Physician Employment Contracts: What Really is in the Contract?

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One of the things we often hear in law school is that the terms of an agreement are dictated by the "four corners" of the contract. In other words, only what is literally contained within the four corners of the pages of a contract are included in the actual binding agreement. To many clients I work with, this news is somewhat surprising. In many cases, clients have been working with potential employers for months, going over the details of their physician employment contract, only to finally get a copy of the actual agreement and find that everything discussed has not been included.

This can be a very frustrating part of the contract negotiation process. By the time an agreement comes around, physicians are often very excited to be done with the process, and want to sign the agreement and be done with it. I always caution physicians to not be hasty in signing their employment agreements, and instead, be completely confident that any term they cannot live without is in writing, as part of the agreement. This can mean bonus compensation, special equipment or support staff promised, or even your family's health insurance benefits. If it's not set out in the agreement, the employer has no obligation to provide you with it.

Likewise, I often talk with physicians who have requirements in their contract they may not be readily willing to adhere to. For instance, the possibility of traveling to any office location the employer maintains. Often the employer will assure the physician employee that such language is merely standard, and they won't be required to actually follow through with many of these requirements. This may be true in some cases, but as long as the terms are included in the agreement, the employer will be in a position to enforce these duties and responsibilities.

Therefore, it is very important that physicians have a thorough understanding of what their employment agreements are offering them, and what they're requiring them to do. Only then can the physician make a truly informed decision in accepting an employment agreement.

For more information on physician contract review and negotiation issues, please contact Leigh Ann O'Neill at 317-989-4833 or loneill@lauthoneill.com.

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Physician Employment Contract Negotiation Tip: Look Out for Practice Location Terms

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In a time of decreasing reimbursement rates, it is becoming more and more popular for hospital systems and some larger private physician groups to open rural clinics and other types of practice sites. This trend is on the rise because reimbursement rates tend to be better in rural areas, and other regulatory rules are often relaxed for rural health care providers. Due to the influx in rural clinics and practice sites, physician employers are obviously faced with who will staff these additional locations. Of course, many employers simply hire physicians to work only in these rural locations, but other employers are staffing the locations with their physician employees who work the majority of their time in more urban practice locations.

Because it is often more difficult to find physicians who are willing to work only in the rural locations, the employers are faced with ways of staffing the rural practice sites with their urban physicians, and many times it ends up being the more junior physician employees who are called upon to commute to the rural locations on occasion. With this increasing trend, it's not surprising that many physician employment contracts these days are coming with provisions that require the physician to provide services at "any practice location the Employer owns or provides services." This is becoming one of the classic contract provisions that seems harmless and just like any other "standard" contract language, but it can bring significant discontent on the part of the physician once the job actually begins. While the physician employment contracts should always stipulate an actual address of the office location where the physician will be providing services, physicians should be weary of this additional "catch-all" sort of language that may require them to provide services at other office locations that may not have been specifically set out in the contract.  Keeping an eye out for this type of vague language and amending it to provide only specific requirements on the part of the physician is always a good idea so that the physician can begin his or her job and be confident there are not any unwelcome surprises down the road.

For more information on how Lauth O'Neill can assist in your physician job search or physician employment contract review, please contact Leigh Ann at 317-989-4833 or loneill@lauthoneill.com.

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Physician Contract Reviews: Keys to a Good Deal

In my years as a health care lawyer, I have reviewed many physician employment contracts for clients. I have also worked for hospitals and other employers in drafting the offers they make to physicians. This experience has given me the benefit of knowing both sides' angles in this process. After a long and laborious job search process, the acceptance of a physician's first employment offer is often a foregone conclusion. Unfortunately, not only do many physicians take the first set of terms offered to them, but many physicians do not seek legal advice at all.  After seeing how incredibly different the second version of a contract can be from the first, I cannot urge physicians enough to hire someone to do this important work on their behalf.

The makings of a good and fair physician employment contract include balanced terms, fair market value compensation, and benefits such as health, life and disability insurance, and reimbursement for various typical business expenses. Of course this list is not inclusive, but only mentions some of the points a physician lawyer will be looking for when reviewing an employment agreement.

The "take-home" point for physicians, especially those straight out of residency or fellowship, is that having a legal review of your employment offer will pay for itself many times over.  New physicians often don't take advantage of the bargaining power they have, and a formal legal review can provide exponential benefits.