3 Things to Double Check in Your Contract as a Physician or Health Care Professional

The time is finally here. You are finally a licensed physician or health care professional and it’s time to start looking for a job in your specialty. All your hard work and years of school are about to pay off.  

Wait a minute. Your new company will likely want you to sign a contract as a condition of employment. You know a lot about the human body, but not much about contracts and your hesitant to sign such a big document.  

In a world where hire and fire at will is the primary rule of law, not many industries have future employees sign any sort of employment contract.  However, the professionals in the medical industry are one big exception to that. If you are a physician or other health care professional, it is standard practice to be required to sign a contract when starting a new position.  These documents are commonly 10-30 pages long and are full of legal terms that can detrimental to the employee signing them.  However, it is often easy in the excitement of the beginning to listen to the words the company is saying and quickly review and sign the contract without giving it much thought.   

It is important to remember, companies require contracts to protect themselves first, not you as their future employee. At Lonzo Law, we work with physicians and other health care professionals to review their contracts prior to starting a new job.  Whether your new job is going to be with a private practice, university, or you are joining a large healthcare system, we review your agreements to 1) protect you and your needs, 2) make sure your transition is easy going into the new job and that the groundwork is laid for an easy exit if and when you decide to leave the organization, and 3) ensure you know you are getting what has been promised and that your offer aligns with the benefits being received by other health care professionals in your field.  

Here are the three things we always focus on when reviewing contracts for our health care professional clients.  

1. Understand the specifics of your restricted covenants.  

Restricted covenants, also known as non-competes, non-solicitations, and non-disclosures, are typical in contracts between an organization and a professional. In the healthcare industry where professionals may move around often, restricted covenants are very important to understand to prevent stress in the future. A lawyer should review your contract’s restricted covenants to ensure they are reasonable and to let you know how they will affect your choices if you ever decide to leave.

For example, does the non-compete pertain just to the office or facility you worked in or the entire health system? This could be a big difference if the health system is large which can prevent you from moving to another organization in the region. Or, does the non-compete still apply even if you are terminated without cause?  After the pandemic resulted in downsizing in healthcare systems across the US, many health care professionals with a clause like this were forced to look for jobs outside of the restricted area of their agreement, causing them to relocate, travel long distances, or wait out the term of the non-compete, even though they didn’t choose to leave their last job.   

2. Understand the terms of termination or renewal of contract.  

It is an exciting time when starting a new job and, in the beginning, you typically don’t think about when and how your time with that organization may come to an end. However, it is always better to be prepared for that occasion rather than dealing with it at that time.  

Your contract should clearly outline the length of the agreement, if early termination is possible and what consequences accompany an early termination, and how renewal terms will work.   When reviewing, try to keep in mind that the initial terms you receive are more than likely drafted in a way to protect the organization first and not you as the employee.

Having a lawyer review the terms around the conclusion of an agreement, including how termination can occur, if cause is or is not required, and how the renewal process will work can allow you to properly prepare an exit strategy when the time comes which will save you a lot of time, money, and frustration down the road. Also, should you need to terminate your contract early, a lawyer can assess the consequences of termination and how that may affect the contract’s restricted covenants or your bonus.  

3. Understand the type of benefits and bonuses you should be getting.  

Sign-on, relocation, continuing education, productivity, student loan repayment, parental leave — contract benefits and bonuses come in all shapes and sizes. It’s easy to see the importance of understanding the terms of the bonuses and benefits outlined in your contract, but it is also incredibly important to understand when there is more room for negotiation. Working with a lawyer who is knowledgeable in the health care industry allows for more creativity in your bonus structure that you may have not known was possible.  

For example, on average, Lonzo Law clients receive an additional $10,000 in bonuses or benefits after they engage our services in review and negotiation of their physician agreements. Plus, we do not require payments of services until our client receives the bonus or another pre-determined set date.  

At Lonzo Law, our goal is to ensure you are well protected, getting what you deserve and have been promised, and are prepared for your upcoming employment; including being financially sound before you start your new job. That is why we don’t charge our clients until after they receive their first bonus payment or until after the scheduled start date of the employment.  For a review of your contract as a health care professional, contact us.