Starting a Law Firm, Moving to a New State

Starting a law firm can be tough. Trying to build your new law firm can be even tougher. Starting a law practice completely from scratch in a new jurisdiction could be fatal.

Many times, people starting their own law firm will leave an old firm with a bevy of client who they had represented under the old firm’s moniker. This is a perfectly acceptable way to start a new law practice. It is done many times and it will continue to be done. Think about it – if you already have a client base (or “book of business”) intact, you don’t need to worry so much about marketing and client development. Your only real worries initially are setting up a new corporate structure, a new office and the vagaries that go with that, malpractice insurance, and general institutional kind of work. Don’t get me wrong, that isn’t easy, but it appears much more doable when you know you have clients who are going to pay for those things.

However, moving to a brand new state with no clients AND trying to start your own law firm, is a whole different ball game. Not only do you have to worry about the institutional kinds of things every lawyer starting a law firm has to worry about, you also need to worry about how you are going to pay for this stuff while you build a client base. The very idea of it would discourage even the most ambitious man.

This article is not meant to discourage, though, it is meant to enlighten. When moving to a new state to start a law firm, you, of course, must be licensed in that particular jurisdiction first. Once you are licensed, the game is essentially on. The name of the game is marketing – something nobody teaches you in law school. (As an aside, this is where a joint MBA/JD degree would really come in handy).

So, how do you market your new law firm when you are moving to a new state? Simple, you get out there and hustle-n-flow. Another name for it is “networking”. In order to be successful in any business, let alone starting a law firm, you have to network and create a network. After all, starting a law firm is all about people and connections. Your clients connect with you. You connect with the court and court staff, including the judge or jury. Your business colleagues connect with you. How do you connect, again, get out there with your name and do good work. Be organic. Plant a seed and make it grow. Sound tough? It is.

It takes time and effort and failure. One of the hardest things an entrepreneur is faced with is failure. But, failure can be a good thing if you make it work for you instead of against you. An entrepreneur learns from failure and turns it into a positive. Life is about experiencing, learning, and failing – and then getting back up again.

So, if you think you have it in you to accept failure and keep on truckin’, you may be ready to move to a state and start and build a law firm.

Medical Records Retrieval for Law Firms

• MODERN MEDICAL RECORDS RETRIEVAL SERVICE – AUTOMATION, COMPLIANCE, SAVINGS

The modern Medical Records Retrieval (MRR) service is a combination of modern web-based technology and a rules-compliant outsource solution. Historically lawyers and their staff would have to set aside a portion of their time, often a lot of time, to capture necessary information for cases that involved medical records. It’s not that the process is complex. Quite the contrary, every attorney, paralegal, and litigation-support person knows exactly what needs to be done.

It may appear simple, but it is a very manually intensive process. Someone at the firm must acknowledge the need for the records. Necessary forms must be completed to ensure compliance with a myriad of laws (including HIPAA), which the firm and often the patient (who may or may not be the firm’s client) would need to initiate a request. Then, the firm must track the progress of the request, and eventually receive, review, and organize the results, or note that there were no medical records available related to the matter.

To support the business of running a law practice, sophisticated and affordable software tools include new client/business intake, workflow automation, and conflicts management. Vendors who provide early case assessment tools and e-discovery-based technology-assisted review have begun to offer solutions for small firm and solo practitioners. In this article, we will show you how you can improve productivity, lower costs, and better manage billing for MRR expenses.

How Medical Records Retrieval Services Work

Here’s how a typical MRR service works for a small firm/solo practice. One of the firm’s employees logs into a secure, encrypted website. He or she then submits an order outlining the patient’s information, the records being requested, and any other data necessary to complete the request. What happens next is truly a game-changing activity. Instead of the firm’s billable resources chasing record requests from hospitals, doctors, and other healthcare providers, they go back to doing other, productive work, while the MRR process self-executes, and eventually provides you with the requested information and documents or informs you that there were no responsive documents.

Questions Regarding MRR Services

The availability of MRR services presents all attorneys, but especially solo and small firms, with the following important questions:

• How do you start with an MRR service?

• How are the record requests processed?

• Is this process HIPAA-compliant?

• When and how am I alerted to the status of my requests?

• How do I distribute the costs/fees associated with outsourcing medical records retrieval?

Choosing Your MRR Provider

To reduce the risk of choosing the wrong MRR service, consider the following best practices:

1) Ensure that the MRR service can prove secure access to its website (and your records) via a login and password.

