Physician Employment: Protection from Issues Posed by Co-Terminus Clinical Privileges Language
Our healthcare and business law firm often assists physicians and other providers in employment matters, from reviewing proposed contracts to litigating non-compete matters. We’ve written previous material on physician employment, including Keys to Negotiating a Good Contract and Physician Non-Compete Agreements. As mentioned in our previous post, our firm has recently been dealing with issues raised by co-terminus language, or language providing that a physician’s hospital clinical privileges automatically terminate when the employment contract is terminated. The previous post provided an overview of co-terminus language and potential issues raised by such language. This post focuses on possible ways a physician can protect herself or himself from those issues. If you have NPDB or employment questions or would like to discuss this blog post, you may contact our healthcare and business law firm at (404) 685-1662 (Atlanta) or (706) 722-7886 (Augusta), or by email, email@example.com. You may also learn more about our law firm by visiting www.hamillittle.com.
Although there may be many ways for a physician to protect themselves from the issues posed by co-terminus language (which issues we detailed in our previous blog post available here), below are a few ways we have dealt with in the past, some in the contract negotiation phase and others are actions to take after employment has ended. Note, these actions do not insulate a physician from issues, but rather add protections to try and reduce the chance that the physician is met with problems relating to clinical privileges.
- Contract Negotiation Phase
One option is to modify the co-terminus provision to change what happens when your employment ends. Essentially, the physician will voluntarily resign privileges at the end of employment as opposed to privileges being automatically terminated. Although voluntarily resigning clinical privileges may still be reportable if the physician is under investigation for professional incompetence or clinical competency concerns, this change in the language may avoid the main issues raised by the co-terminus language. Such language may look something like:
“Physician agrees that upon termination of employment with Company, whether by voluntary or involuntary separation or any reason whatsoever, Physician shall thereupon resign and be deemed to have resigned from the medical staff of facilities at which Physician was a member for purposes of this employment.”
Another option is to modify the co-terminus provision to make it expressly clear that the termination of privileges pursuant to the co-terminus language is not an adverse action that is reportable. Sample language to incorporate into the employment agreement may look something like the following:
“Termination of Physician’s Medical Staff membership pursuant to [the co-terminus provision] shall not, by itself, be considered an adverse action against Physician’s clinical privileges and thus will not be reported to the National Practitioner Data Bank; provided, however, that nothing in this Agreement shall be construed to prevent, limit, or restrict the medical staff from taking action against Physician’s clinical privileges in accordance with applicable medical staff bylaws.”
Still another option is to modify the language so that there is no co-terminus language. Rather, the provision would provide as follows:
“The termination of this Agreement by either Party shall not, in and of itself, affect a termination of Physician’s appointment to and membership on the Medical Staff.”
Assuming the physician has the standard co-terminus language, there are ways to avoid ditches dug by this language even when employment was terminated as cause for clinical competency concerns or professional misconduct. Often times, employment contracts and future privileges applications ask whether a physician has ever had their privileges revoked, terminated, or lost for any reason, whether voluntary or involuntary. Our advice is always to be transparent in responding to any questions, however, sometimes our clients will offer more than they need to in response to these questions. We recommend seeking advice from counsel when answering such questions and navigating the complexities of this situation. It can help to examine the medical staff bylaws to see what makes a physician ineligible for privileges at the facility, and that can guide you and your counsel on what the facility is seeking out when you provide your explanatory response to the “yes” answer.
Another guidance point is to monitor your NPDB report if you’ve been terminated for cause and had your medical staff privileges automatically terminated as well. If the facility submits a report to the NPDB in this situation, you may have arguments to challenge such a report. We recommend seeking advice from counsel if you are in this position.
If you have NPDB or employment questions or would like to discuss this blog post, you may contact our healthcare and business law firm at (404) 685-1662 (Atlanta) or (706) 722-7886 (Augusta), or by email, firstname.lastname@example.org. You may also learn more about our law firm by visiting www.hamillittle.com.
*Disclaimer: Thoughts shared here do not constitute legal advice.