Seeking The Counsel of a Physician Contract Attorney Can Ensure Your Contract Is Legally Sound
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. If Barney can help you, call him now for a free consultation at 312-804-1739 or send an email to: barney@conciergehealthcareattorneysllc.com
The secret that physician employment contract lawyer, Barney Cohen, wants to share with you is that ALL physician contracts are negotiable.
About Physician Contract Agreements
At some stage in their careers, the majority of physicians are likely to be party to a physician employment contract or independent contractor agreement. This contract formalizes the working relationship between the physician and the employer, which may be a group practice, hospital, academic institution, or other healthcare provider. The employment contract typically outlines the physician’s responsibilities, compensation, and benefits, as well as other terms such as non-compete clauses, termination policies, and malpractice coverage. Understanding the terms of these contracts is crucial to protecting your interests.
Why Does a Contract Need to Be Reviewed?
It is tempting to think that once you have the employment contract or independent contractor agreement in hand, the hard part is over. After all, you have gotten the job, and likely been offered some good compensation and benefits. This sort of thinking is a mistake for a medical professional, however, even if you have carefully reviewed the terms and think it sounds like a good deal. Failure to critically analyze the employment contract or independent contractor agreement can lead to significant pitfalls, including unmet expectations, dissatisfied employees, and potential litigation over the contract’s terms. While physicians are highly intelligent–and may have some understanding of physician contract terms as they move through multiple stops in their career and review contracts–those terms should still be reviewed by a physician contract attorney.
What Things Should Be On My Radar As I Review My Contract?
Each physician contract is unique, with terms included in one contract and not another due to the physician, medical practice, or other factors. However, there are some general things that a physician should be aware of when considering an employment contract.
Compensation
For any contract, compensation is at or near the top as the most important issue to prospective employees, physicians, or otherwise. As a physician, however, you want to have information not only about how much you are going to be paid but how this is going to be calculated. This can sometimes be vague–intentionally or not. Be sure to spell this out in the contract.
Many physicians are concerned about whether they are being fairly compensated. Physicians should work with their physician contract lawyer to review what the Medical Group Management Association (MGMA) compensation analysis shows about pay trends, including academic salaries, continuing medical education (CME) stipends, and call coverage requirements. There are many other data points from MGMA that can help with contract negotiations, too. By presenting current MGMA data that the practice may not have considered when making its initial offer, it might be more open to adjusting the offer to reflect objective, up-to-date information.
A compensation package typically includes:
- Base Salary: The guaranteed salary that forms the foundation of the compensation structure.
- Benefits: Such as health insurance, retirement plans, continuing medical education allowances, and paid time off.
- Relocation Allowance: Covering costs like movers, travel, and temporary housing for house-hunting.
- Sign-On Bonus: If this is not included in the initial offer, physicians should request one, as bonuses can range from $10,000 to $125,000, depending on specialty, experience, and other factors.
You will also want to be careful about sign-on bonuses and relocation bonuses. It is common for these amounts to come with repayment obligations if the contract is terminated before a certain point. If the physician leaves the practice early, they would only repay a proportional amount based on the time remaining in the contract’s initial term.
While this might seem reasonable, it can also be onerous for the physician. Suppose the practice terminates employment without cause, the physician ends the contract due to the practice’s breach, or the contract is terminated due to the physician’s death or disability. It does not seem fair that the physician would have to repay in those instances. Properly structuring these terms can create a more secure, fair, and beneficial employment relationship.
Call Coverage
Many physician contracts stipulate that the physician is expected to take “call coverage” but often fail to specify how that coverage will be assigned or what the expectations entail. It is crucial for the physician to negotiate reasonable terms for call coverage, including the frequency of weekend calls and how the workload will be shared among the medical staff. Clarity on these points can help prevent misunderstandings and ensure a fair distribution of responsibilities. To aid in these negotiations, the MGMA publishes benchmarks for call coverage across various specialties, providing valuable data on typical practices and expectations. Utilizing these benchmarks can strengthen the physician’s case for a more equitable call schedule and help ensure that their workload is manageable.
