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JUST WHAT THE DOCTOR ORDERED:JUST WHAT THE DOCTOR ORDERED:Introduction to Planning for – and Marketing to – Physicians”Introduction to Planning for – and Marketing to – Physicians”

Presented By:

Jeffrey R. Matsen, Attorney at LawMark Monasky, Attorney at Law, MD.

THE ADVISORS FORUMTHE ADVISORS FORUMSeptember 16, 2009 1:00pm ETSeptember 16, 2009 1:00pm ET

Founder and Partner-In-Charge of Wealth Strategies Counsel , the Estate Planning and Business Transaction Department of Bohm, Matsen, Kegel & Aguilera, LLP, of Costa Mesa, California

A Southern California “Super Lawyer” (Los Angeles Magazine), with a national reputation for emphasizing wealth preservation for his high net worth and professional, accomplishment-driven clientele

Nationally recognized CLE Speaker in the areas of asset protection and LLCs

Areas of emphasis include: International and Domestic Asset Protection, Estate Planning & Wealth Preservation, Real Estate Acquisitions & Development, Business Formation & Transactions, Probate, and Trust Administration

Certified Business Appraiser by the National Society of Appraiser Specialists

Member, Society of Trust & Estate Practitioners (“STEP”) Fellow, Center of International Legal Studies Professor, Chapman University School of Law & Western State

University College of Law, in Business & Estate Planning Visiting faculty member, European law schools Awarded highest rating (“AV”) for competency and ethics, as

published in the prestigious international Martindale-Hubbell attorney directory

Awarded highest rating (“10/10 Superb” )by The Nationally Renowned Attorney Rating Service, ‘AVVO’

Recognized as one of “O.C.’s Top Lawyers” by OC METRO Magazine

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Estate Planning attorney focusing on asset protection for physicians and dentists

Member of WealthCounsel

Graduate of University North Dakota School of Law

Board certified neurosurgeon by the American Board of Neurological Surgery

Selected Best Doctors in America, Central Region

Diplomat, National Board Medical Examiners

Graduate of Columbia University, College of Physicians & Surgeons New York City

Neurosurgery training at Mayo Clinic and University of Maryland

Pediatric neurosurgery fellowship University of Texas , Southwestern Medical School Dallas

Fellow American College of Surgeons

Fellow American College Legal Medicine

Member of American Bar Association, Real Property, Probate & Trust Section; American Medical Association, American Association of Neurological Surgeons, Congress of Neurological Surgeons, State Bar Association of North Dakota, North Dakota Medical Association

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Doctors Are Great Clients Doctors Are Great Clients

Top ten percent of US doctors control over $350 billion dollars in wealth

As of now, physicians’ business is recession proof

95% of MDs each earn over $250,000 per year

All doctors need Asset Protection and Estate Planning

There will always be doctors. There are somewhere between 700,000 and one million doctors in the US

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Why the Increased Liability Exposure?

Victim Oriented Society

Deep pocket

Plaintiff lawyers

Increased media and society awareness

High notoriety for malpractice and other errors and omissions type of action

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Doctor and dentist clients need to be aware of proper structure for practice

Professional corporations

Segregation of assets

Sub S election

Share holder agreements

Other practice structure items

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Understanding How Physicians Understanding How Physicians ThinkThink

Trusting and caring

Intelligent

Non Confrontational

Surgeons

Attitudes towards attorneys

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Know What Is Important to Know What Is Important to PhysiciansPhysicians

Asset Protection:

MDs have virtually no trust in the legal system

MDs have sacrificed heavily both financially and time wise and want to protect their wealth

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How To Obtain Physician How To Obtain Physician ClientsClients Use physicians’ personality traits and quirks to your

advantage

Accessibility

Saturdays, evenings, wherever and whenever the MD is available

Offer other services within your firm that are unique to physicians

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The Ladder of Success - Level One: The Business Entity

- Level Two: Basic Estate Planning - Level Three: Exemptions and

Marital Planning - Level Four: Liability Protected

Entities for Investment Assets - Level Five: Domestic Modular

Planning with Asset Protection Trust

- Level Six: Offshore Modular Planning with Asset Protection Trust - Level Seven: Advanced estate

Planning Techniques 

Reviewing and Implementing The Plan

Reviewing and Implementing The Plan

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Inside CreditorsInside Creditors

Definition: Inside creditors are those creditors

whose claim is directed against the business operation or real estate which is operated and owned inside a business entity.

Creditor

Business Opsor

Real Estateof

LLC or LP

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Protecting Against Inside Protecting Against Inside Debts or ClaimsDebts or Claims

Operating Businesses:

C Corporations

S Corporations

Limited Liability Companies

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Segregate Business AssetsSegregate Business Assets

Real estate should be held in LLC and leased to professional practice or business

Equipment can be held in LLC and leased to professional practice or business

Separate liability protected entity for different business or practice functions and operations

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Outside CreditorsOutside Creditors

Definition: Outside creditors are those creditors

whose claims arise outside the purview of the business entity and are generally asserted against the business or real estate owner personally.

CreditorLLC or LP Member/Partner

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Marital Property PlanningMarital Property Planning

Consider possibility of transmuting separate property or jointly held interest of professional spouse into separate property of non working spouse

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Marital Property PlanningMarital Property Planning

Quid pro quo

or fair market

consideration

is preferable

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Marital Property PlanningMarital Property Planning

Remember, what is good for the goose is good for the gander. What is good for asset protection planning will probably be good for divorce consequences.

