USACS at it Again

[brabbit2222]

You were in the VEP merger cohort too, huh?

18% sounds about right. I probably did the math differently than you, but the way they presented it made it real hard to compare apples to apples.

Did you choose the W-2 $20/h straight-up pay cut or the 1099 pay-our-taxes-now-serf 83(b) option?

I chose the latter, 1099. What actually hurt the most, believe it or not, was not the initial ~$40k tax hit (had to borrow money from family to pay that one), but rather all the time I've wasted dealing with the extra tax forms and other paperwork for this silly S-corp they forced me to form. And all the wasted time researching the original W-2/1099 decision itself, which I suspect turns out not to matter either way in terms of take-home pay.

Especially if all the USACS shareholders get reamed, again, in 2026 by Apollo.

And in the past 3 months they cut my pay by another ~$10/h on top of the first hit by implementing productivity-based pay. Their math on this was not a good deal for me as a nocturnist at a single-coverage rural shop with pretty low census at baseline.

Did you know Steve and Dom had been talking about this deal for years, at least since USACS was EMP, just biding their time? At least, that's what they told us in their presentations. I imagine they planned this merger to coincide with the turnover of USACS' C-suite.

I stayed 1099, declined the offered shares and didn't have to pay any taxes. Compensation at my VEP site remained unchanged after the merger, as it was RVU based before, as well. Not much changed overall at least for me, to be honest.

---

Members don't see this ad.

 

[hundreddaysoff]

I stayed 1099, declined the offered shares and didn't have to pay any taxes. Compensation at my VEP site remained unchanged after the merger, as it was RVU based before, as well. Not much changed overall at least for me, to be honest.

All the full-timers in my group were told we had to take $75k in shares, as "every full-time USACS doc is an owner" or somesuch. My understanding from SDN is USACS has been telling all full-time docs that for years, so I figured it was standard operating procedure and there was no way around it. Plus, at the time family and I planned to stay in CA for over 5 years.

I'm guessing you're part-time as USACS defines it; I think it's <1000 hours/year?

Or else there's something special in your contract because you're RVU-only?

In any case, you aren't a full "owner" as USACS defines it, right?

If I really didn't have to take the offered shares, gonna kick myself so hard...

 

[brabbit2222]

All the full-timers in my group were told we had to take $75k in shares, as we all needed to be "owners". My understanding from SDN is USACS has been telling all full-time docs that for years, so I figured it was standard operating procedure.

I'm guessing you're part-time as USACS defines it; I think it's <1000 hours/year?

Or else there's something special in your contract because you're RVU-only?

In any case, you aren't a full "owner" as USACS defines it, right?

If I really didn't have to take the offered shares, gonna kick myself so hard...

I'm full time, and not sure if there was something special about our site contract. But as I recall, during one of those zoom meeting during transition time, the leadership said we can decline shares if we wish.

 

[southerndoc]

All the full-timers in my group were told we had to take $75k in shares, as "every full-time USACS doc is an owner" or somesuch. My understanding from SDN is USACS has been telling all full-time docs that for years, so I figured it was standard operating procedure and there was no way around it. Plus, at the time family and I planned to stay in CA for over 5 years.

I'm guessing you're part-time as USACS defines it; I think it's <1000 hours/year?

Or else there's something special in your contract because you're RVU-only?

In any case, you aren't a full "owner" as USACS defines it, right?

If I really didn't have to take the offered shares, gonna kick myself so hard...

Any company that forces you to buy shares is a huge red flag.

 

[EctopicFetus]

TH “bought out our group”, and said nothing will change. Pay would not change whatsoever. I stayed 2 yrs to fulfill the buyout. (Very grateful for the nice buyout bc I put the whole buyout into RE and 10x my buyout in 7 yrs).
Right after I left, they started
1.rvu based pay “it will be income
Neutral”. Bahahaha
2. Cut shift lengths
3. Eliminated a shift
4. Made docs go home early when census low.

Now all the legacy docs are essentially gone.

