July 18, 2025 • 40 mins
Sarah Laws, CEO of Physician Prosperity, speaks with Dennis Hursh, a veteran physicians’ lawyer, and Jim Dahle, a practicing emergency physician, about how attorneys can help physicians navigate employment negotiations. They discuss potential misconceptions physicians may have about employment contracts, the connection between legal and financial literacy, potential risks during the negotiation process, how attorneys can better work with physician clients, how financial advisers and attorneys can better collaborate to assist physicians in a holistic way, and what to ask during a contract negotiation. From AHLA’s Labor and Employment Practice Group.
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Episode Transcript
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SPEAKER_02 (00:00):
This episode of AHLA's Speaking of Health Law is
brought to you by AHLA membersand donors like you.
For more information, visitAmericanHealthLaw.org.
SPEAKER_03 (00:17):
Hi, everyone.
I'm Sarah Laws, CEO of DecisionProsperity, and today I'm joined
by Dennis Hirsch and Jim Dolleyto talk about leveling the
playing field.
How can attorneys...
empower physicians in employmentnegotiations.
Dennis is a veteran physician'slawyer.
He's vice chair of the Labor andEmployment Practice Group with
the AHLA, and he's the author ofThe Final Hurdle, A Physician's
(00:40):
Guide to Negotiating a FairEmployment Agreement.
Jim Dolley is a practicingemergency physician and the
founder of White Coat Investor,the most widely read
physician-specific personalfinance and investing website in
the world.
So guys, thanks for joining metoday.
We're excited to be here.
Before we jump in, I'd love tohave each one of you just share
(01:01):
why this topic matters to youpersonally.
SPEAKER_00 (01:03):
Well, I can start first.
I mean, what I do is reviewingemployment agreements, and I see
so many horrible agreements thatthe physician is renewing and
the first agreement is justhorrible.
So I think it's really importantthat we get the word out to the
lawyers that are representingphysicians that there are things
(01:26):
you can do and go for it.
SPEAKER_01 (01:30):
Yeah, I'm a firm believer that A physician that
is financially comfortable, thatis financially stable, that has
their financial ducks in a row,however you want to describe it,
is a better doctor.
They're a better parent.
They're a better partner.
They're a better doctor.
They get better medical carewhen they're less worried about
their finances.
(01:50):
And the first thing you got todo to have finances is to make
some money.
And it's hard to do that withoutsome sort of employment or
partnership contract.
So if things break down right atthe beginning of the process of
building some sort of wealth orsome sort of financial
stability, the rest of itdoesn't go very well.
And so physician contracts,physician negotiations for
(02:13):
employment, it's all animportant part of the process.
SPEAKER_03 (02:15):
Absolutely.
And I couldn't agree with youmore.
You can't be giving your best ofyourself to your patients, to
your family, to everybody ifyou're worried about your
financial things that typedirectly into contracts.
Let's talk about what physiciansdon't know that can hurt them.
Dennis, there's this illusion ofthe standard contract.
(02:37):
When you first read anemployment contract, what are
you scanning for in the firstfive minutes?
Are you just skimming thedocuments?
Any clauses you consider dealbreakers?
SPEAKER_00 (02:46):
Well, no.
The way I do it is I prepare adetailed letter on law firm
stationery that I send to thephysician with the idea that the
physician will just take myletter and send it to the
employer.
So I don't actually skim.
I start at section one and startgoing through and saying, hey,
what can we do to make thisbetter for the physician?
SPEAKER_03 (03:06):
What?
You don't just skim throughlike, where's that salary?
SPEAKER_00 (03:13):
Good.
They said it was a standardcontract.
So there's no sense talkingabout this, I guess.
UNKNOWN (03:17):
Yeah.
SPEAKER_03 (03:17):
Jim, you have worked alongside thousands of
physicians.
What feelings do doctorscommonly have about their
employment contracts?
Do they know what they'resigning?
Is it really just a big questionmark?
SPEAKER_01 (03:32):
You know, Dennis might look at these things all
day long.
But a typical physician onlylooks at these things once,
twice, three times in theircareer.
This is a foreign language tothem most of the time.
