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What Private Equity Really Means for Your Medical Practice

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Brian Hurley, OneGroup, Senior Vice President Health Care & Business Specialist

Private equity (PE) investment in healthcare has grown quickly, reshaping how medical practices run day to day. For physicians and practice owners, selling to a PE firm is a complex decision. It can open doors for growth and support, but it also brings challenges. —offering strategic advantages and potential pitfalls. In New York State, strict regulatory constraints add another layer of complexity that need to be understood before moving forward.

The Three-to-Five-Year Plan

Most PE firms typically work on a three-to five-year investment plan and during that time they focus on raising the value of the practice thru steps such as: Consolidating smaller practices into larger networks
• Streamlining administrative functions via Management Services Organizations (MSOs)
• Improving billing and coding practices
• Introducing performance metrics and financial targets

While this model can drive short-term profitability, critics argue it may prioritize financial returns over long-term patient care and physician autonomy.

Advantages of PE Ownership

• CAPITAL INFUSION:
Immediate financial resources for technology upgrades, service expansion, or debt reduction.
• OPERATIONAL SUPPORT:
MSOs take time-consuming tasks off your plate providing centralized human resources, IT, andcompliance services, reducing administrative burdens and letting you focus more on patient care.
• NEGOTIATING POWER:
Larger networks often secure better rates with insurers and suppliers.
• EXIT STRATEGY:
Helpful for physicians planning retirement or a transition with financial upside.

Disadvantages and Risks
• LOSS OF AUTONOMY:
Physicians may have less say in clinical decisions and staffing.
• PRESSURE TO PERFORM:
Aggressive financial targets can lead to higher patient volumes and shorter visits.
• STAFFING CUTS:
Cost-cutting measures may impact morale and the patient experience.
• REGULATORY CHALLENGES:
In New York, corporate ownership restrictions require creative structuring through MSOs or joint ventures.


MSOs:
Navigating Compliance
MSOs handle non-clinical operations while physicians stay in charge of medical decisions. This model lets private equity groups support and influence the business side without violating state rules that limit non-physician ownership.

New York’s Landscape

The state’s corporate practice of medicine doctrine limits direct ownership by nonphysicians. This means PE firms often succeed by focusing on specialties like dermatology and ophthalmology, where economies of scale and centralized services offer clear advantages.

Final Thoughts
Private equity can provide growth, efficiency, and financial stability—but not without trade-offs. It can also change how physicians work and make decisions. The best approach is to balance the financial upside with the impact on autonomy and patient care. In regulated environments like New York, success depends on thoughtful structuring and a commitment to patient care.

Thinking about how private equity could impact your risk exposure or insurance needs?
OneGroup’s Risk Management and Insurance team can help you sort through your options and stay compliant as you plan for the future.

OneGroup is uniquely qualified to help physicians and medical practices with all of their business challenges. If you have any questions or would like additional information, please feel free to reach out to Brian Hurley at 315-708-3635, bhurley@ onegroup.com or Lynn Trentini 518-698- 9997, ltrentini@onegroup.com.

References

Commonwealth Fund. (2023a, November). Private equity’s role in health care. https://
www.commonwealthfund.org/publications/explainer/2023/nov/private-equity-role-health-care

Medical Economics. (2023). Navigating the pros and cons of selling your medical practice to private equity. https://www.medicaleconomics.com/view/navigating-the-pros-and-cons-ofselling-your-medical-practice-to-private-equity American Journal of Medicine. (2023). What happens when private equity firms sell medical practices. https://www.amjmed.com/article/
S0002-9343(23)00589-2/fulltext

Commonwealth Fund. (2025, May). How private equity deals are reshaping your health care [Podcast]. https://www.commonwealthfund.org/ publications/podcast/2025/may/how-privateequity-deals-are-reshaping-your-health-care Harvard Business School Library. (n.d.). What happens when private equity firms sell medical practices. https://www.library.hbs.edu/workingknowledge/what-happens-when-private-equityfirms-sell-medical-practices

When the Algorithm Acts Alone:The Risks of and Emerging Standards Regarding Agentic AI in Healthcare.

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By: Scott Carroll, Kennedy Farr, and Jennifer Forward

Kennedy A. Farr

Jennifer Forward

Scott Carroll

Agentic artificial intelligence (“agentic AI”) refers to systems that can independently plan and execute multi-step tasks without continuous human direction. Today, these systems can analyze charts, labs, imaging, and medication lists, identify concerning trends, and even draft suggested care plans on their own.

This autonomy distinguishes agentic AI from traditional “generative AI,” such as ChatGPT, Microsoft Copilot, or Google Gemini. Generative AI cannot initiate tasks because it waits for human prompts and cannot interact with operational systems to schedule tasks. Once a conversation with a human ends, generative AI does not retain goals or continue working toward them. Agentic AI, by contrast, maintains objectives over time, continuously monitors new information, and adapts its actions to achieve its programmed goals.

While agentic AI promises potential relief from workforce shortages and could automate routine clinical tasks, it also comes with clinical, security, and ethical risks.

Clinically, agentic AI errors in diagnosis or treatment recommendations and orders could lead to patient harm. Agentic AI learns from human-provided data, and biased data can perpetuate health inequities. Further, since such systems by their nature operate autonomously, a single mistake can trigger a chain of incorrect actions that may harm a patient.