This is the way. have to get their money back.

 

[hundreddaysoff]

I'm full time, and not sure if there was something special about our site contract. But as I recall, during one of those zoom meeting during transition time, the leadership said we can decline shares if we wish.

Yes, I'm pretty sure you had a special site contract and USACS forced most VEP docs to own shares, either by taking a pay cut and becoming W-2 or paying taxes on the $75k 83(b) grant and staying 1099 with their prior pay.

This is the money shot from a 4/12/2021 email from VEP as the merger was beginning:

"Full-time physicians who are NOT VEP shareholders [which I wasn't] but become employees [ie W-2] will receive a Grant of $75,000 worth of USACS stock along with the money needed to pay the tax on it (which varies but is around $45,000). Incorporated physicians [ie 1099s who started their own S-corps and paid themselves via W-2 as USACS demanded] who are full-time will ALSO receive a Grant of $75,000 worth of USACS stock but will NOT receive the cash to pay the tax. All full-time employees, be it of one’s own corporation or of USACS will be owners."

I do not believe your carve-out was available to our group. Again, probably because you are RVU-only.

To emphasize, we were not given the option to stay straight sole-proprietor 1099 and keep our full-time ER jobs. We needed to become "employees" of someone, either USACS or ourselves, or else find another job.

 

[hundreddaysoff]

Any company that forces you to buy shares is a huge red flag.

No argument, and in general this is a great teaching point for new attendings. Avoid USACS if you can!

I knew USACS were weasels before the merger and turned down several otherwise-nice jobs just because they were USACS.

My quality of life here in paradise is so good, and I was so tired of moving my family around, that I figured staying with USACS was the lesser evil. By math, in keeping my extra $20/h as 1099, I also would've made back the $40k I paid in extra 2021 income tax after 2000 hours, or about 18 months of work. And then I didn't need to care what USACS' fake shares were worth.

Also, there are only 2 ERs within a 90-minute drive of me, and believe it or not the other shop is still the worse to work at (I tried both).

Sometimes it's about more than the money.

 

[emergentmd]

OMG. Forced to buy shares? They will help pay taxes? Man, this crap must be borderline illegal.

Such a nice set up.

I will open a FSER tomorrow. I will pay each owner $500K/yr in "Shares" and I will pay for their taxes on the 500K. Mind you, I prob can find a work around by declaring these 500K shares worthless at current market value thus no Taxes. But it sure sounds good to the docs that I am benevolent enough to cover the "large" tax bills.


Final point, how is 75K fake shares = 45K in taxes? That is 60% taxes. bhahahahaha.

And docs fall for this?

Imagine a publicly traded company
1. go IPO
2. Set whatever price I want for shares
3. Force buyers to pay $100/share b/c I said that is what it is worth
4. You can't sell your shares and when you do, the "market"=emergentLLC will determine the value. Likely value it at $1 b/c I don't have $100/share to pay out
5. Never do quarterly earnings call, just tell the docs things are great
6. When things go bad, I will just rinse and repeat. Sell more shares to the "owners" b/c they either buy it to keep their mountain of past shares or they leave knowing all their shares are worthless.

Geeeezzzz. I am glad USucks never penetrated where I lived. TH actually gave us a buy out and kept things the same for 2 years during out restricted period. They didn't pull the plug or have some golden handcuffs with fake shares keeping me stuck in the job.

This is almost laughable that docs are falling for this. Seriously, are docs that dumb to accept fake shares as payment?

 

[hundreddaysoff]

OMG. Forced to buy shares? They will help pay taxes? Man, this crap must be borderline illegal.

That's what multiple friends and family have said. As I see it, my options are

(1) pay a lawyer $500/h for x hours only to be told with 95% chance that yes, it's legal, or

(2) cut my losses, spend that time doing more productive things, and just move on to a much better-paying hospital W-2 job without any financialization trickery.

Final point, how is 75K fake shares = 45K in taxes? That is 60% taxes. bhahahahaha.

