Physician employment is an integral part of the practice of medicine. Many physicians today are employed by group practices, multispecialty group practices, medical faculty practice plans, hospitals or other institutions. With more medical students than ever entering the work force, this trend is likely to continue and accelerate. At some point in their careers, most physicians will likely be party to a physician employment contract. Physician employment contract lawyer, Barney Cohen of Concierge Healthcare Attorneys, helps physicians just like you throughout the United States at this critical time.
The secret that physician employment contract lawyer, Barney Cohen, wants to share with you is that ALL physician contracts are negotiable.
Many physicians are concerned about a practice’s reaction to the physician’s legal review of the employment contract. However, the offer of a contract to a physician means the practice or hospital wants you! Total passivity about the negotiation of the employment contract will only lead the practice or hospital to conclude that the physician doesn’t care enough about contract terms which are important to the practice or hospital, or alternatively doesn’t care about securing contract terms- not in the initial contract -which would be favorable to the physician. A bad contract can leave money on the table, result in a bad marriage of sorts, and set your career on the wrong trajectory.
Employment Considerations For Physicians
There are many considerations that factor in the decision to enter into a physician employment contract. The physician-employee must consider the geographical location of the practice, the personalities of the other physicians, the type of work he or she will be doing, the short- and long-term economic prospects for the overall practice, and the amount of time the position will leave for other professional and nonprofessional activities. A potential physician-employee should look into the long-term obligations of the group. For instance, are any of the doctors in the group planning to retire? Will the rest of the physicians be obligated with a large buyout?
Physician Employment Compensation
In determining whether to enter into a contract with a practice group the physician should examine the compensation offered, including:
- Base Salary
- Relocation Allowance
- Sign-On Bonus
If a sign-on bonus is not included in the initial offer, the physician should definitely ask for one. A sign-on bonus can range from $10,000 to $125,000 depending on the physician’s specialty, years of experience, and other factors. A relocation allowance covering the cost of movers, the cost of travel and meals incurred in house-hunting, and a temporary housing allowance should also be requested.
It is not uncommon for a practice’s initial offer to provide that the sign-on bonus and/or relocation allowance must be repaid in full if employment is terminated before the agreement’s initial term ends. More reasonably, the physician should ask for the “amortization” of the repayment obligation. That is, the physician should only have to repay a fraction of the sign-on bonus based on the fraction of the time that the physician does not work for the practice during the initial period.
Additionally, the physician should not have to repay the sign-on bonus or relocation allowance if (i) the Practice terminates the physician’s employment without cause, (ii) the physician terminates the contract because the Practice breaches the contract terms, of if the contract is terminated because of the physician’s death or disability.
MGMA Compensation Analysis
Physicians, through their physician employment contract lawyer, should examine what the Medical Group Management Association (“MGMA”) compensation analysis reveals about physician compensation, including academic compensation, paid continuing medical education (“CME”), as well as such things as call coverage requirements. There are multiple other data points which can be examined, and used in negotiating the physician’s contract.
Private practices may offer a physician what others were offered when they joined the practice several years ago. This, of course, is not reasonable. By offering objective MGMA data that was not considered by the practice at the time it developed its offer, the practice may be reasonable and willing to factor the objective data into a revised offer.
Additional Contract Negotiation Questions
In contract negotiations questions can also arise with respect to the term of the agreement. The following are all areas that an experienced physician employment contract lawyer can make sure are addressed.
- Clinical and Administrative responsibilities of the physician employee
- Professional Liability Insurance
- Pay Down of Student Loans
- A Covenant not to compete after the termination or expiration of the agreement
- Discipline and Discharge
- Call Coverage
A 1- year term contract, terminable “with or without cause,” leaves the physician highly exposed to sudden and unexpected termination, which could then trigger a “noncompete” provision preventing the physician from continuing to provide services for another practice in the same geographic area. “No cause” termination provisions need to be resisted, and the physician needs to approach short-term contracts with “noncompete” provisions very carefully.
It is important to understand the scope of your duties and responsibilities. Are you expected to engage in heavy administrative or community service responsibilities?
Professional liability insurance is an important, yet often overlooked provision. Is the insurance “occurrence” or “claims-made” coverage? What are the per occurrence and aggregate limits of coverage? Will the practice purchase a “tail” policy, or is that an expense the physician will have to absorb? The physician needs an attorney experienced in such matters in order to avoid a costly mistake.
Many contracts provide that the physician is expected to take “call coverage,” without stating how call coverage will be assigned. The physician should negotiate reasonable call coverage, including weekend calls. The MGMA publishes benchmarks for call coverage in various specialties.
Physicians Rights In Regard To Patient Records
Physician contracts often provide that the patient records are owned by the practice rather than the physician. This is reasonable during the term of the physician’s employment. However, the treatment of the records post termination of employment can be problematic. Some contracts provide that the records of patients who wish to continue to be seen by the physician will be transferred “at the physician’s expense,” notwithstanding the fact that most practices do not charge patients for copies of their records. The physician should try to negotiate a provision that patients may request that their medical records be transferred to their physician’s new practice, at the patient’s expense. The physician should also be given the right to free access to patient records necessary to defend medical malpractice or peer review action.
Why Hire Physician Employment Contract Lawyer Barney Cohen?
Given the breadth and complexity of physician contracts, and the fact that they govern a hospital or medical group’s professional relationship with physician-employees, it is important to handle physician contract review and negotiations carefully.
The failure to draft and analyze the employment agreement with a critical eye can lead to several landmines down the road, including unfulfilled expectations, disgruntled employees, and litigation over the terms of the agreement.
The physician should engage a knowledgeable physician contract review lawyer who will be an advocate for you in the contract negotiating process.
Barney Cohen contributed to the writing of the “American Medical Association Annotated Model Physician Employment Agreement.” Mr. Cohen has written and negotiated numerous physician employment contracts for newly minted and established physicians. As a physician employment contract lawyer, He works closely and personally with his clients drafting, reviewing and negotiating employment contracts that include complex compensation packages, buy-ins, retirement benefits, disability benefits and restrictive covenants. Mr. Cohen personally ensures that his clients’ employment contracts are legally sound and just.
If you are a physician in need of an experienced physician employment contract lawyer anywhere in the United States, from New York to Los Angelos, Seattle to Miami, Chicago to Houston, Denver to Boston or Washington DC and all cities in between the Healthcare Law Firm of Concierge Healthcare Attorneys, LLC is here to serve you.