Hygienist Steals Patients, Leaves Dentist with Huge Legal Bills

A Dentist’s Patient List Is Not Protected, Rules Michigan Judge
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“Any dentist who’s considering purchasing a practice needs to know what happened to me,” said Dr. Michigan. “My story has global ramifications.”

I could hear an edge of exhaustion in the doctor’s voice. Working seven days a week at two practices is clearly taking a toll. Though he’s been practicing dentistry for over 30 years, this is the only way he’s able to make ends meet.

It wasn’t supposed to work out this way. Dr. Michigan had a solid plan. The practice he purchased was supposed to help pave the way for his eventual retirement. Instead, he got ripped off, and is now looking at close to $100,000 in legal bills.

He decided to purchase an established dental practice that was producing close to a million dollars annually. He wanted to protect the 1,000 or so names on the practice’s patient list, so he had the previous dentist sign a standard non-competition agreement.

“Everyone tells you to have a non-competition clause with the dentist. No one had ever brought up the issue of staff, particularly hygienists,” he sighed.

Along with the practice and patient list, Dr. Michigan also inherited several staff members. His relationship with Hygienist X seemed fine at first. He didn’t mind when she picked up extra hygiene hours at another dental office. Even after she left to work full-time for the other dentist, he wasn’t aware of any problems.

Dr. Michigan knew that production had slowed at his newly-purchased practice, but he didn’t know why until he received a few anonymous phone tips from former employees of the practice where Hygienist X now worked. They had shocking news for Dr. Michigan.

While Hygienist X was still working at both practices, she stole Dr. Michigan’s patient list and brought it over to the other practice, and apparently proceeded to solicit away Dr. Michigan’s patients to the other practice.  She even had the audacity to solicit a patient she was treating in Dr. Michigan’s office! This certainly explained the sharp drop in production he had suffered. He estimates she solicited away nearly 150 patients, costing him over a projected $1,000,000 in lost revenue over a five-year period, according to his consultant.

So Dr. Michigan immediately called his lawyer and started a lawsuit.

You’d think it would be a slam-dunk. In court, Hygienist X point-blank admitted under oath that she had taken Dr. Michigan’s patient list.

Here’s the unbelievable part: the judge threw the case out, ruling that the patient list was not covered under the Michigan Uniform Trade Secrets Act. The judge was in effect saying that a doctor’s patient list is not protected information. (In a similar Pennsylvania case, the patient list was found to be a trade secret, but that’s of little help to Dr. Michigan.)

So Dr. Michigan now finds himself working two jobs just to pay his legal bills. And, as you might expect, he is unhappy. “I wish I could offer you more than just sympathy,” I told him, feeling helpless.

“You can share my story with other dentists,” said Dr. Michigan. “Anyone who’s buying a practice should work out terms with the staff, particularly anyone who has access to the computer, right off the bat. I’d recommend having every staff member sign a strongly worded confidentiality agreement, whether they stay or not.”

A Side Note on the Joys of Insurance

Dr. Michigan’s insurance company would not reimburse him for any of his losses. His Employee Theft and Dishonesty Policy would have given him a payout of up to $20,000 if Hygienist X had stolen equipment or furniture. But his patient list? Sorry, not covered!

But it was a different story for the other dentist in the story. While Dr. Michigan spent a year’s worth of his hard-earned money on legal expenses, the offending dentist’s insurance company paid the bulk of his legal costs.

Taking over an existing practice can leave a dentist exceptionally vulnerable. Patients who have known the hygiene staff for years are suddenly faced with a new doctor. The previous dentist often helps introduce the new dentist to the community, but the hygienists generally have closer personal relationships with patients.

I’ve heard stories of hygienists who leave after a new dentist purchases their practice, only to take out a big ad in the local newspaper announcing that the hygienist will now be seeing patients at another dental office just down the block.

But taking the patient list with you?!? That is shocking, appalling, and blatantly unethical theft. I’m frankly frightened by the possible ramifications of this Michigan ruling.

I would have expected a patient list to be covered by both the Trade Secrets Act and by the Health Insurance Portability and Accountability Act (HIPAA). But apparently not! And patients… Beware too!

Dentists: I want to know what you think of Dr. Michigan’s story! Post your comments below. Plus, contact me if you’d like to get in touch with Dr. Michigan.

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