Security risks arise because agentic AI requires broad access to sensitive patient information. Weak security could expose data to breaches, and malicious actors could potentially hack an agentic system, allowing it to take harmful actions.

Accountability becomes unclear when an agentic AI system makes a mistake. Responsibility will likely fall on the clinician who used the tool, the facility that deployed it, and the developer who built it. Such a complicated and evolving legal and risk management landscape creates liability concerns. Indeed, MLMIC has issued several publications addressing risk management and the use of AI in clinical settings.

Practitioners should recognize that using agentic AI creates a professional obligation to understand the tools well enough to ensure satisfaction of the medical standard of care and to uphold the duty to do no harm. Errors made by agentic AI can breach these duties, especially when practitioners lack proper knowledge of how to use the system. Use of experimental or novel tools on patients also implicates concerns related to patient disclosure and consent and human subject safety considerations (and potential requirements for Institutional Review Board approvals). Finally, there is also the risk that increased reliance on automated systems could erode the human empathy central to patient care, as agentic AI cannot understand or express compassion.

Agentic AI is moving from pilots to clinical use, but guidance remains varying. Leading health coalitions, including the Coalition for Health AI and the Trustworthy and Responsible AI Network, have advanced methods to assess safety and performance. Additionally, there are some growing sets of guidelines to use when evaluating and validating this new technology. For example, on September 10, 2025, the Consumer Technology Association (CTA), North America’s largest technology trade association, released a new standard for validating AI tools that predict health outcomes. This fifth CTA AI standard offers a structured scheme for testing predictive algorithms in controlled and real-world settings. It emphasizes transparency about training data, encourages developers to ensure models can explain how they arrive at specific predictions, and calls for robust post deployment plans to monitor quality and recalibrate when performance drifts.

The sector has not united around one approach, leaving potential users to navigate a patchwork of frameworks. We expect over time that there will be a consolidated set of standards and guidelines for development and clinical use that developers, hospitals, systems, and clinicians can refer to when implementing AI and machine learning tools, including agentic AI.

Regarding regulation in New York State, there are not yet agentic-AI-specific rules for clinical care, but New York has established guidelines that will shape deployment in health settings. In 2023, the Governor issued an executive order establishing an AI policy and governance framework and directing ethical-use policies for state agencies, followed in 2024–2025 by guidance from the Office of Information Technology Services on responsible use of generative AI.

State medical boards retain their principal role of regulating the practice of medicine and have likewise begun articulating principals for the use of AI in medical practice, emphasizing that agentic systems cannot independently practice medicine, licensed clinicians remain ultimately responsible for diagnosis and treatment decisions assisted by AI, and development should be transparent, documented, and consistent with the standard of care, patient safety, and existing scope-of practice supervisions requirements. Indeed, over the last year, the New York State Board of Medicine has engaged in discussions with technical, legal, and regulatory representatives regarding this topic. However, no formal guidance or advisories have yet been issued by the Board. Additionally, professional specialty boards may develop their own specialty specific guidance for using agentic AI. Providers should closely monitor guidance from the Board of Medicine and their professional societies.

For hospitals and clinicians, professional standards operate alongside Department of Health requirements for the operation of hospitals and clinics, such as quality assurance, credentialing, and risk management, that apply when agentic AI influences diagnosis or treatment. Additionally, regulatory issues arise with agentic AI. Agentic AI systems may require FDA oversight, warranting premarket review and ongoing controls, because when, to a reasonable person, it provides medical treatment or clinical decision support that influences care, it could be considered a medical device warranting oversight. Users of AI and machine learning applications, including agentic AI, should understand the level of oversight by the FDA of their specific application and its current status.

The regulatory and industry guidance discussed in this article do not resolve the legal issues but provide early guidance to practitioners and the industry as agentic AI enters clinical practice. Physicians and medical groups considering any AI tool need to evaluate these tools as they would any new medical device or drug, ensuring they understand the technology, its intended use, and built-in safeguards, and take additional risk management steps that are appropriate based on the nature of the tool. If you have questions about the topics discussed in this article, please contact Lippes Mathias health law team members Scott V. Carroll (scarroll@lippes.com), Kennedy A. Farr (kfarr@lippes.com), or Jennifer Forward (jforward@lippes.com).

 

Auburn Community Hospital Appoints Migdalia Bonilla-Martir, MD as Chief of Obstetrics and Gynecology

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Auburn Community Hospital (ACH) is pleased to announce the appointment of Migdalia Bonilla-Martir, MD, FACOG, as Chief of Obstetrics and Gynecology.

Dr. Bonilla-Martir brings extensive clinical and academic experience, a strong commitment to patient-centered care, and proven leadership in developing comprehensive women’s
 health services. She joins ACH from Vassar Brothers Medical Center in Poughkeepsie, N.Y., part of Nuvance Health, which recently joined Northwell Health. The system was recognized with a 2025 Women’s Choice Award for Best Hospital and is nationally regarded for excellence in women’s healthcare.

Throughout her career, Dr. Bonilla-Martir has provided comprehensive obstetric and gynecologic care, with a focus on improving outcomes for women at every stage of life. In her new role, she will oversee departmental clinical operations, support quality and patient safety initiatives, and lead the growth and enhancement of comprehensive women’s services at Auburn Community Hospital.

