The Length, Complexity & Negotiability of Physician Employment Agreements

In the world of physician Employment Agreements, there are many aspects that are the same or similar across the board – regardless of the Employer’s location or entity type – but there can also be a great deal of variation. The length and complexity the Agreement is one factor, which coincides with how comprehensive it is, but there are also many aspects to consider in terms of which terms and provisions the Agreement contains, what aspects of the employment relationship are assumed or incorporated by reference, and finally – the overarching consideration – of whether the Agreement is “negotiable.” This blog will break down what exists out there, on all points of the spectrum, and what I often observe as a physician contract attorney.

            In a Twitter poll conducted by Joe Wolf, a partner in the healthcare division of Hall Render, physician respondents replied to his poll question regarding the length of their Employment Agreements. That poll found that approximately 40% of physicians have an Employment Agreement that is between 11 – 20 pages long. Another 25% said their Agreement was more than 20 pages, and the remaining respondents had an Agreement of five pages or less. While these responses were similar to what I see in my practice, I would note that a larger majority of my clients (about 60%) have an Agreement in the 15-20 page range. Regardless of the specifics, the point is obvious – physician Employment Agreements are not brief. They are not term sheets with certain aspects of employment relationship bullet-pointed. On the contrary, they are fairly long and long-winded, containing a great deal of complex language and details concerning both parties’ obligations and responsibilities pursuant to the employment relationship. And more, they are of course legally binding documents and must contain certain pieces of language and provisions in order to exist as a valid and enforceable contract.                            

On one end of the spectrum are the most robust of Employment Agreements, often used by large health care systems, which contain almost every provision imaginable and aim to embody every conceivable aspect of the employment relationship. On the other end of the spectrum are Employment Agreements that contain only the most straight-forward and important of employment details, such as the termination provisions and compensation method, while merely referencing other policies and procedures, which are intended to be incorporated by reference. For instance, such an Agreement might make reference to the Employer’s benefits policies, its Intellectual Property Policy, the entities’ Rules, Regulations and Bylaws, and/or the Call Responsibilities and Schedule. In these instances of incorporation by reference, it is important to remember that the entirety of the employment relationship will be made up of all applicable terms and policies, whether or not they are actually contained within the pages of the Employment Agreement.

            In serving physician clients, I often hear, “My Employer already told me that my contract isn’t negotiable.” So, is that case? Are Employment Agreements negotiable and subject to revision based on the physician’s requests? The answer, of course, is that it depends. Very broadly, I will say that in my experience, most Agreements are negotiable in at least some ways. By that I mean that in even the strictest of settings, such as an academic institution, it may be possible or even likely to successfully negotiate a couple aspects of your employment, while leaving the content of the Agreement uniform. For example, clients are often able to successfully negotiate adjustments to items like their Compensation or their Signing Bonus, despite being told the Agreement was “non-negotiable.” In those instances, what the Employer likely really means is that they will not adjust the language of the Agreement itself, or amend the scope of their Non-Compete, for instance.                                                                                                                        

As mentioned above, this strict approach and need to have their Employment Agreements very static and uniform for all physician-employees is most common in the academic setting. This is also frequently the case with large hospital systems that desire uniformity and stand by their efforts to not make any adjustments “for any one employee.” However, as with most rules in life, there are always exceptions. For instance, I recently worked with a physician who was re-negotiating a renewal to his contract with a large health system. He works in a highly specialized field and is revered for his immense experience and long-term success. In that scenario, he was able to dictate a number of adjustments to his contract, to both the content of the contract itself as well as his compensation method, because the hospital was not willing to lose him. In other words, he had very strong bargaining power.                                                                                     

Another frequent question I get relates to who will do the negotiating on a physician Employment Agreement. Most commonly and most appropriately, it is usually the entity’s legal counsel that engages in the negotiating process. However, in some situations it is a practice manager or CEO who negotiates directly with the potential physician-employee. And often, it is a combination of both. In these instances, it may be a practice manager who is the decision-maker regarding a physician’s specific duties and which location(s) they serve, and then it is the attorney who has to make the call regarding whether the Non-Compete or Termination provisions can be adjusted. In either case, it is important for physicians to understand their right - and arguably their duty - to be represented by counsel in the negotiating process. Not only should physicians exercise due diligence in ensuring they are making informed decisions in the process, they should seek representation in order to level the playing field. Employers invariably have more power in the employment relationship, and the fact that they (or their attorneys) are the ones that drafted the Employment Agreement means that the playing field is inequitable from the get go. The only way to make a fair and informed decision about entering into a contractual relationship is to be appropriately represented by legal counsel.

            The attorneys of Lauth O’Neill Physician Agency are experienced and able to guide you through this process.

Access to Healthcare in Rural Areas: Particular Challenges and the Providers Who Serve Them- Part 2

Our last post highlighted the particular challenges that rural residents face in obtaining basic, essential healthcare. In many cases, the problem lies in the very simple fact that healthcare providers are too far and few between, making it a logistical nightmare for people to see a doctor. While the problems are well-documented and on the radar of many, what – if anything – is being done to alleviate these struggles? Who will fill the gaping holes that exist in the availability of healthcare? 

