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Group Practice: Contract Review

 

Physician Contract Review: Key Tips & Critical Considerations

A well-negotiated contract protects your career, finances, and work-life balance. A poorly reviewed contract can cost you thousands, limit your career options, and lead to burnout. Take the necessary time to negotiate and protect yourself. The following are key topics for you to consider if you're joining a group.

Read the Entire Contract: No Assumptions

  • Never assume anything is “standard.” Every clause impacts your future.

  • Identify vague language like “as needed” for call schedules and ask for specifics.

  • Ensure that verbal promises (e.g., guaranteed bonus, protected time off) are in writing.

Compensation: More Than Just a Salary

  • Understand base salary vs. productivity-based pay (RVUs, collections, net revenue). 

  • If bonuses (signing, productivity, retention) are offered, clarify payout terms and repayment obligations if you leave early.

  • Confirm how often compensation is reviewed and if increases are automatic or discretionary.

Benefits & Malpractice Coverage: Who Pays for What?

  • Ensure the malpractice insurance type is specified – either claims-made or occurrence-based.

  • If it’s claims-made, confirm who pays for tail coverage if you leave. An “extended reporting endorsement” (often referred to as “tail coverage”) protects your prior acts. Many employers require that you purchase tail coverage if you leave, which can cost 100-300% of the annual premium.

  • Confirm health, disability, and life insurance, CME stipend, relocation assistance, and retirement contributions.

Work Expectations: Be Precise

  • Define patient volume expectations. Are there penalties for low productivity?

  • Understand the on-call schedule. Is it evenly distributed? Paid? Excessive?

  • Ask about moonlighting. Is it allowed? If it’s restricted, try to negotiate exceptions.

 Non-Compete Clauses: Career Killer or Manageable?

  • Consider the geographic scope. How many miles from the current employer? 5-10 miles is reasonable, but 30+ miles is excessive.

  • Know the duration. 6-12 months is fair while anything over 2 years is restrictive.

  • Ask about the scope. Does it prevent all medical practice or just specific specialties?

  • Determine if there is a buyout option. Can you pay to get out of the non-compete?

Termination Clauses: Protect Yourself

  • Without cause termination: Is there a fair notice period (at least 60-90 days)? Avoid short notice periods (e.g., 30 days), which leave you scrambling.

  • For cause termination: Ensure reasons are specific, fair, and allow for correction before termination.

Legal Review: Always Worth It

  • A healthcare or employment attorney can save you from career-limiting clauses and financial losses.

  • Never accept “this is non-negotiable.” Everything is up for discussion.

Everything Must Be in Writing

  • If it’s not in the contract, it doesn’t exist legally.

  • Demand all negotiated changes in writing.