Remember that this only applies to CA docs and CA has a 9.3--11.3% state income tax for most docs. My state bracket is 9.3% and this extra phantom income pushed me into the 33% bracket, so I expected ~40% taxes.

FWIW, I actually claimed "only" about 30k in total extra taxes on this as I was told the 20% 199a deduction applies since I filed Form 1120S. We'll see if the IRS buys this sometime soon, hopefully. I didn't know that 199a applied to 83(b) taxes at the time the taxes were due (CPA didn't think to tell me at the time), so I withheld $40k as TurboTax suggested, as the year before I had under-withheld bigly as 1099 and was hit with late fees.

30k / 75k = 40%

I don't actually know where USACS pulled that 45k number from. Being conservative, I guess.

 

[southerndoc]

If they pay for your shares, then they pay for your taxes, do you then not have to pay taxes on the money they gave you to pay taxes? Seems like a never-ending circle.

 

[hundreddaysoff]

If they pay for your shares, then they pay for your taxes, do you then not have to pay taxes on the money they gave you to pay taxes? Seems like a never-ending circle.

I don't know the answer to that and didn't need to learn because I took the 1099 option.

Anyone on here take the W-2 option who can enlighten us? Bueller?

 

[EctopicFetus]

If they pay for your shares, then they pay for your taxes, do you then not have to pay taxes on the money they gave you to pay taxes? Seems like a never-ending circle.

Yep. But there is a number. Usacs is the worst. It’s like drinking diarrhea water

 

[emergentmd]

That's what multiple friends and family have said. As I see it, my options are

(1) pay a lawyer $500/h for x hours only to be told with 95% chance that yes, it's legal, or

(2) cut my losses, spend that time doing more productive things, and just move on to a much better-paying hospital W-2 job without any financialization trickery.

Remember that this only applies to CA docs and CA has a 9.3--11.3% state income tax for most docs. My state bracket is 9.3% and this extra phantom income pushed me into the 33% bracket, so I expected ~40% taxes.

FWIW, I actually claimed "only" about 30k in total extra taxes on this as I was told the 25% 199a deduction applies since I filed Form 1120S. We'll see if the IRS buys this sometime soon, hopefully. I didn't know that 199a applied to 83(b) taxes at the time the taxes were due (CPA didn't think to tell me at the time), so I withheld $40k as TurboTax suggested, as the year before I had under-withheld bigly as 1099 and was hit with late fees.

30k / 75k = 40%

I don't actually know where USACS pulled that 45k number from. Being conservative, I guess.

This just seems so weird to me and makes me feel they just threw out numbers do docs feel they are getting 75K in something when there is zero value filed with the IRS.

I do not know of anyone paying 60% taxes which is 45K out of 75K. Businesses can't just say they are paying 45K in taxes for the employees b/c everyone has a different tax rate depending on many factors.

They can say they will cover the taxes, but this would have to be done after you paid the IRS taxes on 75K income.

Typically if I got 75K in "stocks", I immediately exercise those stocks thus its income. I file 75K in taxes, pay 30K or so. Then USucks would write me a check for 30K as income, which I would pay taxes on that extra 30K. If they want to really make this tax neutral, they could assign you a typical tax bracket of 35% and pay you 30K+.35(30K)

This is why all new docs need to "buy in". It is forced 75K pay cut which they put lipstick on as income so most docs won't complain b/c they feel like its just like putting another 75K into retirement.

What a bunch of crap. It sounds more like a 75K pay cut, No taxes paid on worthless stocks, and Docs have the "stock" handcuffs chaining them from not wanting to leave.

What a bunch of hucksters preying on gullible docs. If you asks them when you can pull the $$ out and what the value is pegged to, a vague answer means the value is worthless and arbitraty.

 

[EctopicFetus]

This just seems so weird to me and makes me feel they just threw out numbers do docs feel they are getting 75K in something when there is zero value filed with the IRS.

I do not know of anyone paying 60% taxes which is 45K out of 75K. Businesses can't just say they are paying 45K in taxes for the employees b/c everyone has a different tax rate depending on many factors.