“We are thrilled to welcome a physician of Dr. Bonilla-Martir’s caliber to Auburn Community Hospital,” said Scott Berlucchi, President and CEO. “Her expertise, compassion, and vision for advancing comprehensive women’s healthcare in Central New York make her an outstanding addition to our medical leadership team. Dr. Bonilla-Martir will lead efforts to create and implement a full spectrum of women’s health services that address the evolving needs of women throughout their lifetimes.”

Dr. Bonilla-Martir expressed her enthusiasm for joining ACH, saying, “I am honored to take on this role and to serve a community that values high-quality, accessible care. I look
forward to working closely with hospital leadership, providers, staff, and patients to better understand and address the individual healthcare needs of women in Central New York.”

Auburn Community Hospital remains committed to expanding specialty services and strengthening its medical staff. The appointment of Dr. Bonilla-Martir reflects the hospital’s continued dedication to recruiting exceptional clinicians who are committed to serving the region.

To schedule an appointment with Dr. Bonilla-Martir, please contact Auburn OB/GYN at 315 252-5028.

Turtle: Building on a Century of Industrial Partnership

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By Bari Faye Dean

For more than 100 years, Turtle has been a steady partner to contractors through every wave of industrial transformation. Since its founding in 1923 with a single truck in Lower Manhattan, the company has guided customers from the era of early electrification to today’s age of energy modernization and intelligent infrastructure. Turtle now serves customers throughout the United States and Puerto Rico.

What hasn’t changed is Turtle’s core commitment to being a consistent, reliable partner who listens to contractors’ needs and designs solutions tailored to real-world challenges.

In fact, this customer-first approach has been the foundation of Turtle’s success for over a century, and it continues to shape the company’s growth in Central and Western New York.

‘Customer-obsessed’ Vision Fuels Entrepreneurial Growth in Central, Western NY

When Turtle entered the Syracuse market, it started with a clean slate. Since 2021, under the leadership of Wendy Buchholz, vice president, Sales, the office quickly grew into a thriving regional hub. Buchholz brought decades of experience in manufacturing, infrastructure, and energy solutions, and, perhaps even more importantly, deep local relationships.

“I had the advantage of coming from a manufacturing background, so I understood both sides of the relationship,” Buchholz said. “When I joined Turtle, I went back to people who had trusted me for years. This business has always been about relationships, and I knew we could build something special by listening first and selling second.”

Her philosophy of prioritizing relationships over resumes has defined her leadership style. “As we continue to build our team, I will always choose someone with the ability to build strong relationships over someone with years of electrical background. You can teach technical knowledge, but you can’t teach the ability to listen, connect, and earn trust,” she said. “At Turtle, we are customer-obsessed. Our focus is always on meeting the client’s needs. We are growing by making sure all of our team members believe in our mission.”

That emphasis on trust and accountability has resonated throughout the Turtle team. “Wendy’s leadership style and experience has had a significant impact on how the sales team approaches contractor partnerships,” said Marco Arguinzoni, Inside Sales. “She leads with a balance of accountability and support, making sure the team has both the structure and the confidence to succeed. This has helped us build stronger, trust-based relationships with contractors by focusing on consistency, clear communication, and solutions rather than just transactions.”

End-to-End Support for Contractors

Turtle’s value extends well beyond procurement. The company engages across the full project lifecycle, from early design and value engineering through layout planning, prefab, kitting, staging, and on-time delivery. These services give contractors greater schedule reliability, reduce jobsite handling, and maximize labor efficiency.

Make no mistake about it, these are critical advantages in a market where skilled labor is scarce.

“Contractors today don’t need cookie-cutter solutions,” Buchholz said. “Every job is unique, and our role is to adapt to whatever the customer requires. We take the time to understand what our customer really needs and customize a plan that helps them finish faster with less stress on their crews.”

That adaptability is matched by a deep service mindset, explained John Sica, Manager of Inside Sales. “What I believe customers value most from Turtle is our service. We’ve been a service-driven, customer-first company for 102+ years. Salespeople have the autonomy to make decisions in real time that allow us to provide more immediate service. On top of that, our specialty departments, including Switchgear, Lighting, EV Charging, Panel Shop, and Energy set us apart from the competition. When a company works with Turtle, they’re getting a solutions partner with years of knowledge and experience.”

Embracing Technology and Digital Tools

Turtle’s evolution has always meant adapting to the latest technology. Recent investments include a newly designed website at Turtle.com, Shop Turtle, an upgraded eCommerce platform, and Turtle Express, an on-demand delivery service with SMS updates. The company has also adopted an AI-powered quoting tool, Canals, that dramatically accelerates bid turnaround.

Buchholz said this is a key factor that fuels Turtle’s ability to remain nimble, ahead of the curve, and always putting customers first. For example, quotes that used to take hours are now turned around in minutes. “We have come to realize these tools aren’t replacing relationships; they’re strengthening them. They give us more time to focus on what matters most: helping our customers succeed.”

Inside Sales Associate Jaime Purish-Conrad experienced that firsthand. “Turtle’s AI tool for inside sales allows us to quickly identify options that will best suit our customers’ needs. Things are moving at a faster pace these days and Canals is a real game-changer for us,” Purish-Conrad said. “Embracing AI is already helping Turtle stand out from its competition.”

