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Why is contract review vital for physicians?

On Behalf of | Feb 8, 2024 | Employment Law |

Beginning work with a new employer can lay the groundwork for a new and successful chapter of your career. However, physicians often fail to consider employment terms beyond compensation. Physicians should also carefully review and negotiate all terms of their employment contracts. Making mistakes during the review process can impact the future of a healthcare provider’s career, their finances, and their ability to dedicate time to their life outside of their work.

An employment law attorney who understands the intricacies of workplace agreements and of physician employment can help physicians navigate the details of these complex and often lengthy contracts. What questions should physicians ask when reviewing an employment contract, and how could an attorney help them navigate this process?

What kind of work does the contract require?

One of the first things to consider before signing an employment contract is whether the duties outlined in the contract are fair. Talking to physicians who are working for your prospective employer is always a good idea. A contract should address the work expected of you, as well as the support you will have to perform at your best. As the American Association of Family Physicians notes, you should also consider details like whether the contract allows time for administrative work.

Without thorough review, you may find yourself required to work additional hours to complete paperwork and/or provide community services. You may also find yourself doing work at additional locations requiring time-consuming travel or within a schedule that does not work for you. An attorney can help you identify potential issues or unclear terms and negotiate a fair arrangement.

What compensation will you receive for your work?

One of the most critical aspects of a physician’s contract is the compensation package. This includes the base salary, often an RVU calculation for enhanced compensation, and a time period for the base salary guaranty.  Additionally, fringe benefits, vacation (and the ability to take vacation), CMEs, insurance, etc. Clarity of the terms is essential as well as transparency for the data used to calculate your RVUs.

How could this contract limit your career both today and in the future?

Physicians contracts may contain a variety of different clauses that restrict your opportunities. They may restrict your ability to perform outside work. Non-compete clauses may limit your ability to work for other healthcare facilities in the area if you leave your position with your employer. These clauses can become especially complex as so-called “super groups” with broad geographic reach have become more common.

These clauses require careful review to ensure that the restrictions will not unreasonably limit your career. By reviewing the restrictions placed on you by your contract and negotiating fair terms, you can protect your career from unreasonable agreements.

What coverage does the contract offer if you face accusations of malpractice?

Malpractice insurance is a crucial element of a physician’s contract, however, coverage of tail insurance is often overlooked or is specified as conditional, depending upon the type of separation of employment.

Although no physician expects this to happen to him or her, many physicians are unfairly accused of misconduct, including when staff may make a complaint about the physician’s conduct.  Even when such an allegation is utterly without merit, many physician contracts then allow immediate termination without notice or opportunity to cure.  In some cases reports are made to the National Practitioner Data Base even when such reporting is improper or unnecessary.

For cause terminations, including those which are not justified but allowed under the employment contract, can be a career killer. 

What is not in the proposed contract is as an important as what is included

Often a prospective recruiter or manager for the new employer will make promises or representations to the physician as part of the hiring process.  However, when the physician receives the proposed contract, it normally includes a provision which voids any such representations not specifically included within the contract itself.

What are the terms for exiting your position?

Provisions for renewal, non-renewal, notice periods and the ability to work those periods without hiatus, are crucial. Some physician contracts require the physician to provide notice without putting the same responsibility on the employer.

By offering insights into these requirements, an attorney can help you to have a better employment situation and protect your career. Legal guidance can also help you identify potential pitfalls and address details that may create issues in the future.

It is important for physicians to remember that a contract is not a formality – it is a document that has the potential to shape or harm your career for years to come. Having experienced guidance as you review and negotiate the terms of your contract allows you to approach these important documents with confidence.