They can say they will cover the taxes, but this would have to be done after you paid the IRS taxes on 75K income.

Typically if I got 75K in "stocks", I immediately exercise those stocks thus its income. I file 75K in taxes, pay 30K or so. Then USucks would write me a check for 30K as income, which I would pay taxes on that extra 30K. If they want to really make this tax neutral, they could assign you a typical tax bracket of 35% and pay you 30K+.35(30K)

This is why all new docs need to "buy in". It is forced 75K pay cut which they put lipstick on as income so most docs won't complain b/c they feel like its just like putting another 75K into retirement.

What a bunch of crap. It sounds more like a 75K pay cut, No taxes paid on worthless stocks, and Docs have the "stock" handcuffs chaining them from not wanting to leave.

What a bunch of hucksters preying on gullible docs. If you asks them when you can pull the $$ out and what the value is pegged to, a vague answer means the value is worthless and arbitraty.

It’s reason #1 of many why usacs is the crappiest of the cmgs. Their privately held stock which you can’t sell hasn’t outpaced the sp500 and you are stuck holding it. On top of that you are looking at a huge pay cut working for them as compared to their peers.

 

[sum dude]

So USACS has a potential debt of 1.4b in 5 years at 10% interest with an annual revenue of 150M. So who signed off on this deal?

Welsh-Carson--they got bought off, made their multiple (200-300%?), keeps a small stake of stock in company to "let ride". Welsh Carson wanted out and got it...they were calling shots in company. FWIW, Welsh Carson were much more competent at managing money than the former Ohio group leaders who all got fired or "reassigned"

 

[sum dude]

Those numbers vastly different from the ones implied in the article above. Unless I missed something.....

Don't confuse Revenue w/ EBITDA ("profit" surrogate). Revenue is $900mil, Moody's estimates Debt/EBITDA of 5.0, so EBITDA of about $75 Mill, w/ $20M of cash plus Free cash flow of 5-10 mil, so USACS basically has ~$100M to back the rest of the debt

 

[hundreddaysoff]

Welsh-Carson--they got bought off, made their multiple (200-300%?), keeps a small stake of stock in company to "let ride". Welsh Carson wanted out and got it...they were calling shots in company. FWIW, Welsh Carson were much more competent at managing money than the former Ohio group leaders who all got fired or "reassigned"

This meshes with my general gestalt of many of the USACS physician leaders even currently. Unlike PE, they are not intentionally evil; many of them really do still work a few shifts a month at their local shops, and I'm sure they are excellent clinicians for the most part. I suspect at least one used to be a regular on this forum, and I benefited greatly from their posts when I was a med stud.

Many of the ones I've talked to seem like true believers in The Power Of Cheese #Ownit. Some were formerly big in the academic cathedral system, and it was an easy transition to the corporate cathedral because they are real good talkers. The system happened to "work" for them and they ascended and achieved their personal dreams. But they never thought too hard about what it would really take to run an ethical medical business that can make a profit. And they do not necessarily see how badly they are screwing over their soldiers and associates (to use a Mafia metaphor).

Now they believe they have The Power To Change Stuff And Fight Big Business In Medicine (TM). But one cannot use the methods of evil to fight evil. And what this excellent thread has taught me is that, despite their earnest denial, they are really all just puppets of PE. (Many of them will be highly paid puppets in 5 years of course...)

Either that, or they really are PE-level evil and they're just much better at deception than I can imagine. Like, Littlefinger-level good at deception.

 

[EctopicFetus]

This meshes with my general gestalt of many of the USACS physician leaders even currently. Unlike PE, they are not intentionally evil; many of them really do still work a few shifts a month at their local shops, and I'm sure they are excellent clinicians for the most part. I suspect at least one used to be a regular on this forum, and I benefited greatly from their posts when I was a med stud.