And obviously they speakEnglish.
They understand some of thecontract, but there's a lot of
it they don't understand.
And the issue is the contractcomes up when things aren't
working out.
You know, when everything'sgreat, nobody needs a contract,
(03:54):
right?
But when things are not workingout is when people go to the
contract and find out what theyactually signed.
And so it's a lot of times it'sthe terms about the breakup, how
this relationship ends, that isthe first thing the physicians
notice.
And often it's way too late tomake any changes to the contract
at that point.
SPEAKER_03 (04:14):
Yeah, it's one of those nicely into a mindset
where I'm guessing you justdon't get a lot of business
training and legal training inmed school, which is great.
I mean, you shouldn't come outwith all this debt and all of
this.
SPEAKER_01 (04:30):
Yeah, it'd be nice to get a little bit of that
training, right?
I agree they don't get any, butthey do need a little bit.
Maybe that shouldn't be thefocus of medical school and
residency, but is it too much toask for an hour a year?
I don't think so.
And doctors are not even gettingthat.
SPEAKER_03 (04:44):
Yeah, and I think that's where lawyers can really
and attorneys can take someproactive steps with educating.
their clients and overcoming themindset and misconceptions.
I'm sure there's quite a fewmisconceptions about working
with attorneys and how thatgoes.
Not
SPEAKER_00 (05:03):
saying- No, physicians love attorneys.
SPEAKER_03 (05:06):
Not saying they're not everyone's favorite, but
Dennis, what do you think mostphysicians underestimate how
negotiable their contracts are?
Are they negotiable?
If somebody's working with you,have you ever seen a contract
not be changed when you've askedfor something.
SPEAKER_00 (05:25):
Actually, I have.
I've done, I don't know,thousands and thousands.
I'm guessing around 4,000 maybecontracts.
And I can count.
I used to say on one hand, butI've been doing it 40 years.
So now I could probably count ontwo hands the times that they've
come back and said, no, that'sour standard contract.
We don't change anything.
And many times, even on thosecontracts, they'll change the
(05:47):
compensation.
You can say, well, look, it'sbelow median signing bonus.
Sometimes they'll at leastchange the money.
But By far, I would guess 99.9%of the contracts that I've
looked at, the employers arewilling to make changes.
SPEAKER_03 (06:03):
I'm sure that has to put some skepticism in there for
physicians of what if I workwith an attorney and they don't
make any changes and I've spentall this money and all this time
and they're not going to changeit.
Jim, do you think thatphysicians could avoid legal
help because of the cost or theydon't see the value?
I
SPEAKER_01 (06:21):
do think that is a problem.
they become penny wise and poundfoolish, right?
I mean, a contract reviewservice typically only costs a
few hundred dollars, right?
You're going to make this backthe first morning you're in this
job, right?
It does not, this is not a hugeinvestment.
As financial services go, thisis one of the cheaper ones.
(06:41):
And so pretty much every docsigning a contract ought to have
it reviewed.
You know, this has beenconsistent messaging.
I've been given to docs for thelast 15 years since the White
Coat Investor was founded.
But, you know, it's interestingbecause the first question you
often hear from a doctor is, isthis negotiable?
And the problem is they assumethat negotiation is just kind of
(07:06):
asking for more, whereasnegotiation is a much more
in-depth process of knowing whatyou want and knowing what you're
worth, what the going rate isand what a typical contract
looks at.
And that's where an attorney canhelp because, you know, at least
most of them that are doing thiswork a lot have seen far more
contracts than the physicianshave and often have access to
(07:29):
data that helps the doctor toknow what they're worth.
I mean, obviously a doctorthat's being underpaid by 30%
should negotiate that salary.
A physician who's been made afirst offer that's actually a
very fair offer or even betterthan a fair offer, maybe they
ought to spend their negotiationon other points of that contract
rather than purely salary.
(07:49):
But the problem is so many docs,they don't have any of the
background information theyneed.
And so the employer is far moreempowered in the negotiation
than the contracting physicianis.
SPEAKER_03 (08:02):
Yeah.
And they have a whole teambehind them and they're trying
to get their best deal.
