6 ways to evaluate a physician employment offer

December 3, 2014

As an independent physician mulling employment, how can you tell if an offer you receive is too good to turn down?

Approximately two-thirds of all physicians have now accepted employment in large groups or hospitals. Large organizations are on a physician hiring binge to build their accountable care organizations under the Affordable Care Act. As an independent physician mulling employment, how can you tell if an offer you receive is too good to turn down?

Most physicians accept employment without first giving it a thorough “history and physical exam.” By asking pertinent questions up-front-before you accept the job-you can save yourself a lot of aggravation later. First, it will help you to avoid joining the wrong practice. Second, knowing your rights in the practice ahead of time will help you or your employer avoid dragging each other to court in the future. 

Physicians should scrutinize the employment offer to make sure the fit is there, paying special attention to the following six factors.

1. Compatibility

First and foremost is compatibility between you and the people and environment you will work in-the physicians, the staff, and management. Does it feel like a comfortable environment to you? Visit the workplace for at least a full day.

 Are there any philosophical deal-breakers for you, like on-site abortions or family-planning limitations? It’s a lot easier to tolerate a bureaucratic employment environment straight out of residency, then after you’ve been your own solo boss for 20 years.

2. Check references

In addition to interviewing employed physicians there, call another physician who left employment there and ask about his or her experience. If the feedback is positive, you’ll know it. If it is lukewarm or guarded, you’ll be able to read between the lines. Does the employer have a rude nickname in the community, and for any pertinent reason? 

Has the organization had any bad press in the past? Ask the staff what problems there might be. I know a physician who was approached by a staffer in the parking lot to tell them “they were too nice to work here.”

NEXT PAGE: Exploring income, financial and legal issues

 

3. Income, financial and legal issues

Carefully assess the business health of the practice. The best approach is to have an independent medical consultant (available at NSCHBC.org or MGMA.org ) review the offer and tell you if it is a good opportunity. A consultant can find many hidden problems that an inexperienced person might miss.

Is there an income guarantee? If so, for how long? Guaranteed by whom? Then what? Most practices pay a base salary plus a percentage for productivity, either by collections or work relative value units. By offering these incentives, the practice is asking you to demonstrate an ability to manage volume and build a practice. Are the incentives reasonable, or so unrealistic that no newcomer could expect to reach them? Is achievement of the incentive based on the competence of their billing office? Check out the turnover history among employees in the practice to see if there’s a “revolving door” situation. 

A very important consideration that many overlook is the ability to enroll in any insurance contracts. What if a practice gets the majority of its patients from one or two health plans, but the plans are closed to accepting any new physicians? Get participation guarantees in writing from the plan itself. 

Are you expected to eventually buy into this practice? How much and when? Are any senior owners planning to retire, and expect to be bought out by the other shareholders? If so, at what price? Is that why they are bringing you in?

Then run the paperwork by a medical practice specialist attorney. I’ve seen “5 year” contracts wherein the employer can cancel with 90 days notice-and they did. Go to the Superior Court and look for history of litigation, or have your attorney do it.

Some physicians leave their employer’s practice after a period of time to start their own practice in the community, only to find that their contract had a “restrictive covenant” prohibiting them from practicing within an extensive area. Check with your attorney about enforceability if you find such a clause in the contract.

NEXT PAGE: Security and management

 

4. Security and risk

What’s your “Plan B” if things don’t work out? If you decide after a few months that the job is not for you, can you walk away without major obligations? Always plan your exit strategy going in.

5. Government and management

Who is in charge of the physicians? Is there a senior doctor, or a lay president? Are there elections to determine this individual? What are the decision-making rights of the physicians who do not have seniority? For example, can you choose/fire your own medical assistant? As a patient, I was made quite uncomfortable recently due to the bickering between a physician and a nurse practitioner that occurred in front of me.

If there are disagreements in the way the practice is run, how are they handled? Is there a protocol for arbitration?

What is the frequency of staff meetings? If staff members don’t get together at least once a month, expect some communication problems and unresolved issues.

If you’re considering joining a small group with nepotistic tendencies, and you have a problem with a staff-family member, how will it be resolved? 

What are your management/committee responsibilities? What responsibilities would you be willing to accept?

6. Systems

Is your personal space an office, a cubbyhole, or a spot referred to as “we’ll work that out”? Some physicians function very well sharing a desk in a noisy environment-others need those four walls and a door to get through the day.

Do employees have clear job descriptions? Do the doctors handle the employees professionally, or are they at risk for a lawsuit? Do the physicians treat the staff with respect and professionalism?

Patient distribution refers to how patients are divided up in the practice. Does the new physician get all the troublesome patients the other doctors don’t want to see?

Who’s going to show you the ropes? Or are you just expected to absorb the way things are done through osmosis?

If the practice has a document that spells everything out on paper, wonderful! It’s more likely that they will have the bare bones of an employment or partnership contract, 95% of which is written in legalese, and often out of date. 

You can work with your lawyer or a practice management consultant to list everything on the document that could impact you in the future. Get everything in writing or risk future problems!

If the employer balks at this kind of detail or says, “we’ll work out all of that later,”  your response should be, “I’m really interested in the position, but to be comfortable going ahead, I need to know these answers.”

Conclusion

Similar to a patient encounter, the most important factor to consider as you ask questions and collect answers is thorough documentation.

In other words, get it all in writing.

Keith Borglum, CHBC, is a practice management consultant, appraiser and broker in Santa Rosa, California.