal assets. I've heard that they do have the right to seize your personal assets if they choose to (since they are civil lawsuits filed against you personally), but it's almost never done just because of precendence and tradition.
     
  5. Homunculus

    Homunculus SDN Caveman Administrator
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    works for OJ. between his house and his NFL pension (also untouchable by lawsuits) he not only hasn't paid a dime in his civil suit conviction, he's living a pretty cush lifestyle.
     
  6. docB

    docB Chronically painful
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    I've been heavily looking into this myself lately. I have found that even the lawyers can't agree on much of this stuff.
    Can they seize your house? Yes. Is it rare? yes but that's not all that comforting.
    Can you put your house in a trust to protect it? Yes but it's not iron clad. A judge could dissolve the trust and take your house if he wanted to.
    Can you transfer your house to your minor children to protect it? Yes but this is a minefield as your kids can get audited and run into other problems.
    Can you put your house in trust for your children? Yes, this is not iron clad either but it is probably the most protected.
    One thing I know for sure is that once you get sued you can't do anything. You can't sell or give away your house or any assets as this will be viewed as a fraudulent transaction and you'll be on the hook for what ever you sold or gave away.
    Is it a good idea to periodically cash out any equity you have in a house so it won't be attractive to a plaintiff? I don't know. I'm trying to find out.
    I would recommend cashing out equity to pay off student debt because the last thing I want is to get sued out of my house and still have my loans over my head.
    Basically MedMal is a giant s--t sandwich for everyone in medicine. For plaintiffs it's a giant bottomless gold mine.
     
  7. Yogi Bear

    Yogi Bear 2K Member
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    so among physicians/med students/residents, how many sign a pre-nup?
     
  8. group_theory

    group_theory EX-TER-MIN-ATE!'
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    In this day and age where roughly half of all marriages end up in divorce court, you must sign a pre-nup. There is no good excuse not to. It might not be romantic, but it is something that you and your SO have to confront.

    Anyway, I remember reading from "Medical Economics" that the worst fear of a plantiff's lawyer is when the physician/defendant declares bankruptcy. Now I am just a med student, not a lawyer or a businessman or financial advisor.

    http://www.singerxenos.com/new/singerxenos/newsletter.asp?storyid=1612926312

    Some selected quotes from the above website

    "some doctors found it beneficial to declare voluntary bankruptcy. Contrary to popular belief, bankruptcy is not a dirty word, but rather a process in which the physician can retain all their protected assets and have their malpractice judgments discharged. It essentially wipes the slate clean. Unlike a malpractice case, which takes 4-6 years and is psychologically grueling for a physician, a voluntary bankruptcy can be completed in 30-60 days. Of course, we always attempt to settle cases without going to bankruptcy. It should be noted that in most cases where doctors went through bankruptcy, the $250,000 financial responsibility was discharged by the court and the physician was able to retain their medical license."

    "Over the years, we learned that being prepared to declare bankruptcy is actually the best way to fight a malpractice claim. We believe that plaintiff attorneys are primarily motivated by their ability to get awards for their clients, and thus be compensated through the contingency system. It can be very effective in some cases to argue the financial reality of a case rather than the medical merits."

    however, keep in mind that the above situation only deals with physicians who decide to go "bare". But discuss this with a lawyer, a financial consultant/advisor, or other appropriate professionals to get the best advice.

    Anyway, that's my $0.02

    Group_theory
    "as you may know, $0.02 is not free - please feel free to contribute karma points to offset the cost of the $0.02"
     
  9. Mirror Form

    Mirror Form Thyroid Storm
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    You're right that it generally doesn't happen often. However, do you really want to be at the mercy of a lawyer to "do the right thing?" Also, lawyers can use a doctor's personal assests as a threat to force a huge out of court settlement. For example, John Edwards made lots of money by telling doctors that if they didn't settle out of court for the maximum amount their insurance would cover, he'd go after every single personal asset they owned.
     
  10. ortho2003

    ortho2003 Senior Member
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    I have to say that I disagree 100% on the pre-nup, but the rest of the information is very interesting. Thanks for the link.
     
  11. Masonator

    Masonator Senior Member
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    I think you should bury your $500 dollars in a jar and draw up a treasure map so you can find it again. As for the car, park it at a friend's house.
     
  12. Mirror Form

    Mirror Form Thyroid Storm
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    HAHAHAHAHA, that even made my dad laugh!
     
  13. Goofy

    Goofy Senior Member
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    Those of you who actually believe in the power of a pre-nup are smokin' something other dope. Pre-Nups aren't worth the paper they are written on, and can be circumvented by even the dumbest of lawyers (redundant?).
     
  14. Goofy

    Goofy Senior Member
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    Any physician who leaves personal assets unprotected deserves to have lawyer scum threaten em with em. There is no logical reason for anyone on this forum not to have 100% of your assets, including the family dog, protected. Asset management is something that should be taught instead of biochemistry in med school as far as I'm concerned. It behooves everyone to become an expert in this vital skill amidst lawyer scum free for all that exists. I know I did.
     