Certified Partnership with Added Value

As a certified Woman-Owned Business Enterprise (WBE), Turtle also helps contractors meet compliance requirements and strengthen bids for public and private projects. Beyond the designation, the certification reflects Turtle’s broader commitment to inclusion and opportunity, values that resonate across the construction industry.

“Diversity isn’t a checkbox for us, it’s a core value “Buchholz said. “Our WBE certification is important because it opens doors for our contractor partners. But at the heart of it, it’s about making sure opportunity is shared, and that we bring new perspectives into every project.”

Powering the Future of New York

With New York leading the transition to cleaner, smarter energy, Turtle is playing a pivotal role in projects ranging from EV charging infrastructure to energy-efficient power distribution systems. The company’s expertise spans commercial, industrial, and residential markets, ensuring contractors are well-positioned to meet evolving codes and grid demands.

“The opportunities in Central and Western New York are enormous,” said Buchholz. “From semiconductors to food production to the expansion of EV infrastructure, contractors in this region are at the center of it all. Turtle is here to make sure they have the tools, materials, and support they need to lead that growth.”

Investing in People, Technology, and the Region

Turtle is fully invested in Central and Western New York, making ongoing commitments in talent, tools, and technology. The company is aligning with growth in industries such as semiconductors, food production, and

 large-scale construction, ensuring contractors have a 

reliable partner for both today’s opportunities and tomorrow’s challenges.

“Turtle hasn’t become the company we are today, with over 1,000 employees and growing, through an acquisition. We built this operation organically,” Buchholz said. “That means we’re 100 percent vested in this marketplace. Every investment we make, whether in people, technology or infrastructure, is with the long-term success of Central and Western New York in mind.”

A Reliable Partner for What’s Next

Turtle recently launched a new website and the main message on the homepage says it all: “Powering What’s Next…”

Ultimately, Turtle’s evolution reflects its core belief: success comes from being customer-centric, adaptable, and future-focused, Buchholz maintained. For contractors in Central and Western New York, Turtle is more than a distributor, “we are a trusted partner helping our customers deliver projects with precision, efficiency, and confidence.”

At the end of the day, contractors are looking for more than materials. Buchholz concludes: “They want a partner who shows up, listens, and solves problems with them. That’s who Turtle has been for more than 100 years. And, that’s who we’ll continue to be as this industry continues to evolve.”

For more information about Turtle, visit Turtle.com

The Impact of Artificial Intelligence on the Future of Construction Estimating

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Earl R. Hall, Executive Director, Syracuse Builders Exchange

The construction industry is entering a transformative era where artificial intelligence (AI) is set to redefine traditional estimating processes. Accurate project cost estimation has always been a critical factor in the success of construction projects.  AI technologies, particularly those involving machine learning and predictive analytics, are poised to enhance the speed, precision, and efficiency of estimating, enabling contractors to remain competitive in an increasingly data-driven market.

Enhancing Accuracy Through Data-Driven Insights

Although many contractors today utilize estimating software, traditional estimating relies heavily on human judgment, historical data, and manual analysis. While experienced estimators bring valuable expertise, human error and time constraints can affect accuracy. AI algorithms, by contrast, can process vast amounts of historical cost data, project specifications, and market trends in seconds.

Machine learning models can identify patterns that humans might overlook, such as subtle correlations between design choices and cost impacts. For example, AI can detect how changes in material supply chains or labor availability in specific regions of New York State influence costs. This level of predictive precision allows estimators to develop more reliable budgets and contingencies, reducing the risk of overruns.

Automation of Repetitive Tasks

One of AI’s most immediate impacts will be the automation of routine estimating activities. Tasks such as quantity takeoffs, data entry, and comparison of vendor quotes can be handled by AI-powered tools. Optical recognition systems can read and interpret blueprints or BIM (Building Information Modeling) files to automatically extract material quantities and specifications.

By automating repetitive functions, estimators can allocate more time to strategic decision-making, negotiation, and client communication activities where human judgment and relationship skills remain critical.

Integration with BIM and Project Management Systems

AI’s synergy with various BIM platforms will further enhance estimating accuracy and collaboration. By linking AI-powered estimating tools directly to BIM models, any design modification can instantly trigger an updated cost estimate. This real-time feedback loop empowers architects, engineers, and owners to make informed decisions earlier in the design phase, when changes are less costly to implement.

Integration with project management software can also enable continuous monitoring of actual costs versus estimates during construction. AI can flag deviations in real time, allowing for proactive adjustments rather than reactive corrections.

Predictive Risk Analysis

AI’s predictive analytics capabilities extend beyond cost estimation into risk forecasting. By analyzing historical project data, AI can highlight potential risk factors such as weather-related delays, supply chain disruptions, or labor issues. Estimators can then incorporate these risks into cost and schedule forecasts, creating more resilient and realistic bids.

This proactive risk assessment can also improve contractor-client relationships by fostering transparency and demonstrating preparedness for unforeseen challenges.

Market Competitiveness

In a competitive bidding environment, the ability to produce accurate, detailed estimates quickly is a significant advantage. AI not only shortens estimating timelines but also enables firms to analyze multiple bid scenarios with ease. Contractors can compare design alternatives, procurement strategies, and schedule adjustments to determine the most cost-effective approach.

Over time, companies that adopt AI in their estimating workflows will likely outperform those relying solely on traditional methods, as they will consistently deliver bids that are both competitive and financially viable.