And it's, you know, I, I knowthat you're both like, how can
everybody come out with a fairdeal?
Like everybody should be happy.
You don't, you don't want anemployer that is going to
squeeze the physician to get themost out of them.
Like let's, let's create along-term working relationship
here.
Dennis, I know that yourcontract review is, is fixed
(08:23):
fee, which kind of alleviatessome of that question mark for a
physician of how much is thisgoing to cost me?
Cause traditionally, you know,our, our attorney's bill by the
hour.
And it's like, I might be agingmyself, but the, the old
commercial where it was, we hada baby eats a boy when they
were, they're calling, callingon a collect phone call of
(08:45):
trying to get through somethingas fast as possible.
And I think when you positionyourself like that, it's how can
you provide value to theattorney or to your, your
clients as the attorney that isauthoritative and not, you're
just trying to keep them on thephone as long as you can.
Cause you you want yourbillables to be up.
Do you ever get any questionsabout why you don't charge
(09:08):
hourly?
SPEAKER_00 (09:11):
Sometimes.
It's usually the other side.
Mine's simple.
It's a six-page contract.
I understand if it was a bigcontract, but I see people
getting 20-page.
Why are you...
Well, if it's six pages, there'sa lot of stuff that's not
addressed.
So sometimes I get the flipside.
Well, mine's really simple.
And you know, that's maybe aproblem, Doc.
(09:35):
You know, maybe there should bea little complexity in there.
You know, a little bit aboutwhat your rights are and some
limits on the employer.
So, unfortunately, I get it theother way.
I mean, a lot of physicians arehappy that, oh, I forgot to tell
you, you know, this, that, oh,yeah, I got your letter, but,
you know, I didn't mention theysaid I could work four days a
(09:55):
week.
And that's not, you didn'tmention that in the letter.
It's like, well, because Ididn't know it.
So, yeah, I think generallythey, they like it, but
sometimes I get the opposite.
It's like mine short and easy.
So no big
SPEAKER_03 (10:09):
deal.
Everybody wants a good deal.
So you're like, but you don'thave to read 27 pages of a
contract.
Surely I can get, I can get adiscount.
Yeah.
I, I appreciate their, their,you know, tenacity.
Let's talk about how financialliteracy and legal literacy go
(10:30):
hand in hand.
Dennis, how would you describethe connection between the two?
Do they go hand in hand?
I can't imagine signing anemployment contract and not
being concerned at all with thefinancial impact.
SPEAKER_00 (10:42):
Yeah, well, a lot of times physicians are happy if it
says we, the employer, willdetermine this after
consultation.
So they say, oh, no, they'regoing to talk to me.
It's like, well, that's fine.
You know, hey, we just bought anew hospital 50 miles out of
town and you're going thereevery Thursday.
How do you feel about that?
I don't like it.
Okay, good talk.
(11:03):
I'm glad we had this consult,you know, next Thursday.
I'm sending you to thathospital.
So they tend to think, oh, Ihave input.
So since I have input, the twoof us will jointly do it.
You know, if it doesn't saymutually agree, if it says
after, many times it just sayswe'll determine.
We'll send you wherever.
Your hours will be whatever wedetermine.
(11:23):
You know, you're calling us.
All coverage will be whatever wedetermine.
But sometimes physicians aretricked that, you know, after
input from physicians or afterconsultation with physicians and
they feel they're protected andthey're not really.
SPEAKER_03 (11:36):
Yeah.
And as these medical networksexpand and get bigger and
bigger, like it's, it's a realpotential risk for a physician
to get moved all the way acrossthe state.
I know where I am, you can'tswing a bat without hitting two
big medical industries and thatcan be really scary.
And that goes back to what thedoctors don't know and how
(11:56):
attorneys can empower thembecause again, they don't, they
just don't teach that stuff inmed school.
UNKNOWN (12:02):
Yeah.
SPEAKER_03 (12:03):
Jim, what's at stake if a physician just blindly
signs?
They see that number, they'relike, no, they have my best
intentions.
This person is absolutely great.