  15. Goofy

    Goofy Senior Member
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    Docb, your sophomoric post bleeds ignorance (no offense intended). That you would post such glaring misinformation screams of a much bigger problem in the medical field. As a group, physicians have absolutely no clue about the nuances in medicine. Your post reads like something you heard on the radio.

    The simple fact is that every last bit of your empire can and should be protected. There are rather simple ways to totally eliminate any personal liability whatsoever. The only reason one's house might be at risk is because it wasn't protected to begin with. Asset protection is 100% fool proof.
     
  16. DireWolf

    DireWolf The Pride of Cucamonga
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    Klebsiella,

    Care to share your wisdom on asset protection or are you just here to yell at everyone?
     
  17. Goofy

    Goofy Senior Member
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    I'm not yelling at anyone. I am responding deliberately and directly to an innaminate post. I even cautioned against taking offense.
     
  18. DireWolf

    DireWolf The Pride of Cucamonga
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    No offense taken. Just wanted in on your wisdom.
     
  19. juddson

    juddson 3K Member
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    I'd love to hear this. How, exactly?

    BTW, is it important that ALL doctors protect their assets from lawsuits, or ONLY good doctors? Should bad doctors also protect thier assets? Or are there no bad doctors?

    judd
     
  20. Docgeorge

    Docgeorge Bent Over and Violated
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    Easy, there are no bad doctors, just bad lawyers.
     
  21. Goofy

    Goofy Senior Member
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    Let me put it to you guys/gals this way. ALL physicians should have a comprehensive asset protection plan implemented. You WILL be sued by blood sucking lawyers. Trust me.

    They are systematically dismantling everything good about medicine. We no longer can rely on 'standard of care' to protect ourselves from frivolous lawsuits. Ther reason being is that a jury of our so called 'peers' (who have likely not completed high school, don't understand or care what dna evidence is, a quite frankly view physicians as evil) will be handing out the judgements. It is irrelevant who is right or wrong. What is important is who knows how to talk to this jury of illiterates. That be the lawyers.

    Having said that, I have received several private messages, and some responses asking the best way to do it. I realize my responses come off as a bit narcissistic at times, but I assure all involved I am attempting to motivate a new generation to take the bull by the horn. Many of you are early in your careers, or haven't even started yet. Asset protection will be a far more important subject to your family and future than your knowledge of plexus innervation.

    Rather than post an exhaustive novel here on the boards, I will point you to a book more important than greys anatomy. http://www.amazon.com/exec/obidos/ASIN/0965460517/ref%3Dpd_bxgy_text_1/102-4286131-9888168 This is a good first step.

    Family limited partnerships are perhaps the most powerful way for a physician to protect whats his/hers from blood thirsty lawyers. It's a tool that has been around for a long time and has only recently come into favor. Further, it is an excellent way to limit your tax burden and further your estate planning needs. This is a rock solid way to protect assets, and has successfully weathered the trials of time. It does require you find a competent, cough, lawyer to set up properly.
     
  22. BigBopper

    BigBopper Senior Member
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    Learning how to protect your assets is incredibly important. Learn it now or learn it when it is too late. The choice is yours.

    There is no 100% foolproof method but there are many ways to make it extremely difficult to people to get a hold of your money. The laws vary by state. Florida has very good asset protection laws- why do you think OJ moved there? I seriously doubt that he has paid out very much money on the mulitmillion dollar civil suit he lost. Family limited partnerships, LLCs even offshore accounts should all be disccused with your asset protection lawyer.

    If you go "bare" on you malpractice insurance and your your assets are very well protected, there are very few lawyers who take a case if there is no chance that they are going to get very much money.
     
  23. Goofy

    Goofy Senior Member
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    BigBopper,

    Going 'bare' is actually phenomenal way to fight the legal nightmare we have been given. I have been advocating it for some time. There are barriers however. For example some states, like ny, nj, ct require malpractice insurance. Further, most hospitals require it for admitting priveleges. It makes it more difficult to implement. I believe we need to work with hospital administrators to alleviate the burden of this rule. With a solid asset protection plan in place, going bare is a no brainer where feasible.
     
  24. Goofy

    Goofy Senior Member
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    I realize this comment was written tongue in cheek, but it brings up another important point. We as physicians need to police ourselves. As a group I believe we render excellent care. The percent of corrupt physicians is probably a fraction of 1%. Nevertheless, we must make sure to handle these problems internally as best we can.

    'Bad Lawyers' <---redundancy?
     
  25. Masonator

    Masonator Senior Member
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    I like the hatin' I'm seeing on this thread! We are hatin' on bad doctors, stupid doctors, and all lawyers. We are also hatin' on people who spread misinformation about asset protection. You all are some asset protecting, playa hatin' mother****ers!
     

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