Challenges and Considerations

While the benefits are substantial, implementing AI in construction estimating is not without challenges. The accuracy of AI models depends on the quality and quantity of data available. Many construction firms will need to invest in digitizing historical records and standardizing data formats. There may also be resistance from experienced estimators who are skeptical of AI’s reliability or concerned about job displacement.

Addressing these concerns will require clear communication that AI is a tool to enhance, not replace, human expertise. Training programs that upskill estimators in AI-assisted workflows will be essential.

Conclusion

AI’s integration into building construction estimating represents a major leap forward in efficiency, accuracy, and strategic capability. By automating routine tasks, enhancing data-driven decision-making, and enabling predictive risk analysis, AI empowers contractors to deliver more reliable bids and manage projects more effectively. While adoption will require investment in technology, data management, and training, the long-term benefits in competitiveness and project success make AI a critical factor in the future of construction estimating.

Edited by Chat GPT

Protect Your Right to Be Paid – What You Need to Know to Make a Claim on a Payment Bond

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Sheats and Bailey, PLLC

Hardly a week passes that our firm is not asked to file a claim on a payment bond for one of our clients on projects in upstate New York and in New York City.  A claim on a payment bond, like a mechanic’s lien, can be an effective device for getting you paid.  It is not the only legal tool at your disposal, but it can be a very effective tool.  This article will provide a few things you need to know about making a claim on a payment bond.  

Payment bonds are required by Section 137 of the State Finance Law on public projects.  Payment bonds are not a guarantee of payment; they are an undertaking by a surety which provides that a company providing work or materials for a project will have added security beyond the assets or liquidity of the contractor with whom you have a contract.  In other words, the payment bond provides another deep pocket to get your money from.  I am sure you have encountered or heard of fellow subcontractors/suppliers that performed work/supplied materials, but never got paid because the upstream contractor went out of business.  A claim on a payment bond can prevent that from happening to you.   

In order to place a valid claim on a payment bond on a public project you need to be mindful of certain time limitations.  An action against a payment bond on a public project must be brought within one year from when the project was completed and accepted.  If your action is brought against the bond after the one-year statute of limitations expires then the action may be dismissed.

If you are a second-tier subcontractor/supplier on a project then you must also provide an additional notice by certified mail, return receipt requested, to the up-line contractors, owner, and the surety.  The notice must generally provide a description of the work, the party you had a contract with, the amount of money due to you, your initial contract price and when the money was due.  Second tier subcontractors must give that notice within 120 days of when the project was completed and accepted.  Although there are exceptions, the failure to provide the notice may prevent you from asserting a claim on the bond.        

Sometimes private owners, like hospitals, universities, and museums, require contractors to provide a payment bond for their projects.  Private improvement bonds typically contain similar, but not identical, notice provisions and statutes of limitations as outlined above.  Often, the payment bonds on private projects require notice from second tier subcontractors/suppliers within 90, not 120 days, of when they last supplied labor/materials.   

Considering the tight time frames to make a claim on a bond, the best thing to do is get a copy of the bond for your records early in the project.  Have your PM and/or accounts receivable person calendar the statute of limitations within the bond and any notice requirements.  If you want to find out who the surety is then call the architect of record or send the public owner a Freedom of Information request; it is little more than a letter stating that the request is “pursuant to the Freedom of Information Law.”

People often ask if they should file a mechanic’s lien or make a claim on the bond.  Why not do both.  However, there are a few advantages to making a claim on the payment bond.  Very often an action against a payment bond will be a less cumbersome and less expensive way to recover your money than filing and foreclosing a mechanic’s lien.  Plus, the existence of a lien fund (i.e., does the owner owe money to the GC) is immaterial to a payment bond claim, but is necessary to prove to foreclose a lien.  Likewise, the presence of any other claimants on the bond or those with other mechanic’s liens are immaterial.  A payment bond action can be as simple as your company versus the surety.

Lastly, there is a little known provision in New York’s General Obligations Law that requires private owners to file a copy of the payment bond with the county clerk.  Failure to do so may result in the private owner paying some of your legal fees.    

The information provided in this article is not intended to serve as specific legal advice for any particular situation.  Competent legal and experienced counsel should be consulted if you are facing a nonpayment situation.

Understanding the New CPAP Program Effective October 1, 2025

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Steven Bell, Vice President, Lovell Safety Management Co., LLC

If you’re a contractor in New York, you’ve likely heard of the Construction Classification Premium Adjustment Program (CPAP). For years, CPAP has provided a way for contractors who pay higher-than-average wages to receive premium credit on their workers’ compensation policies. The goal has always been simple: rewarding employers who invest in skilled, highly compensated workers.

Beginning with policies effective October 1, 2025, and later, the New York Compensation Insurance Rating Board (NYCIRB) is rolling out a redesigned CPAP. These changes will impact on how credits are calculated, how data is collected, and how contractors can ensure they don’t miss out on valuable premium savings.

Lovell is committed to making sure our contractor clients understand the changes, meet the new requirements, and receive every dollar of credit they’re eligible for. Here’s what you need to know.

Why the Change?

The old CPAP process relied heavily on employers filling out applications and submitting wage information once a year. Participation wasn’t as high as it should have been, and the single wage threshold didn’t always reflect the realities of today’s construction market.

The NYCIRB redesigned CPAP to:

  • Increase participation by making it automatic through the audit process.
  • Shift the burden to carriers, reducing paperwork for contractors.
  • Better compensate wage differences by applying credits at the class code level, not across the board.