To be clear, it is not just highly-trained specialists that are lacking in rural communities. Rather, providers of all kinds and backgrounds are under-represented in rural areas. All areas of care – from dentists to psychiatrists – are grossly under-represented, which is not surprising considering that rural physicians comprise only about 9% of all practicing physicians. Filling these gaps is not only an issue of initial hiring, but also of retention. 

Healthcare organizations and experts tend to focus on monetary incentives when considering ways to induce providers to rural areas. These incentives include not only significant regular pay, but also things like loan payoff arrangements and sizeable bonus payments. Essentially, relying on the lure of flashing dollar signs to get providers to even consider joining the hospital or group in the first place. For many physicians with crippling student loan debt and young families to look after, this is a legitimate inducement, even if it means relocating to an area they may have never considered before. However, these beneficial financial arrangements solve only the first conundrum of hiring, and do not generally solve the issue of long-term retention. So how to get providers to not only moveto rural communities, but also to stayput?              It appears that the most effective strategy lies in pursuing candidates who will appreciate the lifestyle advantages offered by practicing in a rural setting, of which there are many. To begin with, there are many lifestyle factors that simply are not available in urban settings. For individuals who value the activities and opportunities presented by the great outdoors, many of our country’s rural communities offer enticing advantages. Hiking, horseback riding, boating, mountain biking, rafting and countless other activities are typical pastimes available any day of the week in many rural areas. Whereas for most of us, participating in such activities would require a special excursion – likely requiring a flight, a hotel stay and at least a full weekend away from home at minimum – residents of rural areas can partake in those activities any day of the week. A rural setting also might offer an attractive lure for parents of growing children. Children raised in a rural setting may have a completely different outlook on life, community, the importance of spending time outdoors being active, and the comfort, safety and reliability of a close-knit community – all of which are life lessons that cannot necessarily be taught, but rather must be experienced first-hand.         

For practitioners who are more concerned with career-focused inducements to residing in rural areas, those exist as well. Physicians in rural communities have greater autonomy in general. Based simply on the fact that there are fewer providers to go around, physicians are often in the position to practice areas of medicine they wouldn’t otherwise see in an urban setting that is swarming with specialists of all types. Whereas in an urban setting a particular case might be sent immediately to a specialist, a physician in a rural setting would likely take on the case herself. This allows (and requires) the physician to use a much greater amount of the broader knowledge and information she’s been taught throughout her career, versus being pigeon-holed into only working on a very specific type of case. Finally, rural physicians generally have the benefit of getting to exercise a more holistic, patient-centered approach to medicine, as they are allowed more time with each patient, thereby enabled to provide more comprehensive care. 

The benefits are varied and many, and physicians of all ages, experience levels and specialties are well-advised to consider the career opportunities available in our nation’s rural communities.

Physicians, Pro Athletes, & Musicians Alike- All Benefit From an Agent

I founded Lauth O'Neill Physician Agency because my professional and personal experiences taught me there is a need for physician agents.  Not only do physicians benefit from having someone in their corner, looking out for their interests, but they also need a "go to" person who can take on many of the tedious tasks that come in searching for a new job.

In my experience as a health care attorney, and combined with being married to a physician, I have naturally crossed paths with many physicians.  Many of them are at the beginning of their careers, and once they receive a job offer, they often ask me if it is necessary to have a lawyer look at the employment agreement.  My answer is always a resounding "YES!" And often times, I perform the legal analysis myself.  I have worked on both sides of physician employment.  And after serving hospitals and other group practices as my clients, I am acutely aware of what employers do to make a physician employment contract extremely favorable to themselves.  This, of course, often means the contract is unfavorable to the physician in certain ways.  Not to mention, they almost never offer compensation and benefits at the levels trained physicians can expect based on national benchmark data. So yes, the need for physicians to have their employment offers reviewed by a lawyer has always been very clear to me.

What I had not experienced until recently was the immense amount of time and effort that goes into finding and securing a physician's ideal employment arrangement.  In assisting my husband in his recent job search, I gained an intimate understanding of numerous steps that go into a successful physician job search.  First, locating the opportunities that fit your professional desires, then communicating with the potential employers to let them know you're interested and qualified, and interviewing multiple times with the same folks- this is only the beginning of the process.  Once an offer is made, then the hours spent on this task really start to climb.  Physicians not only need a legal review of each offer completed, but they must also endure what seems to be endless back-and-forth with the potential employers to ensure they receive the compensation, benefits, and terms they have earned.

In talking with my husband's colleagues about the trials and tribulations of their job search processes, the rhetorical question has often been posed: "Can't I just pay someone to do this for me?"  I only had to hear that question once before I recognized the need for physician agents.

As a physician agent, it is my goal to do all that is necessary to make my clients' job search not only successful, but as little of a burden to them as possible.  Therefore, I provide our Premier Opportunity service so that physicians can simply tell me what sort of job they are looking for, and in what region, and I will go to work finding their options.  Seeing the physician's job search process through to the end, the Premier Opportunity service includes every crucial step that allows physicians to find and shape their ideal employment arrangement.  I am excited to make each next clients' success my priority.