June 29, 2013

When doctors divorce, the breakup can be as messy as a marital split

Medical practices break up more often than patients realize, experts say, and breakups appear to be on the rise as doctors face increasing financial pressures. The split between Dan Hancock and Daniel Kloster of Rockhill Pain Specialists has been particularly filled with acrimony and melodrama.

It sounds like the lead-in to any of 101 divorces.

One partner is accused of outrageous misconduct, the other of not doing his share. There are threats, maybe shouting. The silent treatment. And underneath it all, a simmering dispute over money.

But in this case, it’s not a husband and wife battling it out.

It’s two Kansas City doctors, pain specialists who were partners in a practice that saw hundreds of patients until it folded a few months ago in the midst of court hearings and state investigations into allegations of malpractice.

Medical practices break up more often than patients realize, experts say, and breakups appear to be on the rise as doctors face increasing financial pressures. The breakups often have all the acrimony and melodrama of a messy marital divorce.

The split between Dan Hancock and Daniel Kloster of Rockhill Pain Specialists may be one of the messiest.

For 12 years, Hancock and Kloster built Rockhill into a lucrative business that stretched from Blue Springs to Overland Park. The two doctors and their wives and children socialized together. They regarded each other as brothers.

Then it all fell apart.

Beginning last summer, Hancock and his lawyer filed a series of complaints of poor patient care against Kloster with the hospitals where he works, with the medical licensing boards of Kansas and Missouri, even with the attorneys general and governors of the two states.

And in the letters to the attorneys general, Hancock pushed for action against Kloster, making the startling allegation that Kloster was practicing so far below the standard of care that two of his patients died through massive overdoses of pain medications.

Kloster insists the allegations are false and are financially motivated. He was bringing more than twice the revenue into their practice as Hancock, yet they were sharing it equally. Hancock didn’t file his complaints until Kloster started asking for a bigger share. In March, Kloster sued to dissolve their practice.

Both doctors have asked for a jury to settle their disputes. Meanwhile, a receiver is picking through the financial remains of Rockhill Pain Specialists.

“Allegations and accusations and ambivalences and conflict. It’s not unusual when two-partner practices dissolve,” said John-Henry Pfifferling, an anthropologist and director of the Center for Professional Well-Being in Durham, N.C., which helps doctors deal with stress, burnout and workplace issues.

As many as 3 out of 4 physician partnerships eventually break up, Pfifferling estimated.

“Certainly the old days of practicing together until retirement is not how it really is.”

Pfifferling refers to these dissolutions as “practice divorce,” and it’s not uncommon to hear professional partnerships among physicians discussed in marital terms.

John Fanburg, an attorney in New Jersey, calls medical practices “marriages without love.”

These marriages appear to be ending in divorce more often now, Fanburg said. There are more pressures on doctors, such as the uncertainty about the future of medicine brought on by the overhaul of the nation’s health care system and disappointing reimbursement rates from insurers and Medicare.

“When they go south, they can go very bad,” Fanburg said.

There’s a whole industry of management consultants, psychologists and lawyers providing medical practices with the health care equivalent of marriage and divorce counseling. They offer workshops on conflict resolution, individual and group sessions, and weekend retreats. And they negotiate settlements and dismantle practices that can’t be saved.

The saga of Hancock and Kloster goes to extremes, some of these experts said. But they have plenty of other stories about messy conflicts getting out of hand.

There were the two orthopedic surgeons who started shoving and pushing and eventually punched each other in the middle of surgery. And the doctor who surreptitiously changed the locks on the office doors. And the doctor who answered a call from his partner’s patient and then scheduled the patient as his own.

Patients may not notice that anything is going wrong at their doctor’s office; the medical profession makes an effort to keep the public from knowing such things. But if disputes boil over, patients may hear doctors yelling at their staff. Their doctor may become curt and not explain things well. Patients may not get immediate attention if their doctor is away and his or her partner refuses to take the other doctor’s calls.

Douglas Griest, an Atlanta-based psychologist who works with law firms, insurance companies and banks, said there are reasons breakups among doctors are much more like divorces than breakups among people in other businesses.

“They’re just so joined at the hip financially,” Griest said. “Their families may socialize, their kids may go to school together, their spouses may be friends. And they’re practicing medicine. They’re not running a business. That may sound strange, but that’s how it is.”

Poor communication, generational conflicts between junior and senior doctors, different practice philosophies –– whether or not to accept low-income Medicaid patients, for example –– can all destabilize a practice.

“The No. 1 thing that breaks up a real marriage and a practice marriage is money,” said Debra Phairas, a practice management consultant in San Francisco.

Often, one doctor will be outperforming the rest and feel he should be better paid. Resentment builds and the doctor seethes, then finally blows up.

Phairas recalled one such case.

“He went crazy,” she said.

Phairas tried working with him to come up with a more equitable compensation formula.

“It was too late. It had been too many years.”

Doctors are often unprepared either by training or personality for these conflicts.

“Most doctors haven’t worked in anything other than medicine, so they have no experience in business,” Phairas said. “They go straight through school. They are really in the hole about knowing about anything else –– human resources, finances.”

When conflicts develop, doctors can be slow to compromise, said Griest.

“They’re bright, strong-willed personalities with an ego,” he said. “They are trained to be the person with the answer. That doesn’t work in personal or business relationships. Everybody has a piece of the pie.”

Birth of a practice

There are some points on which Hancock and Kloster agree.

