Physician Contract Negotiation: False Assumption

Don’t assume you cannot negotiate physician contracts

Most physicians who are finishing their training assume they will have little to no chance at negotiating with a potential employer. Seasoned physicians know from experience this is not true, even for first timers. Don’t get fooled by the employer’s first line of defense…”this is a standard physician contract…the same one we give everyone else…it is compliant with current state laws…and it will not be modified.”

Employers have standard physician contracts for most new employees because of consistency and it enables them to manage their employee relationships efficiently. At the same time, there are always provisions that can be modified to meet the needs and wishes of the new physician. One of the growing trends around the country is an employer’s desire to engage in the “best practices” of “retaining” their physician employees.

Physician employers suffer from a high turnover rate of about 50% for physicians employed less than three years and 60% for less than five years. There is a significant price tag associated with losing these doctors. There is an investment of time and resources in each physician and when a one leaves, especially in the earlier years, this causes a financial loss since the new physician has not been employed long enough to generate profit for the group. Employers recognize this and they are making adjustments, even in the physician contract negotiation stage, so that a better relationship is forged that should last more than the typical short-lived employment.

There are certain steps physicians can take to put themselves in the best position to be able to negotiate. The first step is finding out where problems exist in the physician contract. They could be problems due to typos, inconsistencies, being out-of-date with current state laws, ambiguity or language does not reflect what was communicated during interview stage or initial physician contract offering. The best way to sort all of this out is to have a lawyer who is a physician contract expert review the physician contract and consult with you to reconcile what the physician contract stipulates to what the recruiter says about the position. Utilize an attorney who has extensive experience with physician employment agreements and works with them on a regular basis; a lawyer who is familiar with current laws and issues in the state where the employer is located.

Take caution when engaging an attorney. Make sure the attorney’s approach to physician contract review and negotiation is going to be conducive to fostering a good working relationship with the employer. Having the lawyer involved too aggressively from the beginning could be viewed as confrontational and cause you to lose a good offer. For more about access to physician contract experts, check out our Physician Contract Review and Negotiation page.

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