Physician Asset Protection

Physician Asset Protection

By: Martin M. Shenkman, CPA, MBA, JD

Medical malpractice risks and issues are becoming more and more frequent. The costs of malpractice coverage and the risks involved have caused many physicians to stop practicing. There are steps you can take to protect your assets.

  • Misconceptions about Asset Protection:
    • Do not move all of your assets under your spouse’s name. There are ways other than malpractice claims to lose all of your assets.
    • Once a suit has been initiated, you cannot move your assets.
    • Physicians often think that no one can get more out of them than the policy limits of the malpractice insurance policy. This is not true.
  • What you can do to protect your assets:
    • Make a comprehensive estate, tax, financial, and asset protection plan.
    • Look at making irrevocable transfers into LLCs, FLPs, and trusts. Make a comprehensive plan of entities to protect your assets. But they must all be logical, not just made to protect assets, or they will be deemed fraudulent conveyances. Sit with your financial planner before an asset protection planner and set up financial projections that will show what you can and cannot do.
    • A home is the largest asset that most people own. There are several ways to protect it from malpractice claims:

Tenants by the Entirety- Means that the husband and wife own it jointly, so claims against one spouse cannot touch the house Qualified Personal Resident Trusts (QPRT). Creating a QPRT means that a trust owns your house, but you can live there for the term of the trust. (Could be up to 20 years!). Afterwards, the house goes to your children.

The above is a summary of a radio show on MMFN Money Matters Financial Network, on June 30, 2008 with host Gary Goldberg, of Gary Goldberg Planning Services, Inc. in Montebello, New York, and his guest Martin M. Shenkman, Esq. an estate planner in Paramus, New Jersey. Listen to the audio clip of this segment on


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