Physician employment contracting is tricky business for everyone involved, but it can be especially difficult for private practice employers. Physicians are increasingly opting for employment by hospitals and health systems, so knowing the contract provisions that can make them reconsider working in a private practice is all-important.
“These are clauses that aren't going to be in your basic widget-company contract because it's so specific to the practice of medicine, and they're provisions that are important to physician employers,” said Elizabeth A. Snelson, during a presentation to the AMA Private Practice Physicians Section at the most recent AMA Interim Meeting.
Snelson, who is president of Legal Counsel for the Medical Staff PLLC, which specializes in working with medical staffs and medical associations, drew her guidance from the AMA Physicians’ Guide to Hospital Employment Contracts (PDF). That is a guide she wrote and that is free to AMA members and provides expert guidance to physicians contemplating, entering into or working under employment contracts with hospitals or related entities.
Make it work for both sides
Physician employees are increasingly scrutinizing their employment contracts, Snelson noted.
“Not the flashy parts of the contract having to do with zeros and how much reimbursement is involved and how much compensation is involved, but more about the issues that make the employment relationship different because you're doctors,” she said, calling out these three in particular.
Professional judgment. The guide’s sample provision notes that the employee “shall retain the unfettered right to advocate for patients and to exercise their personal and professional judgment in providing treatment and health care services to patients in their care.”
This may seem like an obvious feature of the practice of medicine, but it doesn’t always make its way into contracts, Snelson said.
“Physicians get fired or disciplined for exercising professional judgment and don't have a defense because their contract doesn't address the issue. And as an employer of physicians, you want your physician employees to do what you've hired them to do, right?” Snelson said. “This is a key part of that practice that should be right there in the contract.”
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Peer-review restrictions. These provide protections to both practices and employed physicians.
“Under federal law, if you have a formal peer-review process, you could win an immunity in federal court and in state court,” Snelson said, adding that, if practices meet some base requirements, “review is confidential, depending upon state law. That means it can't be used against the practice in malpractice cases.”
But the terms have to be in writing, she noted.
"There's protections for the group in doing that, but the protections are conditional and they're conditioned on giving rights to the individual,” she said. “Review by peers should be part of the rights. And then the opportunity for a hearing to challenge it—that’s what the individual physician gets out of it. So the employer gets something out of it [and] the individual physician gets something out of it."
Well-being and diversity. “Any entity that employs physicians has to understand that physicians get sick, physicians have health issues,” Snelson said.
In fact, the most authoritative advocates on this issue are physicians who employ other physicians. Drawing on their professional creed, they should be guided by the maxim, “Do no harm to your employees,” Snelson said.
It takes astute clinical judgment as well as a commitment to collaboration and solving challenging problems to succeed in independent settings that are often fluid, and the AMA offers the resources and support physicians need to both start and sustain success in private practice.
A lawyer’s help is essential
No matter how much they might think they know about contracts, every doctor should seek the help of a lawyer who specializes in physician employment, Snelson noted.
“It’s not a sign of weakness,” she said. “Things are different for doctors.”
The AMA has assembled a variety of resources to help physicians flourish in the employment setting. That includes developing the Annotated Model Physician-Group Practice Employment Agreement (PDF) as well as experts’ perspective on collective bargaining for physicians.
Find out more about the AMA Private Practice Physicians Section, which seeks to preserve the freedom, independence and integrity of private practice.
