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Key Clauses in Physician Contracts To Be Aware Of

Physician employment contracts are legally binding agreements that define the terms and conditions of a doctor’s employment.

Understanding the key clauses in these contracts is crucial to ensuring fair terms, protecting your career, and avoiding potential disputes. This guide provides an overview of the most important clauses to review and explains their implications.

Compensation and Benefits Clauses

One of the most critical aspects of any physician contract is the compensation and benefits package. This section should clearly outline:

  • Base Salary: The guaranteed annual pay.
  • Incentive Pay: Bonuses based on productivity metrics such as wRVUs (work Relative Value Units).
  • Additional Compensation: On-call pay, stipends, or administrative duties.
  • Benefits: Comprehensive details about health, dental, vision insurance, malpractice coverage, disability insurance, and retirement plans.

Ensure that all verbal agreements made during interviews are documented in this section.

Non-Compete Clauses

Non-compete clauses, also known as restrictive covenants, limit where and how you can practice after leaving an employer. Key elements to examine include:

  • Geographic Scope: How far the restriction applies (e.g., within a 10-mile radius).
  • Duration: Length of time the restriction is enforceable.
  • Specificity: The types of medical services you’re restricted from offering.

Negotiate to narrow overly broad clauses that could unfairly limit your future opportunities.

Although it is possible to get out of non-compete clauses, we always suggest negotiating these up front to avoid potential issues.

Restrictive Covenants Beyond Non-Compete

In addition to non-compete considerations, there are also some key things to look for, such as:

  • Non-Solicitation Clauses: Prevents you from recruiting patients or staff after leaving.
  • Confidentiality Agreements: Prohibits sharing proprietary or sensitive information.

Understand how these covenants could impact your ability to transition to a new role, otherwise you might have an issue on your hands without realizing it.

Our team is specially trained in spotting these covenants, and offer a wide variety of legal services to make sure that you are protected.

Termination Provisions

Termination clauses dictate how and under what circumstances your employment can end. Look for details such as:

  • Termination With Cause: Reasons an employer can terminate your contract, such as breaches of policy or unprofessional behavior.
  • Termination Without Cause: Allows either party to end the contract without a specific reason, typically with a notice period (e.g., 90 days).
  • Cure Period: Time allotted to rectify issues before termination.

Be cautious of inequities, like requiring a longer notice period for you than the employer.

Duties and Responsibilities

This section should comprehensively describe your expected duties and responsibilities, including:

  • Scope of Practice: Type of medical care you’ll provide.
  • Workload: Patient volume, hours, and call schedules.
  • Location: Where services will be rendered (e.g., clinic, hospital, multiple sites).

Ensure the contract aligns with your expectations and career goals.

We also specialize in Career Planning, including long-term goal setting, interview prep, and more.

If you’re in doubt about your career in the medical field, talk with one of our trusted advisors.

Malpractice Insurance Requirements

Malpractice insurance is vital for protecting against legal claims. As a doctor, this is one of the most important ways to protect yourself against practice-related issues.

Contracts should specify:

  • Type of Coverage: Claims-made vs. occurrence-based policies.
  • Tail Coverage: Who bears the cost if you leave the practice.

Discuss tail insurance coverage with your employer, as it can be a significant expense.

At Physicians Thrive, we offer a variety of malpractice insurance plans. Be sure to reach out to our team to find one that is great for your situation.

Start and End Dates

The contract must include:

  • Start Date: The official beginning of your employment.
  • Contract Term: Whether the contract renews automatically or requires renegotiation.

Ensure clarity on these dates to plan your career progression effectively.

Frequently Asked Questions

What is a non-compete clause in a physician contract?

A non-compete clause restricts where and how you can practice medicine after leaving an employer, typically based on geographic location and time.

Why is it important to review termination clauses?

Termination clauses outline how and when you can exit a role. Unfavorable terms can restrict your options or impose financial burdens.

Who pays for tail insurance in physician contracts?

Who pays for tail coverage varies by employer. Some cover the cost, while others require the physician to pay. Always clarify this during negotiations.