• How to Negotiate a Physician Employment Contract

    Ace Contract Negotiations:
    Tips From a 5-minute Practice Hack


    Understanding how to negotiate your employment contract is essential to achieving professional satisfaction and personal fulfillment.

    Use these tips to guide your physician contract negotiation strategy and reach a successful outcome: 

    1. Review your contract and identify the most important items to negotiate.
    2. Understand what you should ask for in physician contract negotiations.
    3. Hire the right advisers to coach you.
    4. Conduct negotiations yourself.
    5. Get every change in writing.
    6. Know your exit strategy.
    7. Abandon negotiations if your priority items can't be met.

    1. Review your contract and identify the most important items to negotiate.

    Preparation is the best strategy for successful physician contract negotiating. Review your contract carefully, which you can do with the help of this member-exclusive simple checklist that will help you identify possible concerns.

    Make a summary of items most important to you, and order them by priority. Identify the major goals you’re seeking in an employment opportunity and any concerns. Understanding your goals and what is important to you can help refine your review. For example, if burnout is a concern, consider prioritizing scheduling issues or avoiding burdensome administrative or call requirements.

    Although some people like to have “throw away” items to use in negotiations, this can sometimes backfire if the employer is presented with a laundry list of issues, some of which may be of questionable value or consequence. 

    Member Benefit

    What should you be earning? AAFP members get a discount on access to real-time physician salary data through Resolve with the code AAFP10. 

    Resolve rData — Resolve's proprietary data from thousands of contract submissions. Explore on the Resolve rData homepage.

    2. Understand what you should ask for in physician contract negotiations.

    Talking with other physicians in the organization about how they have been treated can help you learn more about what you can negotiate for in a contract. Ask for the same or different items or treatment based on the information collected. 

    The willingness of any employer to modify an employment agreement depends primarily on the employer itself. Is it a large organization with standardized contracts they can’t or won’t change substantively? Do you have extra negotiating power because the employer badly needs a physician? Has the employer agreed to changes in the past but later regretted that decision? Every party to a contract negotiation comes with its own set of experiences and goals, and it helps to understand what they may be.

    Some of the top items to consider negotation for roles in any setting include:

    • Increased salary
    • Time outside of patient care hours to complete administrative tasks
    • CME funding
    • Work location and schedule clarification or changes
    • Increased time off
    • Limiting enforcement of non-compete agreements to only certain reasons for termination, excluding reasons outside of your control, like force majeure
    • Clearer for-cause termination provisions
    • Payment of your AAFP Membership

    3. Hire the right advisers to coach you.

    Choosing and hiring a lawyer and working with a financial advisor are the best ways to equip yourself for success.

    A financial advisor can help you understand the tax implications of your salary offer and can research compensation averages in your area to help you negotiate salary.

    An attorney can discuss the contract language with you, including focusing your attention on issues you may not have noticed or understood.

    4. Conduct negotiations yourself.

    A negotiation is the beginning of your relationship with the employer and sets the stage for what working together will be like. You’ll gain insights about your future employer through direct interaction and can better convey your needs and concerns than a legal representative could. Plus, many of the items you’ll likely identify for negotiation, such as salary and daily activities at the organization, don’t involve legal issues.

    A self-led negotiation can demonstrate your thoughtfulness to the employer and give you insight into the employer-employee relationship you are considering entering into. For example, if the employer seems indifferent or dismissive of your concerns or responds in a condescending or rigid manner, that’s a potential red flag. On the other hand, you can find great reassurance in an employer’s responsiveness and detailed explanations on various issues. None of this can be fully captured by having legal counsel engage in the discussion on your behalf.

    Additionally, you’re best positioned to directly address items you have questions about from your interview conversations and previous discussions.

    Bringing legal counsel into the negotiation is best when there are legal issues that remain after you’ve worked through the initial items on your list with the employer. Narrowing down the items to be negotiated before counsel gets involved can also help reduce legal expenses.

    5. Get every change in writing.

    Many times, physicians are forced to rely on verbal assurances and promises when they negotiate an employment agreement. Many employers, especially larger ones, simply will not make any changes in the written contract, meaning that you must trust that the employer is acting in good faith if you choose to sign an agreement with them.

    As you assess elements of your contract you are not able to get changed in writing, you have to decide what you are willing to live with and if the issue is worth walking away from the job opportunity.

    If you sign onto a contract that does not perfectly reflect the terms you had hoped for, it is especially important when this happens that you're aware of and satisfied with the contract exit strategy. Ask yourself: If I am not happy in my job, do I understand the termination provisions? Do I know how to get out of my contract and what the consequences will be?

    6. Know your exit strategy.

    Be aware of exactly how you can terminate the agreement and what that would look like before you sign. Termination can have numerous effects on items like insurance, bonuses, non-compete agreements, and loan forgiveness. A lawyer can help you develop a plan.

    7. Abandon negotiations if your priority items can't be met.

    Compromise too much, and you can find yourself in an unhappy employment situation. Although negotiating often means letting go of some items, stick to your original priorities (e.g., if providing obstetric care is important to you, make sure your contract includes that scope of care). 

    A contract should present more pros than cons. Only in a situation where you have no other likely opportunities, for example, due to issues such as immigration or loan forgiveness requirements, should you sign a contract with more cons than pros.

    Helping Members Negotiate