10 Potential Time Bombs in Your Employment Contract

Leigh Page


October 22, 2015

In This Article


When you sign an employment contract, you may lose control over your work and, in some cases, forfeit a portion of your future income. A recent Medscape survey[1] showed that 32% of employed physicians felt they'd lost some autonomy after signing their contact, and 44% said their income potential was limited—this despite the perks of not having to run a practice, the guarantee of regular income, and a lack of hassles with insurance companies, among other advantages.

Many of the things employed physicians complain about often can be traced back to accepting onerous provisions in their employment contract. Too many doctors, it seems, focus on the salary and perks they're offered while ignoring the meat and potatoes of the contract itself.

Although you may not be able to adjust certain features of your existing document, we'll prepare you as best we can for your next round of negotiations. Here, five healthcare attorneys identify 10 dangerous and costly pitfalls they've seen in employment contracts—and what you can do about them.

1. You Might Have to Give Back Some Income, Even if You're Not at Fault

Increasingly, hospitals are inserting contract provisions that make the physician financially responsible if auditors for the government or private payers identify overpayments, according to Alice Gosfield, an attorney in Philadelphia.

"Medicare may come along and audit you and say you've upcoded your bills, and there's been an overpayment of $57,000 for the past 2 years," she says. You may find yourself personally responsible for the bill, because "the contract states that the physician is liable when faulty documentation was the problem," she adds.

The employment contract may even make you responsible for errors you didn't commit, says Deniza Gertsberg, an attorney in East Brunswick, New Jersey. It may state that in the event of an audit by an entity such as a recovery audit contractor, the physician assumes responsibility for any funds that are owed.

"The best solution would be to take out all reference to your responsibility," she says. "But if this isn't possible, limit your responsibility to intentional misapplication of codes."

Gosfield would limit responsibility to instances in which the doctor is the direct cause of the error, such as providing the wrong information to your coder. She added that the contract should allow you access to the basic data involved in the audit, obligate the employer to pursue your defense in such cases, and authorize you to help select an attorney to defend you and your employer.


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