Commentary

Five contract red flags every physician should know


 

Malpractice tail

Although many employers will claim it is not unusual for an employee to pay for their own malpractice tail, in the current marketplace, the payment of tail can be a deciding factor in whether a candidate accepts a contract.

At a minimum, employers should consider paying for the tail under circumstances where they non-renew a contract, terminate without cause, or the contract is terminated for the employer’s breach. Similarly, I like to seek out payment of the tail by the employer where the contract is terminated owing to a change in the law, use of a force majeure provision, loss of the employer’s hospital contract, or similar provisions where termination is outside the control of the employee.

Employers should also consider a provision where they share the cost of a tail or cover the entire cost on the basis of years of service in order to stand out to a potential candidate.

Noncompete provisions

I do not find noncompete provisions to be generally unacceptable when properly written; however, employers should reevaluate the reasonableness of their noncompete language frequently, because such language can make the difference in whether a candidate accepts a contract.

A reasonable noncompete that only protects the employer as necessary and does not restrict the reasonable practice of medicine is always preferable and can be the deciding factor for a candidate. Tying enforcement of a noncompete to reasons for termination (similar to the tail) can also make a positive difference in a candidate’s review of a contract.

Egregious noncompetes, where the candidate is simply informed that the language is “not negotiable,” are unlikely to be compelling to a candidate with other options.

Specifics on location, call, schedule

One item potential employees find extremely frustrating about contracts is when it fails to include promises made regarding location, call, and schedule.

These particular items affect a physician’s expectations about a job, including commute time, family life, and lifestyle. An employer or recruiter that makes a lot of promises on these points but won’t commit to the details in writing (or at least offer mutual agreement on these issues) can cause an uncertain candidate to choose the job that offers greater certainty.

There are many provisions of a contract that can make a difference to a particular job applicant. A savvy employer seeking to capture a particular health care professional should find out what the specific goals and needs of the candidate might be and consider adjusting the contract to best satisfy the candidate.

At the end of the day, however, at least for those physicians and others reviewing contracts that are fairly equivalent, it may be the fairness of the contract provisions that end up being the deciding factor.

Ms. Adler is Health Law Group Practice Leader for the law firm Roetzel in Chicago. She reported no relevant conflicts of interest.

A version of this article first appeared on Medscape.com.

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