What are the financial potentialrisks or have you seen any
examples of when they don't geta contract, physicians don't get
a contract review and they goahead and sign and then they're
(12:23):
in it and it's backfired?
SPEAKER_01 (12:25):
Yeah, absolutely.
(12:55):
When this job agreement breaksup, you know, they cannot take
another job in the place wherethey live.
And you think about thefinancial ramifications of that.
Not only are you going to haveto recredential, maybe get a
license in a new state thatyou're going to be out of work
for months doing all that, butyou're going to have to pick up
your family and move.
And maybe your spouse is goingto have to change jobs.
(13:18):
You're going to lose a bunch oftransaction costs on housing.
It can be a very expensivemistake to be in any sort of
restrictive covenant that'sgoing to cause you to have to
change where you live in orderto continue to be employed.
Another big error we seephysicians make is that they
don't know how malpracticeinsurance works.
(13:42):
There are claims-made policies.
There are occurrence policies.
And if the policy provided toyou is a claims-made policy,
somebody's going to have to buya tail when you stop working
there, when that policy ends.
Otherwise, you're exposed toclaims that come in after
employment stops.
And that happens all the time,that a malpractice claim will
come in afterward.
And physicians have no idea...
(14:04):
What tail coverage actuallycosts.
It often costs two or threetimes the annual premium for the
malpractice insurance.
So it wouldn't be unusual for aphysician to find out that when
they leave this employer,they've got to come up with
$50,000 to buy their tailcoverage.
And that can be a lot of moneyfor a lot of doctors.
And so those are two commonareas where physicians get
(14:24):
burned because they didn't readthe contract or they never got
past the compensation section.
Another problem is with thecompensation.
A will sign a compensation planthat's basically based on
production, and yet there aren'tenough patients for them to see,
even if they can work very hardand very quickly and be
available all the time, therearen't enough patients being
(14:46):
provided by the employer forthem to have high production.
So they end up with very lowcompensation because there just
isn't that much business to do.
And so getting into the detailsof those sorts of
production-based compensationstructures and really finding
out how many patients there areto see at this practice already
(15:06):
that you're going to be alllined up with already, those
sorts of I hear it all the time.
I'm
SPEAKER_00 (15:23):
willing to work hard.
It's on productivity.
I'm willing to work hard.
And it's like, well, that'sgreat.
You know, if no patientspresent.
You know, it doesn't help.
And another thing I see all thetime with covenants not to
compete is it's so outrageous.
I know that the court won'tenforce it.
So I'm not worried about it.
The physician says, well, theproblem is if a new employer
(15:47):
hires you, that employer can getsued for intentional
interference with contractualrelations.
Very few new employers arewilling to say, oh, I talked to
my lawyer.
They said a couple hundredthousand in litigation and we're
going to win.
You know, so we're going to hireyou.
It's the fact that a courtwouldn't enforce a restrictive
covenant has very little to dowith can you get a job in the
(16:09):
area of that restrictivecovenant.
SPEAKER_03 (16:12):
Yeah, that's where the market really drives.
If you have two candidates,let's take the one with less
baggage, that tedious littlerestrictive covenant.
Dennis, we were talking a littlebit before about someone who you
shared an example with me ofsomeone who was potentially
(16:32):
getting ready to lose their jobbecause they weren't working
enough.
And would you share that story?
SPEAKER_00 (16:40):
Well, yeah, you need to be able to audit calculations
of productivity.
I actually had a cardiologist,full-time cardiologist at a
major health center, very, verybusy.
And they called him in and theywere going to fire him because
he wasn't productive.
And they showed him the numbers.
And according to the numbers, itwas very clear in a little
report, he was seeing twopatients a day.
(17:00):
I mean, we had to go in with hisschedule and say, no, no, I'm
fully booked.
That day that i saw too here'smy schedule no cancellations i
was busy all day so it's soimportant that they audit i
literally am working right nowwith this swamped plastic
surgeon.
I mean, just working constantly.
(17:22):
And the hospital gave him a WRVUreport.
And according to the hospital'snumbers, he's at like the 25th
percentile.
I mean, it's just, it'sabsolutely not right.