Many of the ones I've talked to seem like true believers in The Power Of #Ownit. Some were formerly big in the academic cathedral system, and it was an easy transition to the corporate cathedral because they are real good talkers. The system happened to "work" for them and they ascended and achieved their personal dreams. But they never thought too hard about what it would really take to run an ethical medical business that can make a profit. And they do not necessarily see how badly they are screwing over their soldiers and associates (to use a Mafia metaphor).

Now they believe they have The Power To Change Stuff And Fight Big Business In Medicine (TM). But one cannot use the methods of evil to fight evil. And what this excellent thread has taught me is that, despite their earnest denial, they are really all just puppets of PE. (Many of them will be highly paid puppets in 5 years of course...)

Either that, or they really are PE-level evil and they're just much better at deception than I can imagine. Like, Littlefinger-level good at deception.

Dom bag knows he is a short POS. He doesn’t care. He lies with the ease of a sociopath. If you haven’t met his undersized protuberant bellied self you aren’t missing much. The USACS people are like their own religion, the people in the know understand they are screwing others. Everyone else is a pawn. They think they are special so the game continues.
be clear they took on insane debt from a loan shark. Look at the terms of the preferred stock Apollo took. Make no mistake USACS wanted someone to buy the WCAS shares but they found no takers and WCAS forced usacs to borrow at terrible terms. Keep in mind it’s at 6-10% now with little to no risk and what’s gonna happen in 5 years when the debt is due and interest rates are sky high.
what’s interesting is they are the only CMG still buying up groups. Hopefully they lose a bunch of contracts and go bankrupt.

 

[hundreddaysoff]

That's what multiple friends and family have said. As I see it, my options are

(1) pay a lawyer $500/h for x hours only to be told with 95% chance that yes, it's legal, or

(2) cut my losses, spend that time doing more productive things, and just move on to a much better-paying hospital W-2 job without any financialization trickery.

Remember that this only applies to CA docs and CA has a 9.3--11.3% state income tax for most docs. My state bracket is 9.3% and this extra phantom income pushed me into the 33% bracket, so I expected ~40% taxes.

FWIW, I actually claimed "only" about 30k in total extra taxes on this as I was told the 20% 199a deduction applies since I filed Form 1120S. We'll see if the IRS buys this sometime soon, hopefully. I didn't know that 199a applied to 83(b) taxes at the time the taxes were due (CPA didn't think to tell me at the time), so I withheld $40k as TurboTax suggested, as the year before I had under-withheld bigly as 1099 and was hit with late fees.

30k / 75k = 40%

I don't actually know where USACS pulled that 45k number from. Being conservative, I guess.

Belated update: A few months ago, after I resigned from USACS, they did mail me a check for ~$25k. This was the value of my shares as they had calculated them at my time of departure. As I had already paid taxes on the basis for this, the amount I still owed on it in taxes (IMO) was minimal.

Still not planning to work for USACS again, but I did want to post an honest end to the saga I described in this thread.

Curious whether anyone on here who departed from USACS in the past 6 months--1 year was *not* recompensated for their shares. There's a lot of confusion among current USACkers I know about whether their shares would even be redeemed if they left.

 

[turkeyjerky]

Belated update: A few months ago, after I resigned from USACS, they did mail me a check for ~$25k. This was the value of my shares as they had calculated them at my time of departure. As I had already paid taxes on the basis for this, the amount I still owed on it in taxes (IMO) was minimal.

Still not planning to work for USACS again, but I did want to post an honest end to the saga I described in this thread.

Curious whether anyone on here who departed from USACS in the past 6 months--1 year was *not* recompensated for their shares. There's a lot of confusion among current USACkers I know about whether their shares would even be redeemed if they left.

Looking at your previous posts, is this how it worked?
--They granted you 75, in stock, at the time of the merger w/ VEP (assuming this was your previous employer). You pay taxes on it.
--you stayed on for a while
--stock is valued at 25k at the time of your departure, and they compensated you for it (ie repurchasing the stock). It sounds as though you were actually granted '75k' worth of stock at the time of merger rather than it vesting over time, right?

