March 11, 2024- Before signing anything, physicians should clearly understand all the provisions of their employment contract and judge whether they reflect what is most important to them personally and professionally, says Steven P. Furr, M.D., FAAFP, president of the American Academy of Family Physicians. “And the bottom line is, a verbal agreement is only as good as the paper it’s written on.” Repertoire recently asked Dr. Furr to respond to questions about physician contracting. Here are his responses.
The basics
Repertoire: What percentage of physicians are employees today? How many have written contracts in place?
Steven Furr, M.D.: Currently, about 75% of AAFP members are employed. More than half of that 75% are employed by a hospital or health system. Just under half are employed by physician-owned groups or other entities like community health centers or the Veterans Administration. We are not aware of any common practices where physicians are employed without contracts.
Repertoire: Does practice ownership (i.e., independent, corporate, health system, private equity) affect physician contracting?
Dr. Furr: Employment contracts with private practices or physician-owned groups may include an option for future equity. Such contracts should include a date by which to expect the option to become an owner; benefits, voting rights, and compensation for owners; and expected cost of becoming an owner. Physicians should insist the contract not terminate immediately if equity is not offered or if there is a delay. If this provision is not included, the physician could be left working without a contract in the event the practice delays or does not offer ownership equity.
Read More in the latest issue of Repertoire Magazine.