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Placing Assets in LLCPlacing Assets in LLC

Provides protection against inside debts or claims against the assets within the LLC

Provides protection against personal liability because of the Charging Order

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What is a Charging Order?A charging order is more or less like a

garnishment of income in that it is an order of the court in favor of the creditor requiring that any distributions from the limited partnership or LLC to the debtor limited partner or member be made to the creditor who obtained the charging order.

Charging Orders and Charging Orders and ForeclosureForeclosure

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Advantages of Foreclosure to Creditor Sale of economic right;

Broad Charging Order

Forced dissolution

Disadvantages of Foreclosure to Creditor Tax liability for “Phantom Income”

Foreclosure of a Charging Foreclosure of a Charging OrderOrder

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DOMESTIC ASSET PROTECTION DOMESTIC ASSET PROTECTION TRUSTSTRUSTS

The general rule in most states is that creditors can reach the interest of the Trustor (the maker of the trust) of domestic self settled trusts

Recently, several states have adopted legislation somewhat similar to various offshore jurisdictions that provide by statute various degrees of asset protection for a trustor’s interest as a beneficiary in a self settled trust

Alaska, Delaware, Rhode Island, South Dakota and Nevada seem to have the best laws.

If properly set up and maintained, the Domestic Asset Protection Trust will be a significant barrier to creditors and will afford significant leverage to the debtor with respect to its negotiations with the creditor. This is especially true if the assets of the trust that need to be protected are domiciled in a state which is the domiciliary of the Asset Protect Trust

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Why Go Offshore?Why Go Offshore?

2.) International Connections

Relatives or Family Offshore Own Property Offshore Doing Business Offshore

1.) To set up your nest-egg and protect your liquid funds

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FOREIGN ASSET PROTECTION FOREIGN ASSET PROTECTION TRUSTSTRUSTS

A Foreign Asset Protection Trust is a trust that is set up in an offshore jurisdiction which has enabling trust legislation providing for substantial protection against creditors of the trustor

One of the greatest advantages of the Foreign Asset Protection is the fact that by its very nature any legal attack against its assets are transferred abroad to a different legal system

A foreign Trustee is necessary for the efficacy of the Foreign Asset Protection Trust

The biggest advantage in utilizing the Foreign Asset Protection Trust is that assets can be placed offshore beyond the jurisdiction of the U.S. courts

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Modular StructuringModular Structuring

The Modular Structure

DAPTor

FAPT

LLC#1 LLC#2

95% Member 95% Member

5% Member 5% Member

Real Property Liquid Investments

Nearly 100% of neurosurgeons, cardiovascular surgeons, OB-GYN’s sued at least once

90% of general surgeons, radiologists sued

Neurosurgeons are sued most frequently.

Each year, ½ neurosurgeons, 1/3 of orthopedic

and trauma surgeons, ER physicians are sued

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Attorneys with high trust level in their personal MD: 78%

Attorneys with high trust level in MD’s professionally: 41%

MD’s with high trust level in their personal attorney: 71%

MD’s with high trust level in attorney’s professionally: 29%

 

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4% of attorneys found “nothing” positive about

working with physicians2

5% of MD’s found “nothing” positive about working with attorneys

MD’s enjoyed working with attorneys because of

their intelligence and knowledge

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Attorney’s greatest challenge working with physicians are:

arrogance & elite attitude inadequate business knowledge and lack of trust

When attorneys were asked what physicians could do to improve their working relationship,

the overwhelming answer was “trust us”

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Physicians believe the legal system is attacking

their judgment and integrity in a very personal way, and that attorneys (including judges), are not deserving of high levels of trust

When physicians were asked what attorneys could do to improve their relationship, the response was to change the legal system and

was less personal against the attorney

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Different educational processes

Attorneys and physicians most often interact when there is a problem for the physician

Physicians feel attorneys get a free pass as a profession, as the ultimate arbiter, the judge, is an attorney and not a physician

Both attorneys and physicians feel the other does not understand their profession

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Physicians: scientific method95% confidence interval

Attorneys: legal standard of proof51% - preponderance of the evidence

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Treat every patient as a potential plaintiff

Treat every medical record entry as a legal document that will be blown up in front of a jury

Limit high risk procedures

Purchase tail insurance or an Occurrence policy

Practice defensive medicine

Order extra tests and procedures order frequent consultations with other specialists refer patients to ER whenever called

do not take ER call

Move to another state

Retire early

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Learn as much about the physician and specialty PRIOR to meeting

Physician not on call or post-call

Bring spouse

Insist on scheduling follow-up appointment

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Fees

Explanation of estate planning process

Probate

Trusts

Asset Protection

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Mark Monasky

NEUROSURGEON

St. Alexius Hospital

9

00 East Broadway | Bismarck

N

D, 58501

P

hone: 701.530.6629

ATTORNEY

Bormann & Myerchin

4

18 East Broadway | Bismarck

N

D, 58501

P

hone: 701.250.8968 | Fax: 701.250.8982

n

eurosurgeonlawyer@msn.com

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Thank you

JEFFREY R. MATSEN

695 Town Center Drive | 7th Floor | Costa Mesa, CA

92626

Phone: 714.384.6500 | Fax: 714.384.6551

www.wealthstrategiescounsel.com |

www.877probate.com