So a lot of times physicianswill agree that you can pay me
on productivity and they don'thave the ability to audit or, or
(17:42):
challenge the calculation andemployers get it wrong.
So I think that's reallyimportant.
SPEAKER_01 (17:50):
Yeah.
On that, on that same, on thatsame topic, I see a lot of docs,
um, signing, you know, primarilyproductivity-based compensation
agreements when they have noidea how productive they're
going to be.
They've never been out ofresidency kind of situation.
They find out they're not thefastest dock out there.
And they realize that maybe, youknow, even if it had looked like
(18:13):
it was going to pay them less, aguarantee, especially in that
first year or two out ofresidency when they're still
getting their feet under them,can be pretty valuable.
And so I actually encouragepeople to have the you know,
most of their compensation insome sort of a more guaranteed
format for a year or two untilthey get a sense of what their
options are and how productivethey are.
(18:34):
Lots of doctors find out they'remore productive than most of
their peers.
But on the other hand, there'sjust as many that are less
productive than their peers.
And obviously, it's lessadvantageous for them to be in a
compensation, a production-basedcompensation structure.
SPEAKER_00 (18:48):
Yeah.
Well, and as I said, if there'sno patients presenting, you
know, sometimes it's like, well,again, I work hard in residency.
I'm doing, you know, all theseWRVUs.
Well, that's great.
But the hospital decided they'remaking a lot of money on
orthopedic surgeons.
So they hired three of them, youknow, well, you may be willing
to work hard, but you're notgoing to have much to do until
(19:09):
eventually we'll build it.
So absolutely.
I think anytime you're switchingpositions, you should get a
year, or two, if you can,guaranteed salary.
SPEAKER_03 (19:20):
Yeah, you just don't know what you don't know.
And going into it blindly is alittle bit risky financially,
professionally, all of thatstuff.
Because what happens when it'sthe opposite and they're trying
to work you tooth and nail aslong as you think, oh, I can
work hard, but then physicianburnout comes in to play.
And that's not good for anyone.
I think this is where attorneyscan leverage their business
(19:44):
knowledge, right?
I'm not going to go to apodiatrist if I have a heart
issue.
You know, if you have aemployment contract, you need to
be working with an expert and ahealthcare attorney and somebody
who does look at these all day,every day, not just dabbles in
them occasionally.
Dennis, how can you, how can,what can attorneys do better
(20:07):
when working with physicianclients and to get over all
those hurdles that we talkedabout, to show them that you're
not out, you know, it's, it'snot about you out to make, you
know, bill them by the minutefor time and things like that,
how it's truly the approach of awin-win situation.
SPEAKER_00 (20:26):
Well, I think, again, fixed fee is very
important.
But the other thing is, I don'tthink you should expect the
physician to be an interpreter.
So you shouldn't get on thephone and say, well, the problem
with this is this, this, andthis, and you should look at
that, and I'm concerned aboutthis.
I mean, over the years, I'vefound that the best way to help
physicians is I give them aletter with the idea that they
(20:49):
can give that to the employer.
So you don't have to say, I wastalking to him and he said
something about WRVUs.
I don't really, I don't knowwhat that was.
Or I think he said that themedian was this, but I'm not
sure.
I think it's a lot easier togive them something to give to
their employer so that they'renot put in the position of
becoming a legal interpreter.
SPEAKER_03 (21:11):
Yeah, I love that.
And that's a way to conquer theoverwhelm.
The line by line letter so thatthey do know what they're
signing, you know, even if youdon't know the legal language or
what might be missing from thecontract.
Do you see your peers doing thisor when they're working with
physicians or are they givingthem that legal language?
(21:34):
I know when I go into a doctor,it's, you know, I'm taking notes
on what they're saying.
So it's, you know, I can imaginebeing on the other end of that
phone conversation and RVUs andthe media and an MGMA says this.
And how can you point out or howcan attorneys point out
different legal things toprotect their clients without
(21:55):
overwhelming them?
SPEAKER_00 (21:57):
Well, again, I think giving them a letter rather than
requiring them to interpret.
You know, I'm talking to you andI talked to my attorney and he
said something aboutconsultations and it should be
mutual.