In short: this is a modernization of CPAP that should make it easier for more contractors to benefit.

What’s Changing in CPAP

Here are the key updates contractors need to keep in mind:

  • No More CPAP Application
    You won’t have to apply for CPAP anymore. Instead, carriers (like NYSIF) will gather wage and hour data during your audit and submit it to the NYCIRB automatically.
  • Credits Based on Annual Payroll
    Instead of looking at a single quarter, credits will now be based on your entire year of payroll data, making results more accurate.
  • Class Code-Specific Wage Thresholds
    Gone are the days of one-size-fits-all wage tables. Credits will now be calculated for each eligible class code, using average hourly wages compared to prevailing NYS Department of Labor rates.
  • Estimated Credits at Quotation
    For the first time, carriers will calculate an estimated CPAP credit up front at the time of quotation, provided you submit the required data.
  • Final Credit Determined at Audit
    Just like with other parts of your policy, the final CPAP credit will be determined after the annual audit when your actual payroll and hours are verified. NYCIRB will finalize the number, and it will be applied at that point.

How Contractors Can Secure Their CPAP Credit

While CPAP is now built into the system, there are still important steps you’ll need to take to make sure your estimated credit is applied before your audit.

Deadlines Matter

To have your estimated credit applied and your policy rebilled before audit, you must:

  • NYSIF policyholders must submit your CPAP estimate within 6 months of your policy’s effective date.
  • If you miss this deadline, your credit will only be applied once the final audit is completed.

What You’ll Need to Submit

To calculate your estimate, contractors will need to provide:

  1. Total payroll (straight time only) for all class codes.
  2. Number of employees for CPAP-eligible class codes and/or
  3. Average hourly wage for each CPAP-eligible class code on the policy.

 

 

Two Submission Options

Lovell and NYSIF are making it simple:

  • Complete the Excel spreadsheet provided by Lovell, or
  • Use the NYSIF Online CPAP Estimator.

How Lovell Is Helping

At Lovell, we know how valuable these credits can be for contractors. That’s why we’re taking a proactive approach:

  • Advance Notices – About 60 days prior to renewal, we’ll be sending notices (with the payroll spreadsheet attached) to clients who may qualify.
  • Hands-On Guidance – Our team will be available to help you complete the spreadsheet, use the estimator, and ensure your data is submitted correctly.
  • Ongoing Support – If there are any discrepancies between your estimate and what NYCIRB calculates at audit, we’ll coordinate with NYSIF on your behalf.

The bottom line: while CPAP is changing, you won’t have to navigate it alone.

What Contractors Should Do Now

Right now, no action is required. But as October 1, 2025 approaches, contractors should:

  1. Stay tuned for updates. Lovell will continue to provide guidance as NYCIRB finalizes implementation details.
  2. Gather payroll records. Accurate data will be the key to securing your CPAP credit.
  3. Be ready to respond. When you receive Lovell’s notice and spreadsheet, complete it promptly so you don’t miss the six-month window for an estimated credit.

Why This Matters for Contractors

Construction margins are often tight, and workers’ compensation is a significant expense. CPAP credits can add up to real savings—sometimes thousands of dollars annually—for employers who pay competitive wages.

The redesigned program is intended to make those savings more accessible and better aligned with today’s labor market. By working with Lovell and providing the right data on time, you can make sure you capture every bit of credit you deserve.

 

Final Thoughts

The new CPAP program is a positive change for New York contractors. It reduces paperwork, provides more accurate credits, and ensures high-wage employers are rewarded. But the new system also comes with new deadlines and data requirements that can’t be overlooked.

Lovell is here to guide you every step of the way—from sending the right forms to coordinating with NYSIF and ensuring your credit is applied.

Effective October 1, 2025, CPAP changes the game. Make sure you’re ready to play —and to save.

If you have questions about how these changes may impact your business, don’t hesitate to reach out to a Lovell representative at 1-800-556-8355.

 

Don’t Let Hackers Delay Your Projects

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OneGroup

Cyberattacks threaten your business operations, revenue stream, intellectual property, client data, and reputation. Protect your company from digital hazards.

In the construction industry, cybersecurity is no longer just an IT issue, it’s a business continuity issue. As firms adopt digital tools like project management software, drones, smart machinery, and cloud-based collaboration platforms, they become increasingly exposed to cyber threats. Construction companies often manage large volumes of sensitive data, including architectural plans, financial records, employee information, and client contracts. A breach can disrupt job site operations, delay timelines, compromise safety, and damage relationships with clients and subcontractors.

Cyberattacks are relentless. A 2024 Cloud Security Report by Check Point revealed that 73% of cybersecurity teams received 10 or more security alerts daily; 61% reported security incidents in the past year. Hacked once? Expect a return visit. According to IBM’s 2022 Cost of a Data Breach Report, 83% of companies experiencing a data breach were hit multiple times.

The cost of recovering from a cyberattack is more than paying a ransom. In 2024, cybercriminals hacked Change Healthcare, compromising the health data of one-third of Americans. Change Healthcare paid the hackers $22 million in Bitcoin to unlock data, without a guarantee that the data hadn’t been copied or sold. Experts estimate it will cost nearly $3 billion to cover fines, credit monitoring services, lawsuits, reputational damage, and network reconstruction. That’s on top of the ransom.

