Physician Employment Agreements

Physician Employment Agreement

Our business and healthcare law firm represents physicians who are considering employment agreements with hospitals or other potential employers. We have represented doctors for more than a decade and can guide you through the intricacies of physician employment agreements to ensure the best possible outcome for you.

Atlanta Healthcare Attorneys

The focus of our law practice is representing healthcare businesses. We have substantial experience representing healthcare providers and can assist you in evaluating, drafting and/or negotiating your physician employment agreements.

How we help doctors considering employment

Our representation of doctors with regard to employment agreements typically involves:

  • Pre-drafting considerations
  • Evaluation of independent contractor options
  • STARK analysis
  • Compensation and expense reimbursement
  • Dispute resolution provisions
  • Termination and due process
  • Non-compete agreements and other restrictive covenants

We also represent physicians who sell an existing medical practice and become employed by the purchasing hospital or physician group. A proper employment agreement defines the legal relationship between the physician and his employer. It must clearly and precisely state the parties’ expectations and their respective rights and obligations.

Georgia and South Carolina physician employment agreement lawyers

If you are a doctor considering an employment agreement, our firm can help you avoid mistakes in the contracting process and avoid surprises down the road about compensation and other critical aspects of employment. We help physicians identify critical, long-term personal and professional factors impacted by specific contract language contained in proposed employment agreements and other contractual arrangements presented by hospitals, hospital systems, medical group practices and other potential employers. Our firm will negotiate for (or assist our clients in negotiating for) important contract language that we know will protect a physician’s long-term financial and career interests.

While compensation often is the driving consideration for physician review of a prospective employment opportunity, numerous other aspects of the written employment agreement will profoundly impact the physician’s satisfaction and happiness with the arrangement over the long term.

Essential Physician Employment Agreement Tips

Read and understand all provisions of a proposed employment agreement. While it sounds elementary and self-evident, carefully reading and understanding all aspects of an employment contract is often neglected. Without a true understanding of how all provisions in a proposed written agreement would operate, effective negotiations are not possible for a doctor. Physicians should not blindly accept any sentence in a proposed employment agreement. Most language can and often should be negotiated, to ensure it operates fairly. It is critical to take the time to dissect an agreement and understand what the implications of every provision are.

Know the proposed job. That is, know the job duties as contemplated by the specific particulars of the proposed written employment agreement (in contrast to what representations are made in general discussions).

  • What hours are required? Is there a minimum number of hours or particular hours required under the contract?
  • At what location(s) is the physician required to work?
  • What marketing, medical education, promotion, and/or administrative duties and services are required and are work relative value units (“WRVUs”) for those activities addressed in compensation provisions?
  • What are the specific “on-call” provisions and compensation details for such responsibilities?
  • Does the proposed contract require you to consult with other physicians requesting provisional services of the employer?

Obtain proper payment agreement. A typical employment agreement will contain assignment provisions for billing privileges; however, physicians have a legal responsibility for billing accurately. Therefore, your employment contract should allow them the opportunity to review billing claims as needed to ensure the bills are correct. A fair employment contract will also require the employer to indemnify and hold harmless the physician for any violation of the law as a result of the employer’s billing for the physician’s services.

Understand precisely how compensation is determined. Straight salary is increasingly rare. Production-based formulas (e.g., WRVUs) are intended to incentivize desired physician performance. From the physician’s standpoint, production-based formulas should clearly and precisely articulate the formula and any variables that impact the calculation of compensation. For complex formulas, the physician should make sure that examples are included in the employment agreement. Due to current trends in healthcare reform, compensation models for physicians will to some degree morph from “production” to “value”- based compensation methods as third party payers experiment with a variety of performance benchmarks or metrics associated with “value,” such as patient satisfaction, quality outcomes, adoption of electronic health records, performing recommended screenings, etc. The movement toward “value” measures by third-party payers is new and experimental. It is essential that the mechanics of the compensation formula be precise and clear and totally transparent.

Obtain adequate liability protection. Professional liability coverage can be “claims made” or “occurrence based.” If a proposed employment agreement provides that the employer will offer claims made malpractice coverage, the physician should consider requesting that the employer obtain (or cover the cost of) “tail” coverage (an extended reporting endorsement that extends coverage beyond expiration of the policy paid for by the employer).

Preserve professional judgment. Tension created by the role of employee and the independent professional judgment required of doctors is almost inevitable. Physicians must make sure that treatment and referral judgments are always according the best interests of their patients. When a physician signs a contract of employment, however, contractual provisions that bind the physician will necessarily impose certain restrictions, both express and implicit, upon the physician’s conduct respecting treatment and referrals. It is more than a theoretical possibility that the financial interests that drive a hospital’s inclusion of a contract provision can compete with what is actually in a particular patient’s best interests. Careful analysis and weight should be given to all provisions of a proposed employment agreement that restrict a physician’s judgment.

Plan for the end. All good things will end. A physician’s employment is no exception. In reviewing a proposed employment agreement, good feelings and optimism notwithstanding, an honest, critical assessment of all contract provisions relating to termination of the relationship is essential. Some factors to evaluate are:

  • What benefits are forfeited or lost at termination of employment (bonuses, hospital privileges, retirement contributions)?
  • What are the details of non-compete and non-solicitation provisions? Are those provisions reasonably crafted so that you can transition into new employment or private practice in the geographic area desired?
  • Does the contract allow the employer to terminate “for cause”? Does it provide you an opportunity to cure deficiencies? Do the contract’s provisions respecting termination ensure protection of the doctor’s due process rights?

Our law firm is focused on protecting the financial interests of physicians and other healthcare providers throughout Georgia and South Carolina. We are committed to helping healthcare businesses make and protect money.

“Kevin Little [of Hamil Little] represented the Medical Association of Georgia and individual physicians in a matter addressing the abuses of the health insurance industry. Kevin was a pleasure to work with and brought forth legal theories to hold the health insurance industry accountable to physicians and patients. We received outstanding representation from Kevin.” *

Donald Palmisano, CEO and General Counsel, Medical Association of Georgia.

Our attorneys have extensive experience and are AV-rated. Our firm has offices in Atlanta and Augusta, Georgia. Contact us at (404) 685-1662 (Atlanta), (706) 722-7886 (Augusta and Aiken), or info@hamillittle.com to schedule a confidential consultation.

* DISCLAIMER: Any result this law firm or any lawyer of this law firm may achieve on behalf of one client in one matter does not necessarily indicate similar results can be obtained for other clients.