“No Cause” Termination Provisions
The terms “no cause” or “without cause” in physician employment contracts refer to the ability of either party—the physician or the employer—to terminate the contract without needing to provide a specific reason. It is crucial for physicians to carefully review and negotiate the terms surrounding “no cause” termination. They should ensure that the notice period is reasonable and that other provisions, such as compensation and benefits during the notice period, are clearly outlined. Generally, such terms should be resisted.
Non-Compete Provisions
Non-compete provisions in physician employment contracts are clauses that restrict a physician’s ability to practice medicine in a certain geographic area for a specified period after leaving a practice. While these provisions aim to prevent former employees from taking patients or confidential information to a competing practice, they can significantly impact a physician’s career and mobility. Non-compete clauses define the duration, geographic scope, and type of medical practice the physician is restricted from joining. Physicians should negotiate these provisions before signing an employment contract. They can seek to limit the duration and geographic scope of the non-compete or request the inclusion of carve-outs for specific situations.
Professional Liability Insurance
Professional liability insurance is a crucial provision in physician employment contracts. Physicians need to determine whether the coverage is “occurrence” or “claims-made,” as this distinction can affect future liability. It’s also essential to review the per occurrence and aggregate coverage limits to ensure adequate protection in the event of claims. Additionally, the contract should clarify whether the practice will cover the cost of a “tail” policy upon termination, or if this is an expense the physician will have to bear. Consulting with a physician contract attorney who has experience in these areas is vital to avoid potentially costly oversights and to ensure comprehensive coverage is in place.
Rights Regarding Patient Records
A very overlooked question that arises in the context of physician employment contracts regards rights to patient records. Physician contract agreements often state that patient records belong to the practice, not the physician. However, issues can arise over what happens to those records after employment ends. Some contracts require that patient records be transferred “at the physician’s expense” if patients want to keep seeing that physician, even though most practices do not charge patients for copies. The physician should try to negotiate a clause allowing patients to request their records be sent to the physician’s new practice but at the patient’s expense. Additionally, the physician should ensure they have free access to any records needed to defend against malpractice or peer review actions.
What Should Physicians Consider Outside of The Terms of the Contract?
There are a lot of factors to think about when deciding to sign a physician employment contract. The terms of the contract are paramount. However, there are other things that a physician should consider. They are:
- Colleagues’ personalities and overall fit with the medical practice
- Location of the practice
- Medical practice’s financial outlook (both short- and long-term)
- Type of work that is involved
- Work-life balance
Won’t I Look Bad If I Ask to Negotiate?
Many physicians express concern regarding how a practice will respond to their request to have a physician contract attorney review their contract. One thing to keep in mind is that if you have been offered a contract, you know that the medical practice is interested in employing you. Additionally, it is not unusual for physicians to review their contracts. Your employer has likely had this request for negotiation previously. Additionally, by not reviewing the contract, you might inadvertently convey that you are indifferent. Besides this impression, you can leave a lot on the table without having a physician contract attorney look over your contract before you sign. A poorly negotiated contract can result in lost financial opportunities, foster an unsatisfactory working relationship, and adversely affect the trajectory of your career.
Hire an Experienced Physician Contract Attorney
Given the complexity and wide-ranging scope of physician contracts—and the critical role these agreements play in defining the professional relationship between a hospital or medical group and its physicians—it is essential to approach contract review and negotiation with care. Physicians should consider enlisting the support of an experienced physician contract lawyer who can serve as a knowledgeable advocate throughout the negotiation process. This attorney can help identify terms that may be unfavorable or overly restrictive, ensuring the contract aligns with the physician’s long-term career goals. By working with a physician contract attorney, physicians can enter into employment agreements with greater confidence, knowing that their interests and career objectives are well-protected.
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 Angeles, 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.