Evaluating an Employment Agreement

• How are salaries computed and when are they paid?
• If compensation is based on productivity, what is the formula? Are there minimum (base) guarantees? For how long is the guarantee in effect?
• Is there a percentage of the fees that you will be paid over and above a guaranteed amount?
• Does the practice allow the employee to review the financials upon which the compensation may be based?
• Are bonuses awarded and under what circumstances?
• If an employer offers a base salary plus incentive compensation, how realistic is the chance that you will achieve your target incentive?
• How will you qualify for incentive payments?
• How are incentive payments calculated? How will your data be collected and submitted?
• Are variable models based on collections, charges, visits, work relative value units (wRVUs), or some other standard?
• Does compensation reward high-quality, cost-efficient care such as value-based payment models or simply encourage you to see as many patients as possible?
• What is the buying power of your salary in the community in which you relocate? (A San Francisco practice may offer twice the salary of the rural Midwest but have three times the cost of living.)

• What will your duties be?
• What will your on-call, referral, coverage, and house call schedules be?
• What will your office schedule be? Does 40 hours a week mean 40 hours scheduled to see patients or 35 hours to see patients with 5 hours of admin/recordkeeping time?
• How are weekends, evenings, and holidays rotated?
• How many hours per week and per year will you be required to work?       
• Is there additional compensation for hours worked beyond the required amount?
• At how many sites will you be required to report to work? Where are they located?
• How many patients per hour are typical, and what type(s) of patients are these?
• Will you be required to take emergency department or hospital calls? Are there pediatric hospitalists to help care for inpatients?
• Is attendance at practice meetings outside of patient hours required, and if so, compensated? 
• Will you be responsible for the supervision or collaborating agreements of any advanced practice providers (nurse practitioners or physician assistants)?

• What privileges or affiliations will be required?
• Is board certification required within a certain period after beginning work? Will board certifications fees be paid by the employer?
• Are there any obligations, implied or specified, to admit to certain hospitals or use certain medical facilities?
• Does the employer pay for hospital application and annual dues?
• Will the employer pay for medical licensure fees?
• Will medical licensure in more than one state be necessary?

• How will patients be assigned to you (i.e., how will you get your fair share of patients)?
• Are patients considered your patients (i.e., “your” panel) or are all patients shared across the practice?
• Where will referrals come from? Will the employer announce and market you joining their staff?
• How many exam rooms will be allotted to your schedule? How many support staff are assigned to room your patients and call your patients back? Do you share support staff with other clinicians?  What administrative support can you expect?

• How much, if any, of your moving or relocation expenses will be paid? For what specific expenses, and how will these expenses be paid (directly or reimbursed, and only if incurred by a certain date)? Is this a flat fee or based on specified expenses?
• Will there be a sign-on bonus?
• Will funds be allotted toward educational loan relief?
• Will opportunities to teach residents or students in the practice be supported?
• How satisfied are current physicians with the electronic health record(s) (EHR) they are required to use? A good EHR, used appropriately by all staff, can make a huge difference in the quality of your work, the morale of the physician and staff, and the amount of documentation time required outside of direct clinical contact.

• Does the practice cover your malpractice insurance? What type of policy (claims-made or occurrence) is it? What is the amount of coverage per claim and annually? For instance, if a policy coverage were described as $1million/$3 million, the first number is the maximum amount the insurance company will pay per malpractice claim during the policy period (usually 1 year). The second amount is the maximum the company will pay for all claims during the same policy period. 
• If it’s not an occurrence policy, you will need tail insurance. Will tail insurance for malpractice be provided if you have a claims-made policy and your employement is terminated?   Who will pay for it?  Is this based on how long you've been at the practice? Tail insurance is at least 3 times the cost of the annual premium. Negotiate who pays for some or all of the tail now.
• Is health insurance provided for you and your family? What is your share in the premium costs?
• Is life insurance provided? At what value? What kind of policy is it?
• Is disability insurance provided?
• Are other supplemental insurance plans (vision, dental, accident, etc) provided ?
• When will insurance coverage be active? Is this amount of time reasonable?

• What are the vacation and sick leave plans? How do you request time off?
• Are personal days allowed? In what quantity? Are these paid?
• Will the number of days off or vacation days increase after the first year of the contract? What can be rolled over from year to year?
• Does the size of your employer mean you qualify for benefits under the Family Medical Leave Act?
• Is there paid and/or unpaid maternity/paternity leave? How long is it and how does it interface with salary and vacation time? Are there any restrictions?

• Is there a retirement plan (SIMPLE, SEP, 401(k), 403(b), profit sharing, etc) and how does it function? Are there matching contributions?  How soon can you participate?
• Is there a contingency plan in the event of your death or the death or incapacity of a member of this group?
• What is the policy should you become ill or disabled and unable to practice for a length of time?

• How much time and funds for CME will be allotted?
• Will CME travel expenses be paid?
• Can time be taken off without penalty for CME?
• Does the employer pay fees for the Neonatal Resuscitation Program, Pediatric Advanced Life Support, Basic Life Support (training, course materials, examination fees, etc.)?
• Will your annual AAP dues be paid? What about state/chapter dues and other society membership of interest?
• Is involvement in AAP volunteerism and leadership activities encouraged and accommodated?
• Does the practice provide a smart phone, pager, tablet, and/or laptop?

• What is the length (“term”) of the contract?
• What are the renewal stipulations?

• What is the termination or withdrawal policy?
• How much notice must be given once you decide to leave?
• Can you be fired or dismissed from the group, and under what circumstances?
• What rights do you have to dispute your termination or rectify the situation?
• What constitutes “cause” for your dismissal (g., loss of your license or board certification, your provider status with the insurance companies or hospital privileges, substance use or abusive disruptive behavior, etc.).
• Remember the question about tail insurance and who pays for it? This is when the importance becomes real. Negotiate for completely covered or partially covered tail insurance for when you and the employer part ways.

• Is there a non-compete policy of the group (restrictive covenant) should you decide to leave? Look for these 4 parts: geographic area, time restriction, monetary penalty, and schedule of penalty payments.
• What would the penalties be for a breach of this non-compete clause? Note that in underserved areas, courts have been known to void such covenants as not in the public interest, but such a legal challenge has a cost in time, energy, and money. In some states, non-compete agreements in healthcare are illegal.
• What is the policy on patient notification and release of medical records should patients want to follow you?

• What is the policy addressing moonlighting and other outside activities?
• Are you permitted to keep funds received from outside sources?

Partnership (partial ownership of the practice and its assets) may be a path of interest for physicians with managerial acumen.

• What provisions does the contract make for partnership, often after a trial period?
• What ranks of partner exist, with what attendant managerial responsibilities?
• What is the price to become partner, how is it determined, and which business assets (accounts receivable balance, physical plant, office equipment, equity buyout, perceived value of patient goodwill, etc.) are included?
• What options to buy-in are offered: continued salary, discretionary, based on performance, immediate payment in full, interest-bearing internal loan, or non-interest-bearing internal loan?
• What governing documents exist, and do they reflect how the practice actually runs?
• Are the corporate agreements and annual reports available for you to review at any time?