Does this mean that usacs has suffered a 66% reduction in value over the past 2.5 years? Does this mean that they are essentially shorting themselves, with their docs as the fall guys? Cause that's what it sounds like, accounting trickery to shift tax liability onto their docs.

Like, say I had a lemonade stand w/ one employee and 100k in annual revenue. I decide I'm going to make him co-owner. I value the company at 200k and grant him '100k' in stock and he dutifully pays the 20k in taxes. A year later he gets fed up and quits (b/c I stopped paying him and actually annual profits were only about $1000, due to company costs such as lease on my new company car, cell phone bill, business "dinners", naming rights for a local stadium and so on). At this time I revalue the company at 10k and dutifully buy him out for 5k (his half).

 

[hundreddaysoff]

Looking at your previous posts, is this how it worked?
--They granted you 75, in stock, at the time of the merger w/ VEP (assuming this was your previous employer). You pay taxes on it.
--you stayed on for a while
--stock is valued at 25k at the time of your departure, and they compensated you for it (ie repurchasing the stock). It sounds as though you were actually granted '75k' worth of stock at the time of merger rather than it vesting over time, right?

Does this mean that usacs has suffered a 66% reduction in value over the past 2.5 years? Does this mean that they are essentially shorting themselves, with their docs as the fall guys? Cause that's what it sounds like, accounting trickery to shift tax liability onto their docs.

Like, say I had a lemonade stand w/ one employee and 100k in annual revenue. I decide I'm going to make him co-owner. I value the company at 200k and grant him '100k' in stock and he dutifully pays the 20k in taxes. A year later he gets fed up and quits (b/c I stopped paying him and actually annual profits were only about $1000, due to company costs such as lease on my new company car, cell phone bill, business "dinners", naming rights for a local stadium and so on). At this time I revalue the company at 10k and dutifully buy him out for 5k (his half).

No, my shares were only ~20% vested by USACS' rules since I only held them 1 year. The value of the shares had appreciated quite a bit by USACS' math, which is why I did owe a few $hundred in long-term capital gains tax.

So, USACS is definitely tricky, but AFAICT not in that specific way.

 

[USACSburner5]

So I quit a month or so ago. As usual the board of directors had their quarterly meeting in mid May and had to approve buy back of shares from each departing physician. My shares were bought back in the last few weeks. What wasn't so typical was the rumor mill. Rumor has it that a few dozen departing physicians, who had been there for years, were told their shares would not be bought back"for now". Not sure why some people were redeemed and others weren't. Not sure how many people were in each group. Something similar happened in 2019 and 2020. My personal opinion is it was done at that time to maximize EBITDA prior to Welsh's exit. I think everyone whose shares weren't bought back during those years got them bought back when Welsh exited by exercising their tag a long rights. Nothing similar exists now and no idea how long it will be before this new group of physicians with stranded shares get them bought back.

 

[emergentmd]

So did the buy back price consistent with what you were told when you got shares?

I would be curious what values there are to these shares.

 

[WorkNoteEmergency]

I'm also curious if regular dividend payments are being made on those shares.

 

[EctopicFetus]

So I quit a month or so ago. As usual the board of directors had their quarterly meeting in mid May and had to approve buy back of shares from each departing physician. My shares were bought back in the last few weeks. What wasn't so typical was the rumor mill. Rumor has it that a few dozen departing physicians, who had been there for years, were told their shares would not be bought back"for now". Not sure why some people were redeemed and others weren't. Not sure how many people were in each group. Something similar happened in 2019 and 2020. My personal opinion is it was done at that time to maximize EBITDA prior to Welsh's exit. I think everyone whose shares weren't bought back during those years got them bought back when Welsh exited by exercising their tag a long rights. Nothing similar exists now and no idea how long it will be before this new group of physicians with stranded shares get them bought back.

Details on how much your shares got back for and what did you buy them at or what were they worth when granted to you. USACS is totally in $$ trouble. Same for team. App too. The house of cards is falling.