Cyberattacks can lead to bankruptcy. A 157-year-old college in rural Illinois was forced to close after a ransomware attack locked them out of their data. They never recovered from the lost enrollments and network damage.

Why the Construction Industry Is a Growing Target

Construction companies are increasingly vulnerable to cyber threats due to their reliance on digital tools, mobile devices, and cloud-based project management platforms. From blueprints and bid documents to subcontractor agreements and client data, the industry handles sensitive information that hackers find valuable.

Key vulnerabilities include:

  • Project delays and downtime: A ransomware attack can halt operations, delay timelines, and inflate costs.
  • Third-party risk exposure: Construction firms often work with multiple vendors and subcontractors, increasing the risk of compromised networks.
  • IoT and smart equipment: Connected devices on job sites can be entry points for cybercriminals.
  • Employee data and payroll systems: Hackers target HR systems for personal data and financial access.

What a Cyber Insurance Policy Can Do for Your Business

A well-structured cyber policy can help with:

  • Lost income due to project delays
  • Customer and subcontractor data breach notifications (legally required in most states)
  • Free credit monitoring for affected individuals
  • Legal defense, state fines, damages, and settlement awards
  • Reputational damage and public relations support
  • Restoration of computers, mobile devices, and networks
  • Technology improvements to prevent future hacks
  • Ransomware attacks
  • Breach response plans

OneGroup can help you decode complex cyber jargon and match you with a customized policy tailored to the construction industry.

Apply in Confidence

Insurance companies will scrutinize your cybersecurity. They’ll ask questions like:

  • How much personal and project data do you collect and store, including paper files?
  • Do you use antivirus software, strong passwords, and multifactor authentication?
  • Do you have a written cyber incident response plan?

Don’t let cyber threats bring your construction projects to a halt. Protect your business, your data, and your reputation before an attack hits. Reach out to Brett Findlay by calling 315-480-7027, he’ll connect you with a specialist who understands the unique risks facing contractors and can help you prepare with confidence.

Six Pertinent Provisions of the OBBBA for Construction Companies

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Nicholas L. Shires, CPA, Dannible & McKee, LLP

The One Big Beautiful Bill Act (OBBBA) introduces sweeping changes with significant implications for construction business owners and their leadership teams. As companies evaluate the legislation, it’s important to focus on the provisions most relevant to day-to-day operations. Here are six key areas to study.

  1. Accounting Exemption

For tax years beginning on or after July 4, 2025, contracts entered into for residential construction projects, per the amended definition under the OBBBA, generally qualify for an exception to the percentage-of-completion method of accounting.

That means, if eligible, you can use the completed-contract method (CCM) or other permissible methods. Under the CCM, for example, you can defer income until a project is substantially completed, which generally improves cash flow.

  1. Accelerated Depreciation

The OBBBA includes multiple provisions that will allow you to accelerate depreciation on eligible capital expenditures. These breaks can also improve cash flow, as well as make new investments in equipment and machinery more viable.

The law makes permanent 100% first-year bonus depreciation for qualified new and used assets acquired and placed in service after January 19, 2025. It also increases the Section 179 expense deduction limit to $2.5 million, with the phaseout threshold raised to $4 million. Those figures are effective for 2025, with annual inflation adjustments going forward.

In addition, the OBBBA creates a temporary 100% deduction for the cost of building “qualified production property” — for instance, facilities used to fabricate materials. This could boost demand for projects related to manufacturing. Construction must have begun after January 19, 2025, and before January 1, 2029, and the property must be placed in service before 2031.

  1. Bigger Business Interest Deductions

If you finance capital purchases, you may be able to deduct more of the interest under the OBBBA. The business interest deduction is generally limited to 30% of your adjusted tax income (ATI). Since 2022, though, deductions for depreciation, amortization or depletion were not added back to taxable income when calculating ATI. So, ATI was effectively measured based on earnings before interest and taxes, not earnings before interest, taxes, depreciation and amortization (EBITDA).

Beginning with the 2025 tax year, the OBBBA provides that ATI will again include depreciation, amortization and depletion in the calculation. In other words, ATI will revert to being calculated based on EBITDA. This will effectively increase the ATI base, generally raising the allowable business interest deduction.

  1. Distressed Community Construction Incentives

The quality opportunity zone (QOZ) program generally allows taxpayers to defer, reduce or exclude unrealized capital gains reinvested in qualified opportunity funds (QOFs). These funds invest in designated distressed communities across the country.

The OBBBA establishes a permanent QOZ policy that enhances the original program, which had been slated to sunset after 2026. The law also creates a new type of QOF for rural areas. Plus, the OBBBA permanently enhances the low-income housing tax credit. In sum, these programs could drive higher construction activity — including affordable housing and commercial development.

  1. Reduced Taxation of Overtime

For tax years 2025 through 2028, the OBBBA allows employees to deduct up to $12,500 ($25,000 for joint filers) of qualified overtime pay. This tax break is available regardless of whether a taxpayer itemizes. However, it begins to phase out when an individual’s modified adjusted gross income exceeds $150,000 (or $300,000 for joint filers).

The boost to take-home pay may make overtime more enticing to existing construction workers and job seekers considering the industry. But it also requires employers to track and report the amount of qualified overtime pay. What’s more, overtime pay will remain subject to payroll taxes and state income taxes.