2) Understand the MRR service’s processes to ensure protection of privacy.

3) Understand its service level agreements, which explain their process and anticipated turnaround time.

4) Verify that the MRR service has experience with expediting record requests by requesting a list of reference clients.

5) Review the process by which you and/or your staff are notified of updates, including record availability or notice of “no record found.”

6) Ask for the MRR service’s price schedule, preferably in a format that will permit you to do an apples-to-apples comparison of the fees of other MRR services.

When possible, a dedicated MRR service is a better choice than a firm that offers a multitude of legal practice services of which records retrieval is only a small subset of their overall business.

Getting Started with the MRR Provider

Upon choosing your MRR provider, the steps to starting to work with the provider are straightforward and similar to those when signing up with any on-line type of service:

• The firm identifies the approved personnel who are authorized to access the secure system.

• A unique user ID is created for the firm at this time, with a strong password required for all future access.

• Often, this is also the time that billing information is provided, and thus a financial account with the firm and MRR is created for future invoicing.

• Each authorized person completes a new user profile and sign-on request. The user must provide email and phone contact information.

• It is the responsibility of the law firm to notify the MRR as soon as possible in the event that an existing authorized user should be removed from the access control. The MRR should remedy and respond as soon as the user access has been removed.

• While the use of the MRR site should be quite easy for most users with minimal training, additional site support generally is available from the MRR’s services personnel via phone or email request.

Safeguarding Privacy

No matter how beneficial the technology, the firm must ensure compliance of federal and state HIPAA guidelines and any ethical rules about maintaining client confidences. Therefore, they must ensure that the MRR service collects, hosts, and provides access to client(s) records while maintaining compliance with privacy guidelines. Note: This should be part of your due diligence when selecting a provider.

The MRR Service should comply with Federal and state privacy laws. MRR services should keep up to date with changing rules of privacy such as the HITECH Act.

MRR agreements should expressly state that no personally identifiable health information (PHI) can ever be used for non-business related activities such as marketing and/or sales lead generation.

Record Processing

Once you have chosen an MRR service and set up your account, obtaining medical records is relatively straight-forward:

• After you enter a request into the system, the MRR service creates an MRR record request connected to the unique ID of the requester (the specific user at your firm), and confirms receipt of the request via an email.

• A reviewer is assigned to assess the necessary actions to fulfill the request, and will notify the user of any questions regarding the record request. In some states, including California, an electronic request can be executed from the MRR service to the healthcare provider, eliminating the need for paper-based transaction.

• The provider then tracks the request, and conducts any follow-up communication by any means available, including email, telephone or in-person visits if necessary, to acquire clear copies of records requested.

• If the record is available and legible, it is scanned into the secure web-based system for access by the user. Otherwise, a “no record found” is annotated to the request, and communicated back to the user.

Communication Is Key

Nothing can be more frustrating to case management than waiting for needed information from a third party. The MRR service must not only forward the record request to the healthcare provider, but also must provide the firm an ongoing and timely response regarding status. Each record must be tracked in real-time with detailed notes from the MRR agents. The MRR service should send alerts if additional information is required, provide replies via email, and deliver the link to download and/or view completed requests as soon as the records become available. Again, during the selection process, you should ascertain the provider’s practices regarding communications, and include them in the contract.

Speed Is Critical Too

Obtaining the medical records timely is critical, whether to respond to discovery, to make or oppose a motion for summary judgment, to get an expert up to speed, or to settle a case. A reliable MRR service will offer a quick turnaround. They have the experience working with medical locations to obtain records faster than a law firm’s in-house staff. After all, a law firm staff member may encounter (or, in truth, may feel like they have gotten stuck with) the occasional medical record search, but the MRR service is a specialist in the process of collecting information, including “no records found.” So, the MRR service’s very job is obtaining medical records, and therefore will have the process down to a set of specific steps, and can support their clients via a web interface.

Relationships With Healthcare Providers

Sometimes hospitals, physicians’ offices, and other healthcare providers may treat the occasional request by an attorney for medical records as an inconvenience, not respond as quickly or perhaps as completely as the attorney or client would like. A smart MRR service will develop long-term relationships with healthcare providers and their staff to get the data needed promptly and efficiently. This will improve the quality of the document production, reduce its cost, and speed the process up.