 

[USACSburner5]

Details on how much your shares got back for and what did you buy them at or what were they worth when granted to you. USACS is totally in $$ trouble. Same for team. App too. The house of cards is falling.

So I had $75k originally at either $1/share or $1.5/share, have to go back and check. Share price has since gone up a few times to $2.15/share Every time they had a liquidity and investment opportunity(LIO), basically a chance for employees to buy or sell shares, I would sell back down to the $75k they said I had to keep if I wanted to stay working there. When I finally left I had $75k at the most recent price of $2.15/share. Better than a poke in the eye but really pretty small potatoes compared to the $120k signing bonuses with a 2 year contract they are advertising now. $75k over the 5 years it takes you to get fully vested works out to something like $10/hr. $120k over 2 years is $40/hr

Certainly glad I didn't buy extra shares although the "value" would have gone up a good bit between $1.50/share and now. Some of my friends bought quite a bit. If I was in that group whose shares didn't get bought back on departure all that increase in value wouldn't have done me any good and I probably would be pretty pissed.

Have to admit I'm curious to see how this all turns out when the debt to Apollo comes due. Relieved I won't be around to find out.

I'm also curious if regular dividend payments are being made on those shares.

I think the last dividend payment was at least a year or two ago and was 10%. I think there were only 2 or 3 dividend payments during my time with USACS which goes back almost to the beginning. They were not on any sort of regular pattern I could perceive. Typically they would just get announced. Seems like they often got announced right before an LIO.

 

[USACSburner5]

I would sell back down to the $75k they said I had to keep if I wanted to stay working there.

Oh, yeah, turns out I have at least two co-workers who recently told me they refused the shares in the last year or two. Didn't want to deal with the taxes and didn't think they would be around long enough to vest. They are still working there. So, I guess you don't actually have to take the shares to stay there.

 

[emergentmd]

Certainly glad I didn't buy extra shares although the "value" would have gone up a good bit between $1.50/share and now. Some of my friends bought quite a bit. If I was in that group whose shares didn't get bought back on departure all that increase in value wouldn't have done me any good and I probably would be pretty pissed.

Assuming 1.5/sh and you sold at 2.15/sh over 5 yrs, thats a 43% increase. I would say decent but not any better than standard market appreciation.

So how did they pick who got their shares bought back? Was this some standard known guideline or just some random event.

 

[USACSburner5]

Assuming 1.5/sh and you sold at 2.15/sh over 5 yrs, thats a 43% increase. I would say decent but not any better than standard market appreciation.

Yep, just about exactly what the Russell 3000 did in the last 5 years.

So how did they pick who got their shares bought back? Was this some standard known guideline or just some random event.

I have no freaking clue. Maybe whoever rocked the boat the most, or the least, or I have no idea.

 

[emergentmd]

Yep, just about exactly what the Russell 3000 did in the last 5 years.

I have no freaking clue. Maybe whoever rocked the boat the most, or the least, or I have no idea.

Well, if some got paid out and others did not, then the shares are not a good investment. If it doesn't beat the Russell, then you essentially had an illiquid asset with the hopes of being paid out.

Also, I am sure they have some strict criteria for payout. Arbitrary payouts seems quite illegal.

 

[USACSburner5]

Well, if some got paid out and others did not, then the shares are not a good investment. If it doesn't beat the Russell, then you essentially had an illiquid asset with the hopes of being paid out.

Yep

Also, I am sure they have some strict criteria for payout. Arbitrary payouts seems quite illegal.

One would hope...

 

[ScepticSkeksis]

Definitely a bad investment in the current environment. They force you to pay the income tax up front on the value of the shares. If the company tanks and goes into Chapter 11, then likely the "shares" will be written down in value or lost forever.

 

[EctopicFetus]

Keep in mind if they gifted you 75k and let’s say you paid 25% on that marginal dollar your actual value you gained is roughly 60k we can round up to see. The gain isn’t really 43%. They actually gave you 75k less taxes and when you sell you also have long term capital gains. Keep in mind when their return equals the stock market you are truly losing cause as emergent pointed out this is an illiquid asset. You should expect better returns than the very liquid stock market in that manner.