You know, I think it's a lotbetter to say the attorney would
like you to say shall bemutually agreed upon.
You know, I think that helpsrather than, again, throwing a
(22:20):
lot, impressing them.
Oh, I know all this legal stuff.
Let me tell you.
And then good luck.
You can try and maybe interpretthat to your boss.
SPEAKER_03 (22:30):
Yeah, nothing.
I'm sure nothing gets lost intranslation that way.
Jim, how can financial advisorsand attorneys elaborate better
to help physicians?
UNKNOWN (22:41):
Yeah.
SPEAKER_01 (22:41):
Yeah, I think the key is if you're going to do
this, do this work, right?
This should be, you know, mostof your practice.
This isn't something that you doone or two of these contracts a
year and expect to be good atit.
If you're really doing thiswell, you've got the
compensation data available.
You can tell the physician whattheir services are worth with
(23:03):
current up-to-date, you know, asmuch data as is available out
there.
You can look at the contract andgo, you know, the last three of
these that I reviewed for a inthe last few months, you know,
we're different in this way andI think yours should be that way
as well.
And I think that experience ofdoing this and seeing, you know,
relationships go bad and havingto go back to the contract and
(23:27):
sort out, you know, what do wedo now, I think is really
valuable.
So I think the first thing to dois, you know, I tell the
doctors, you need to seesomebody that's doing this work.
It needs to be, you know, ahealthcare attorney in your
state or Thank you.
(24:06):
Yeah, absolutely.
(24:35):
The legal services may add up to$100,000 or something.
We're talking a few hundreddollars.
And so I think that's the key isgo hire somebody that does this
all the time and can do it well.
SPEAKER_03 (24:50):
Absolutely.
It's like getting the handymanto come over and do a house
inspection before you buy ahome.
It's like, yeah, I mean, itlooks good.
You knock on the wall.
I've seen a contract before.
I couldn't agree with you more.
How do you see when aphysician's going to get their
contract reviewed and maybethey're already working with a
(25:10):
financial advisor or they havesomebody and instead of siloed
approaches, how can weholistically work with financial
advisors?
How can attorneys work withfinancial advisors to provide
more value to physicians?
SPEAKER_01 (25:26):
I mean, everything downstream, as I mentioned at
the beginning of the podcast,everything downstream is, It
depends on the compensation,right?
So if that financial advisorwants to have a much easier time
with the financial planning,wants to have a much easier time
helping them get to their goalsas far as their asset management
goes, it will help a great dealif they are fairly compensated.
(25:47):
That's definitely step one.
And the truth is the cost of afinancial advisor is generally
dramatically higher than acontract review attorney.
And so I think it's anotherplace that a financial advisor
can provide value to theirclient to point out that, no,
you really do need to get thisreviewed by somebody experienced
(26:08):
in doing this.
And of course, that upfront workwill make what a financial
advisor has to do laterdramatically easier.
It's just far easier to buildwealth and get rid of debt and
reach your financial goals whenyou're being paid fairly for
your services.
And it's appalling to realizehow wide the range is for
(26:28):
physician compensation for docsdoing basically the same work.
It is pretty impressive just howwide that compensation range is.
And part of that is just docsnot getting their contracts
reviewed, signing contracts thatreally aren't treating them
fairly.
SPEAKER_03 (26:47):
Yeah, and you go in and you realize the doctor
you're next to is making a lotmore than you and they
negotiated or they took thateffort and worked with an
attorney and were able to dothat.
Dennis, do you find that youwork with a lot of financial
advisors to sort of proactivelyget ahead of that for education
(27:08):
for physicians?
SPEAKER_00 (27:09):
No, most of the time, just like Jim says, they
say, look, This is important.
You should get somebody that hasthe data.
Very few financial advisors aregoing to have MGMA benchmarks,
for instance.
So most of them do say, look,give it to the attorney.
I'll look at it, see if there'sanything that I saw.
But very rarely do I have afinancial advisor come back and
(27:31):
say, hey, this is a financialissue which you should discuss.