Database Strength

Medical records often can be in a different location or city than the healthcare provider. For example, billing records for hospitals are usually in an offsite facility, sometimes in another state. With the advent of electronic records, more healthcare providers are centralizing their records offsite with the umbrella company of their medical group/hospital. Without the information on how and where to request records, in-house staff can waste valuable time sending requests to the wrong locations or having to spend the time to find out where to send the requests. A strong database on where and how to request records from healthcare providers therefore is key to save time, ensure complete result, and save money. MRR services have the incentive and the resources to develop such a database. Law firms, especially solos and small firms, do not.

In addition the importance on the database in requesting medical records, it is equally important on the production side. Virtually all medical records are produced in digital format. Records are typically available in PDF or TIFF file format, making them searchable by many document management systems – including on premise, cloud-based, web-based or hybrid systems. They are usually made available for download and/or viewing from virtually anywhere on any device that supports a secure micro-browser. The MRR service maintains the medical records for ongoing access by the user and any authorized personnel.

MRR Costs and other Considerations

The MRR service will charge you for their services. However, because the firm’s resources are freed up to work on activities that generate revenue for the firm, the costs of using an MRR service will be offset at least in part, and perhaps in full. In addition, depending on your fee arrangement with your client, the invoices from the MRR service may be directly billable back to the client or at least accounted for as a recoverable cost. (Many MRR services charge no monthly fees for having an account, and thus the firm only incur fees on a usage basis, which can then be charged to the cases for which they are required.)

Summary

While many firms may continue the “do-it-yourself” approach, solos and small firms should consider using an MRR service. In addition to the higher costs of installing and maintaining one’s own record management system, the soft costs and resource consumption make this a less favorable alternative. A qualified, experienced MRR service offers a cost effective, robust platform for processing, monitoring, and tracking medical records requests. Record management and processing is HIPAA-compliant, always available, and secure-which in-house processes may not be, with the attendant risks. Use of an MRR service does not require capital expense to leverage digitally filed and maintained medical records. Firm resources can be repurposed from tracking record requests to meaningful and fee-generating activities. Client satisfaction may improve as matters are able to be processed more efficiently, and firm business may increase. The results of using an MRR service are measureable and immediate. It’s literally a one-click quantum leap from manual, resource-heavy processes to a modern, digital, secure web based management for your practice.

Law Firm Collections – The 10 Biggest Mistakes In Managing Their Accounts Receivable

The demands of an ever-growing legal profession require law firms to have forward-thinking management strategies to address clients’ needs. Although lawyers’ main priority is – and must be – to deliver quality service, law firms must also build their organizations to support their clients’ evolving demands, by taking steps such as opening international offices, embracing new technologies, and developing new areas of practice.

As a result of this growth, law firms will face high overhead and growing compensation demands from their professionals. Meanwhile, firms will be squeezed from the other side by clients who have high expectations yet, at the same time, scrutinize their bills.

During the course of a year, many firms find it difficult to judge how well their collection efforts are faring and how this could impact their financial pictures. Lawyers have been conditioned to take a relaxed attitude in their collection efforts, largely due to a mindset among attorneys that grants clients the benefit of the doubt and a view among clients that making payments is not a priority. Attorneys also fail to realize that clients will take advantage of their professional relationship. Thus begins a vicious cycle. Lawyers are not vigilant in getting their clients to pay and the clients, as a result, are not quick to pay. The lawyers, then, are reluctant to press their clients. And so on.

The business of buying legal services does not lend itself to such strict purchase and payment rules.

It often involves complicated transactions, equally complex business relationships, and disputed resolutions that require many hours of work at high billing rates, resulting in high bills to clients. Stopping work because a client does not pay is sometimes not an option because of ethical obligations.

The reality is that problems with collections within the legal profession are not a financial management

issue. It’s all about effective practice management, which requires attorneys and law firms to manage

their accounts receivable proactively. However good the firm’s financial staff may be, attorneys are ultimately responsible for the success – or failure – of collection efforts because they who steer the relationships with clients.

When it comes to receivables, law firms fall victim to 10 common mistakes:

1. Attorneys believe that aging receivables are not an indicator that collection problems exist. Actually, if bills have not been paid within 90 days, you have received the first sign that you may have a collection problem – and, if it is not resolved quickly, they could age further and be virtually uncollectible. Only 50 percent of receivables over 120 days will be collected, and the likelihood drops precipitously after that.