I looked at this before and they performed equal to the large mutual funds and ETFs in healthcare. This is what is termed uncompensated risk (return). I locked up some money in an investment last year and I expect 18%-20% returns. Note for those who read while KKR got smoked with Envision the fund that owned envision still returned about 20% annually.

Also, I agree that USACS has to have some formula on how they redeem their shares.

If USACS didnt want to screw you they could offer options/warrants which are more tax beneficial to the owner of the Options. They choose to do this so they can lock in docs to the USACS nonsense. Agree the bonuses are much better but the sites are all trash.

 

[JacobMcCandles]

Note for those who read while KKR got smoked with Envision the fund that owned envision still returned about 20% annually.

I think I asked in another thread but do you have a link for this? You had said the $10B was written off and they still returned 20% annualized. Just curious where those numbers came from because it looked like it closed as a $14B fund in 2017. $10B would be a large portion of that. I can’t find the information.

 

[USACSburner5]

Just heard from a friend. He joined USACS around the same time I did. Left at least a month before I did. Probably had about the same number of minimum shares I did. He did not get his shares bought back. He's pretty pissed about it. Neither one of us have any idea why he would have been treated differently than I was.

 

[hundreddaysoff]

Just heard from a friend. He joined USACS around the same time I did. Left at least a month before I did. Probably had about the same number of minimum shares I did. He did not get his shares bought back. He's pretty pissed about it. Neither one of us have any idea why he would have been treated differently than I was.

I have a similar anecdote. Acquaintance left a USACS shop after being there for several years; never got shares back. I quit around the same time as him, after just 25% vesting or whatever they call it, and got my shares presumably after the next quarterly meeting. (Despite talking poorly about USACS in multiple threads on this forum. Guess I'm still anonymous to them...)

In the official docs we got during the VEP merger, it did mention that USACS is not obliged to buy back shares, although IIRC it was worded like they always try to make an honest attempt.

Shady nonsense!

 

[USACSburner5]

I have a similar anecdote. Acquaintance left a USACS shop after being there for several years; never got shares back...

Shady nonsense!

Pretty ****ty way to treat people

 

[Arcan57]

This meshes with my general gestalt of many of the USACS physician leaders even currently. Unlike PE, they are not intentionally evil; many of them really do still work a few shifts a month at their local shops, and I'm sure they are excellent clinicians for the most part. I suspect at least one used to be a regular on this forum, and I benefited greatly from their posts when I was a med stud.

Many of the ones I've talked to seem like true believers in The Power Of Cheese #Ownit. Some were formerly big in the academic cathedral system, and it was an easy transition to the corporate cathedral because they are real good talkers. The system happened to "work" for them and they ascended and achieved their personal dreams. But they never thought too hard about what it would really take to run an ethical medical business that can make a profit. And they do not necessarily see how badly they are screwing over their soldiers and associates (to use a Mafia metaphor).

Now they believe they have The Power To Change Stuff And Fight Big Business In Medicine (TM). But one cannot use the methods of evil to fight evil. And what this excellent thread has taught me is that, despite their earnest denial, they are really all just puppets of PE. (Many of them will be highly paid puppets in 5 years of course...)

Either that, or they really are PE-level evil and they're just much better at deception than I can imagine. Like, Littlefinger-level good at deception.

It's impossible to convince someone of something if their paycheck depends on their disbelief. Try talking to an interventional cardiologist in the 90s about the lack of utility of stenting asymptomatic lesions or an orthopod specializing in knee arthroscopy in OA patients. Same principle.

 

[emergentmd]

I don't want to say "we told you so" because this was well documented in past old threads. To the young docs who are thinking about USACS or some other "physician" owned CMGs who wants to give out equity for lower wages, You have been warned.

Its a scam, a pyramid scheme created to be complex so most docs just say give up understanding. Giving stocks with an unknown value, unknown vesting, unknown guaranteed time frame puts all the power back to the seller.