Physician Contracts – Some Are Abusive

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Over the past 25 years, I’ve reviewed more than 1,700 physician contracts from over 2,500 hospitals and practices, in dozens of specialties, from all 50 states, DC, several U.S. territories, Canada, Europe and Asia. I also write or re-write contracts for practices and hospitals.

Some of these contracts are incredibly bad. That brings up my first point: We don’t know who wrote your physician contract. Once we look into it carefully, we may find it is well-written, or we may find it is absolutely abusive. In my experience, roughly 15% – 20% of physician contracts are written by experts who know the employer and their needs and who genuinely want the contract to be fair for all parties. There may still need to be a number of clarifications and a few changes made for the recruited physician, but let’s give credit where it’s due.

At the other end of the spectrum are contracts written by someone intent on short-changing the physician every step of the way. This may sound harsh, but it is a sad reality. I was once quoted in the American Medial News as saying “Thousands have Been Abused,” and I meant it! In Chicago, a consulting firm told the senior physician of a large clinic they had many years of experience writing physician contracts. This was not entirely false, but what they failed to say was they wrote one-sided contracts to keep newly recruited physicians in line. After losing several new physicians, the clinic asked me to re-write their contract. The original contract was appalling, and I felt strongly enough about it that I told the firm they should not be selling their services for such work. They didn’t like it, but I doubt they’ve changed. Remember, the loss of the new physicians was a huge cost to the practice and a huge cost to the recruited physicians who left in frustration after making bad career moves.

Realistically, about 15% of the contracts are written to be truly abusive, including in academic settings and medical centers. However, caution is still required as some medical practices just ask their CPA, business consultant, lawyer or even their hospital to write up physician contracts. These are often simple cut and paste jobs. Like that clinic in Chicago, the physicians in the practice don’t know what a contract is supposed to say. So if you get a bad contract, don’t throw it out too quickly. You may need to respond and tell them you want to work with them, but the contract needs a lot of work. If they don’t understand that, then move on quickly. There are plenty of other opportunities for physicians.

There are some exceptions to the above rule. If you are limiting your search to a specific geographic area, then you might have fewer options. In this case, you will have to work with them as best you can. Another alternative might be to rev up the search engine to find other options in the area. You may be surprised what you find when you aggressively search for, or create opportunities.

The key is to be analytical on these contracts and not let your emotions take over. Think for yourself and trust yourself. If it sounds too good to be true, then take a step back and ask why. If it sounds like they’re taking advantage of you, then they probably are.

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Roger Bonds is the founder of the American Academy of Medical Management and president of The National Institute of Physician Recruitment & Retention, based in Atlanta, GA. Find AAMM on FacebookLinkedIn, Twitter.and YouTube. Email AAMM at [email protected], or call their main office at 770-649-7150.