Clients reason that if the firm has waited several months to try to collect unpaid bills, they can wait to pay those bills. They assume, and with good reason, that they are in better position to negotiate discounts. The longer a law firm waits to collect unpaid bills, savvy clients realize, the more likely the bills will end up being discounted or written off altogether.

2. Law firms fear they will damage client relationships by asking clients to pay their bills. The fact is that law firms lose clients by doing poor work or by failing to deliver client service, not by asking clients to pay their bills. Efforts to manage receivables will not hurt the relationship, as long as it is done professionally. Actually, most clients are perfectly willing to pay their bills, although many are dealing with cash flow problems. Also, clients fall victim to “sticker shock,” which happens when a client expects to receive a bill of a certain size and gets a rude awakening when larger invoices arrive.

3. Lawyers avoid addressing problems by depending on the mail to communicate with delinquent clients.

Postal mail is slower and far less effective than using the telephone to address delinquency issues. A conversation allows you to have a dialogue about the bill. Besides, letters and reminder statements are easily misplaced and avoided. If the client continues to receive reminder statements after 60 days and still does not pay, chances are there is an issue preventing payment. Even a brief, non-confrontational telephone conversation should communicate to the client the urgency of your need for payment and allow you to learn quickly if there are any problems or concerns – and what it will take to get the bill paid.

4. Firms believe that accounting and collection software will cure all that ails them. Software can be an excellent tool to manage receivables, but it is only as good as the people using it. Many law

firms have developed policies and procedures to better manage their accounts receivable, but many have not properly utilized their software to help implement new systems. It takes time and specialization to fully grasp how the software can help a firm’s collection efforts. Law firm staffs are often responsible for many day-to-day tasks that leave them little time to explore and make maximum use of the functions that software offers.

5. Firms embrace alternative payment arrangements too quickly. Complex transactions may not lend themselves to a regular payment schedule, and they may cause confusion as to appropriate payment if the deal does not come to fruition. Furthermore, risky deals sometimes fail, leaving a trail of unpaid receivables.

6. Lawyers fail to recognize the point at which they should stop doing work rather than continuing to

amass unpaid bills. Sometimes lawyers become so wrapped up in their work that they do not pay

sufficient attention to bills that are not getting paid. By the time they realize clients are not paying, they have put in plenty of additional time. Someone – and perhaps the attorney is not the right person – should be monitoring payment so work does not far out-pace payment.

7. Accounts receivable management reports are not providing the right information to measure progress. Accounting departments are churning out a lot of reports concerning receivables. But are these reports answering the key questions that will allow the firm to maximize its collections? Why is the client delinquent? Is delinquency habitual for this client? What can the firm do to facilitate payment, both in the short and long terms?

8. Law firms are not analyzing the right reports to manage accounts receivable. Most firms still use

generic financial reports that have too much extraneous information to target problem offenders. Instead, firms need to generate more useful information. For instance, firms need to know if an account is being actively pursued and what the payment status is. They need to know who is pursuing the collection efforts (the attorney or the collection staff) and whether they are getting results. They need to categorize their accounts in order to know the reasons clients are not paying, such as cash flow problems, disputed fees and

services, or third-party responsibility. They need to know where the problem accounts are in order to determine a plan of action to get the bills paid.

9. Law firms are not spending enough time focusing on older, aging receivables. As a result of the growing legal profession, most firms continue to bring in new business while maintaining strong realization and focusing on more current accounts receivable. Firm management may be so busy building the firm for the future that it is ignoring the reality that a lot of receivables are slipping through their hands. They do not fully realize that increasing collections with payments from aging receivables is a fast and effective way to put more money into the partners’ pockets.

10. Law firms are not making collection staff or departments accountable for producing results. Many law firms fail to evaluate their staffs’ performances in collecting aging receivables. The collection staff is, therefore, left with little guidance as to what its collection responsibilities should be – and this does not necessarily include addressing and pursuing older, more difficult accounts. Collection staffs often end up being responsible only for monitoring payment of ongoing clients, sending reminder statements, or providing accounts receivable reports to attorneys. Although these duties are important, they do not address the more fundamental issues concerning collecting for complicated transactions and for client relationships that require more individual attention.

Take the time to honestly evaluate your receivables collection and management efforts. By understanding – and overcoming – some basic mistakes, lawyers can become far more effective in managing their receivables.