  1. Elimination of Clean Energy Incentives

The OBBBA targets many of the clean energy incentives created or enhanced by the Inflation Reduction Act — including some that have spurred construction plans and projects. For instance, it eliminates the Sec. 179D energy-efficient commercial building deduction for buildings or systems on which construction begins after June 30, 2026.

The new law also eliminates the Sec. 45L new energy-efficient home credit for eligible contractors. The credit was due to expire in 2033, but it’s now available only for homes acquired on or before June 30, 2026.

And That’s Not All

The provisions highlighted here are only a portion of the changes in the OBBBA that could impact your construction business. Acting now is critical to identify the most relevant tax-law changes and take full advantage of the tax breaks available before opportunities are missed.

Nicholas L. Shires, CPA, is the partner-in-charge of tax services at Dannible & McKee, LLP, a certified public accounting firm with offices in Syracuse, Auburn, Binghamton and Schenectady, NY, as well as Tampa, FL. With over 20 years of experience, Nick provides tax and consulting services to a wide range of clients, with a focus on the construction industry. For questions regarding the tax provisions of the One Big Beautiful Bill Act (OBBBA), contact Nick at nshires@dmcpas.com or (315) 472-9127. Learn more @ DMCPAS.com.

2025 Year in Review

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Earl R. Hall Executive Director – Syracuse Builders Exchange

As the fourth quarter of the year begins, we at the Syracuse Builders Exchange (SBE) reflect on the success of the past 12 months, as we begin to focus on 2026 with optimism and excitement.

The past year marked another period of record growth and achievement for SBE and our members. Guided by our mission to acquire and disseminate important industry information, further the best interest of the regional building and construction industry, and to foster and develop relationships within the industry, SBE delivered measurable value across our wide range of membership benefits and services throughout the year.

Acquiring and Disseminating Information

Through Syrabex’s e-plan room, weekly e-bulletins, periodic emails, and Construction Contractor Magazine, SBE acquired and disseminated timely and important information construction industry employers and their employees rely upon every day.  Whether it’s construction projects in the planning stages, projects actively bidding, bidders lists, contract awards, new federal or state legislation, information from our many professional partners or other information contractors need to know, SBE delivered using a wide range of communication mediums.

Education and Safety Training

SBE’s education and safety training programs reached both record participation and course offerings, equipping members with the skills and knowledge to navigate evolving industry technologies such as Building Information Modeling, safety standards, and general business practices. The Association delivered workshops, seminars, and certifications that not only advanced individual careers but helped employers provide a safer and more efficient working environment both on the job site and in the office.

Safety remained a top priority, with new training modules, additional training resources and instructors, and industry-wide campaigns designed to reduce incident rates for our member firms and the industry in general. These efforts underscored SBE’s commitment to not only our member employers, but ensuring every worker returns home safely at the end of the day.

Membership Growth and Engagement

Membership significantly expanded this past year, led by the migration of 100 new members from the Mohawk Valley Builders Exchange.  Absent those new members, SBE still experienced membership growth, driven by out-of-area contractors looking to take advantage of the Association’s services and the abundance of future construction opportunities central New York will offer over the next decade.

Sustained membership growth reflects the value of SBE’s services, the strength of our membership and the tremendous services our staff delivers every day to our member employers and their employees. Engagement through events, emails, phone calls, and electronic/digital platforms fostered stronger business relationships between our staff and members.

Today, SBE remains New York State’s oldest and largest construction industry Association with approximately1,070 member firms.  Never in the 153-year history of the Association has SBE had more members or more benefits and services.

Networking and Social Event

During the year, SBE provided the most networking and social events in the history of the Association, delivering:

  • Multiple “meet and greets” in the Utica region
  • Two sold-out golf tournaments (Syracuse and Utica)
  • Clay Sport Shooting for Charity
  • Meet the Generals
  • Clambake
  • Meet the MWBE/DBE/SDVO Contractors
  • Cabin Fever (Utica)
  • Two Construction Career Day events (Syracuse and Utica)

These events are vital to SBE’s membership as they strengthen professional relationships, foster collaboration, and create opportunities for members to share knowledge and best practices. These gatherings help connect contractors, suppliers, designers, and industry leaders, often leading to new business partnerships and project opportunities. They also build a sense of community within the industry, allowing members to exchange ideas, discuss challenges, and celebrate achievements together. Ultimately, SBE’s networking and social events enhance the value of one’s membership by promoting growth, visibility, and long-term success for both individuals and companies.

Looking Ahead to 2026

As SBE celebrates this year’s successes, we remain focused on future opportunities and challenges. Our priorities include partnering and collaborating with industry partners to advance workforce development initiatives, embracing technology innovation and new industry standards in our education and safety programs, enhancing the functionality within the e-plan room by applying Artificial Intelligence features to deliver faster and more effective outcomes for our end-users, delivering quality social and networking events, promoting New York State’s only construction industry Multiple Employer Pension Plan (MEP) and continuing to be a strong advocate for SBE’s member employers and the industry.

SBE continues to have a meaningful impact on our contractors, their employees, and our regional community and industry partners.  As we look forward to building on this momentum in 2026, we are reminded that the success of the Association is the result of our loyal, diverse, and dedicated member firms.  On behalf of the SBE staff and Board of Directors, it has been a pleasure to service construction industry employers and their employees during the year.