Physician employment: 4 tips for successful contract negotiation


More and more, physicians are moving away from independent practice and gravitating toward employment with hospitals or other large organizations. Although this switch frees doctors of the burdens of running a business, it's critical physicians understand their rights and responsibilities before agreeing to an employment contract.

To help physicians better prepare for this process, FiercePracticeManagement spoke with FierceHealthcare advisory board member William Cors, chief medical quality officer of Pocono Health System in East Stroudsburg, Pa., and Dean P. Nicastro, a healthcare attorney with Pierce & Mandell in Boston. These experts offer you the following 4 tips for negotiating a satisfying and surprise-free physician employment contract.

1. Begin negotiations with your offer letter.
Before a physician candidate ever gets an employment contract to review, the potential employer sends him or her an offer letter. The physician is then asked to sign and return this letter, which not only outlines basic details of the position, but it also commits the physician to sign the employer's standard form of contract, Nicastro said.

"In most jurisdictions, an offer letter is a contract. What many physicians don't realize is that the ability to leverage and negotiate change to the standard form of contract is limited by what they agreed to in the offer letter," he said. "In an ideal world, if you're ever going to talk to a lawyer, you should do it when the offer letter arrives rather than waiting until you get the contract."

On the flipside, remember that anything you were promised verbally holds no legal weight, so be on the lookout to make sure the written provisions match what you were told, Nicastro added.

2. Read and appreciate what you're signing.
When physicians end up dissatisfied with the contract terms they agreed to, Cors (pictured) said they likely didn't read the contract closely beyond learning how much they would earn.

"Once you get beyond the base compensation and the basic core group benefits, there's probably room for misunderstandings at every step of the way in the contract," Cors said.

Even when physicians do understand the terms of a contract, they may have a tendency, during the courtship process with a potential new employer, to overlook the magnitude of some provisions under the idea that they'll never come into play, Cors added.

"I've seen two extremes," he said. "One is not reading or thinking, 'This isn't a big deal.' The other is that you get a lawyer and question every blasted section in the contract. There has to be some give and take."

In other words, make sure you understand and are comfortable with what you're signing, but don't try to demand an unreasonable number of changes.