“Micro-Law” for Health Care Providers

“Micro-Law” for Health Care Providers

New firm FriedemannFoarde develops new strategies to keep its fees low.

When Mary Foarde, a general counsel for Minneapolis-based Allina Hospitals & Clinics, sat across the negotiating table from Konrad “Kit” Friedemann—a Fredrikson & Byron attorney who represented physicians groups, clinics, and other medical clients—she faced a pragmatic lawyer who understood the intricacies of health care law as well as she did. Foarde thought Friedemann would be a great partner for launching a boutique practice focused on the everchanging health care industry.

Fortunately for Foarde, Friedemann was feeling some wanderlust, having spent 32 years at Fredrikson. In June, FriedemannFoarde opened for business.

“I thought this was a real opportunity to offer legal services in a way that would be a better value for our clients,” Friedemann says. He argues that there’s room for both micro-law firms and “big law,” just as small brewers Summit and Surly coexist with Budweiser and Miller. “We have a specific knowledge base, and it’s very much tailor-made to the needs of our clients,” Friedemann adds.

Before starting the firm with Foarde, Friedemann helped launch Fredrikson & Byron’s health care practice; he also grew the firm during a stint as president and CEO. In addition, he cofounded the health law section of the Minnesota Bar Association. Foarde, meanwhile, oversaw the legal work of Allina’s 12 attorneys and outside counsel.

The new firm’s clients include regional hospitals, clinics, physicians groups, and health care administrators and executives. The partners act as business lawyers for health care providers, covering corporate governance and contracts, joint venture agreements, mergers and acquisitions, and interpreting the reams of complex regulation that health care providers must deal with.

Foarde and Friedemann provide these services at roughly a 25 percent discount compared to larger firms by keeping their overhead low. FriedemannFoarde plans to use alternative billing arrangements and services, such as its Virtual General Counsel program. Clients pay a subscription fee to tap into the partners’ in-house expertise, which includes handling litigation management and reviewing regulatory compliance.

The partners contend that health care reform will work in their favor. Clients would put a bigger premium on value and service if new regulations squeeze their bottom lines.

Foarde draws a parallel between lawyers and health care providers that typically operate with fee-for-service models—both can be incentivized to deliver more services than are truly necessary. “It’s the perspective of value—what the value of the services is to the client and how to deliver something that is neither more nor less than they need,” she says.