They met at the University of Kansas Medical Center back in the mid-1990s while Hancock was a staff anesthesiologist and Kloster was a resident training in anesthesiology. After Kloster returned to Kansas City from a fellowship at Massachusetts General Hospital, he and Hancock joined an existing group practice and then started their own.

And so in 2001, Rockhill Pain Specialists was born.

For a decade, the relationship went smoothly. Kloster, who lives in Fairway, saw patients mostly at Research Medical Center and Menorah Medical Center. Hancock, who lives in Independence, focused on Centerpoint Medical Center and St. Mary’s Medical Center in Blue Springs.

The two doctors shared equally the money they made. That included the revenues from patients as well as from work for medical device companies.

“Whether it’s sad or a punch line, we were best of friends,” a rueful Kloster said. “We were like brothers.”

“This is a guy I considered to be my brother,” Hancock affirmed grimly.

Then around the beginning of last year there was a rupture, and the stories of the two doctors diverge.

Hancock said he began to see a change in Kloster’s demeanor several years ago. Kloster seemed disengaged from the practice, he said. Conversations with Kloster became abrupt and abrasive.

“There wasn’t the cordiality there was before,” Hancock said. “He didn’t want to know anything about the business. He wanted to see as many patients as he could in a day.”

Kloster took on more and more patients with severe cancer pain, according to Hancock. And Kloster started implanting increasing numbers of pain pumps in the patients, he said.

These pumps, placed under the skin of the patient’s abdomen, hold a reservoir of pain medications and deliver measured doses of the drugs through a catheter directly to the area around the spinal cord. They offer more effective pain relief than oral or intravenous medications without many of the side effects.

The letters to the medical boards said that Hancock was responsible for reviewing the records of Rockhill patients who had died and that he started seeing a pattern among patients given a pain pump by Kloster.

Because pumps are expensive, Medicare limits their use for cancer patients expected to live at least three months. Many of Kloster’s patients were dying within weeks or days of receiving a pump, the letters said.

Hancock said in an interview that he started warning Kloster about the issue as early as 2009 and repeatedly after that, well into 2011.

He said he told Kloster that fines from a Medicare audit could bankrupt the practice.

Kloster denies hearing anything from Hancock about the subject until mid-2012 during a meeting of the two doctors with their lawyers. About an hour into the discussion, Hancock said there was an issue with Kloster’s use of pain pumps and there needed to be an audit.

On the rocks

By this time, the doctors’ relationship was disintegrating.

In 2011, Kloster had received an offer from a pharmacy company to become its national medical director. He didn’t consider this part of his work for Rockhill Pain Specialists and didn’t want to share his earnings from it with Hancock.

Hancock was “absolutely livid,” insisting on a 50-50 share, Kloster said.

Kloster wanted to look at the practice’s financial records, something he had never done before.

What he saw surprised him.

“I was doing more than double what he was for years,” Kloster said.

Kloster said he wanted a new compensation formula, but a meeting in early 2012 at the Bristol restaurant ended in shouts and threats. Hancock acknowledged the meeting but said there was no shouting.

Soon afterward, Hancock went through a lawyer to hire an expert to review some of Kloster’s pain pump cases. He sent her records of 12 patients who in all but one case had died less than 90 days after receiving a pump.

Andrea Trescot, a prominent pain specialist, reported back, raising issues about the medications that Kloster used.

“I am seriously concerned that the medicines that Dr. Kloster chose for the pump hastened if not caused these patients’ deaths,” Trescot wrote.

Kloster categorically denies the Trescot allegations. According to his lawsuit, “Dr. Hancock is engaged in a malicious campaign intended to inflict damage to Dr. Kloster’s professional reputation.”

Trescot declined The Star’s request for an interview.

Hancock provided The Star with the records of some of the patients reviewed by Trescot. Patient names and other identifying information had been removed.

A pain specialist who reviewed the records at The Star’s request said the records supplied were incomplete, making it impossible to evaluate the care Kloster provided.

Within days of receiving Trescot’s report, Hancock’s lawyer passed it on to the Kansas and Missouri medical licensing boards, along with letters outlining Hancock’s concerns.

Hancock provided the report and wrote a lengthy letter to senior administrators and medical staff at Research Medical Center and Menorah Medical Center alleging patient safety violations by Kloster.

Meanwhile, Kloster and Hancock decided to end the practice and tie up the loose ends by the end of February 2013. But when that date passed without resolution, Kloster sued. In March, the court ordered the appointment of a receiver to oversee Rockhill’s finances.

Hancock said he and Kloster have not spoken to each other for the past 12 months.

“Dr. Kloster could be a very good doctor,” he said. “But he is not the man I joined forces with 12 years ago.”

Basically, Hancock said, “he is a greedy bastard.”

Kloster said in his lawsuit that both hospitals where he practices have exonerated him of Hancock’s allegations. So far, the doctors say, there has been no decision by the state medical boards, where complaints are kept confidential.

Kloster is adamant that he did not hasten patients’ deaths, that the pain pumps brought them a better quality of life in their final days.

And pain pumps aren’t a big moneymaker, Kloster said. In the time it takes to earn $400 implanting a pump, he could make considerably more doing office procedures.

“You absolutely don’t get rich doing pumps. You do them because they’re the right thing to do.”

Kloster questioned why his former friend stuck around so long with him, sharing the money from pain pumps, if he had so many qualms about how he was treating patients.

“If I’m killing people, why would you be my partner?” Kloster asked. “He was very comfortable taking money for this.”

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