When I am hired to do a physician employment contract review, I regularly uncover a multitude of different contract provisions that can be made more favorable to my clients. In some instances the employment contract is relatively balanced with regard to many contract terms, but in other ways the contract is completely lacking in crucial provisions that will make the employment arrangement a good one for the physician to enter. For example, a few not-so-obvious aspects to keep in mind are:

1. Your ability to earn income outside of the employment arrangement

Many times employers attempt to keep for themselves any income earned by the physician for activities performed as a physician. For example, some physician employment contracts stipulate that if a physician consults with device manufacturers or other medical industry companies, any income realized from the physician’s work for the company will be the property of the physician’s employer.  Other times contracts will require that a certain percentage of this income must be paid over to the employer. It is also not uncommon for physician employment contracts to require that any income earned by the physician for serving as an expert witness in a trial, or in other physician-based capacities will be the property of the employer. Provisions such as these are obviously unfavorable to physicians, as in many cases, especially those in private practice, physicians rely on outside compensation to supplement their annual income.

2. Having assigned OR and procedure room times

This point is often overlooked by younger physicians who are accustomed to being forced to work at all hours of the day and night, whether they want to or not. Of course, starting your own practice is an entirely new ballgame, and one factor that is often overlooked is the assurance that you will in fact have a physical space to practice medicine and surgery. Many times physician employment agreements will simply state that the employer will provide the physician employee with the space and equipment he or she needs to perform the job at hand. However, it is a maddening experience to show up to work on day 1 and find that the optimal OR and procedure room times are filled by senior physicians, or those who made sure to ask for specific time assignments in their physician employment contract. One can only imagine the frustration felt by a physician starting a new job who comes to find out that yes, in fact, they do have two days worth of assigned OR or procedure room time, but it’s broken up between afternoons on Tuesdays and Fridays and all day on Saturday. Paying close attention to the terms of a physician employment contract relating to these accommodations can make an enormous difference in the long-term success and satisfaction in an employment arrangement.

3. Ensuring balanced billing responsibilities and liabilities

It is not uncommon, especially in private practice, for physician employment contracts to include a provision placing responsibility on the physician employee for certain billing duties. In some cases, employment agreements state that billing personnel will be responsible for coding the services provided by the physician and submitting the bills for payment, but also that the physician will be liable for any recoupments or other recoveries that occur due to incorrect bills. While it is desirable for physicians to have someone experienced in billing be responsible for submitting their claims, there can be very detrimental consequences to the physician if a mistake is made and care has not been taken to protect the physician from liability. Additionally, this type of arrangement can lead to unforeseen consequences to a physician’s incentive or bonus income if billing responsibility is not properly tailored.

It is important that physicians have their employment agreements thoroughly reviewed to ensure that all provisions are carefully considered, and that they negotiate for adjustments to be made in critical terms so that their employment arrangement ends up being as favorable as possible.


Though the views expressed above are solely the writer’s, Guthrie supports “The Dose with Dr. Goodhook” and is partnering with Adventures in Medicine to create an open, inspiring and insightful community for residents and physicians. Click here to learn more about ways that Guthrie is making practice purposeful.

About the Author: 

Leigh Ann spent over six years practicing as a health care attorney with two major health law firms before she founded Lauth O’Neill.  In her legal practice, Leigh Ann represented physicians and other health care providers in a wide array of legal matters, including employment contracting, provider reimbursement, regulatory compliance, and payment reform.   

Leigh Ann earned her B.A. from DePauw University, and her J.D. from Indiana University.  As an attorney licensed in multiple states, Leigh Ann handles the legal aspects of the services she provides almost exclusively, and is able to consult with other local attorneys when necessary.  

Leigh Ann can be reached at loneill@lauthoneill.com or Visit  www.lauthoneill.com.

Disclaimer: The material provided on this webpage is for general informational purposes only and is not legal advice. None of the information contained herein is intended as, nor should it be construed as, legal advice. The use of this webpage does not create an attorney-client or other relationship between you and Lauth O’Neill Physician Agency, LLC.