SPEAKER_01 (27:36):
Yeah, it might be nice to have the advisor weigh
in on the quality of theretirement accounts or the
health insurance plan and theHSA being offered by the
employer.
That might be some usefulinformation to have them point
out, hey, your retirementaccount's kind of stinky
compared to most of my clients.
That might be a usefulcollaboration that could take
(27:58):
place as part of that.
But I think for the most part,the role of the financial
advisor is getting the clientinto the hands of the client.
contract review attorney.
SPEAKER_03 (28:08):
Yeah, I love that.
It's one of the things if you'reworking with somebody who
dabbles, they don't have theirown benchmark data to see what
industry standards are.
If they're just doing anddabbling here and there, they
just don't have that informationand knowledge.
I would love to hear what, ifsomeone was listening right now,
(28:29):
and Dennis, I'll let you take itfrom the perspective attorney
side of what is the first stepthat you should take when
exploring the possibility of, ofmaybe working exclusively with
physicians?
SPEAKER_00 (28:43):
Are you talking about an attorney?
SPEAKER_03 (28:48):
Yes.
You take the attorneyperspective.
We'll give Jim.
SPEAKER_00 (28:51):
It's a little hard, but I mean, the way I did it was
at some point I just decidedthis is what I want to do.
You know, it's, it's a longstory, but my, my kid, my, was
life and death for quite awhile.
And that's when I really got towork with physicians other than
transactionally, sitting by thebedside one night in particular.
(29:11):
So I think part of it is youhave to really believe in what
they're doing.
I mean, if you think these guysin the white coats are just high
paid technicians that come inand slap a prescription at you,
then you might be a really goodcontract attorney, but maybe
this isn't the area for you.
So I think, first of all, youhave to have an empathy for the
(29:33):
physicians.
And it certainly helps if you'vedealt with them a lot and you
have some sense of what theirlife is.
SPEAKER_03 (29:41):
Yeah, I love that.
And now, Jim, for you, from thephysician perspective, how do
you...
Sorry, go ahead.
SPEAKER_01 (29:52):
I mean, step one is...
If you're getting a new job oryou're joining a partnership,
get the stupid contractreviewed, right?
I mean, it really is thatsimple.
You just got to go do this.
You got to do a few things inyour financial life.
You know, you got to go buy somedisability insurance.
You just have to do it.
You have to figure out how yourretirement plan works and you
have to put some money in thereand you have to get your
(30:14):
contract reviewed.
It really is that simple.
But what often happens issomebody listening to a podcast
like this, they realize, oh, Ididn't get my contract reviewed.
Maybe I'm not being paid fairly.
And they start looking aroundand asking questions.
Well, it would still beworthwhile to spend some time to
go over what your contract saysso you understand, you know,
(30:36):
what will happen if, you know,you'd have to go to the contract
and follow its terms because therelationship is breaking up or
something.
But oftentimes there can berenegotiations, you know, after
a year or two or three or five.
And, you know, they want you tokeep working there and it's
worth getting an improvedcontract.
So getting it reviewed, evenafter you've signed it, can
(30:58):
still be worthwhile, even ifit's obviously much harder to
change after you've signed itthan it was beforehand.
But there's usually some sort ofan out and you're not completely
out of options just becauseyou've already signed the
contract.
So I think the key is no matterwhere you're at in your career,
in your employment process, it'sworth knowing how these work and
(31:20):
doing everything you can to makesure that it's working out for
you.
as well as it can.
And the truth is, this is notnecessarily an antagonistic
process, right?
The employer, if they're smart,Wants you happy because they
don't want to have to hireanother doc.
It's expensive to go findanother doc.
(31:40):
It's not unusual for them tospend$50,000 recruiting a new
doctor to a position and payinga headhunter and those sorts of
things.
They don't want you to leaveeither.
They'd rather pay you less andhave you be happy and work hard
for them, but they don't wantyou to leave.
And so it really makes sense toturn any negotiation like this
into a win-win where it's goingto be a fruitful, profitable,
(32:03):
happy, long-term relationship.
And so that's what you'reworking with in a physician
contract negotiation situation.
And I think it's important torealize that up front, that it's
to the employer's benefit aswell for the physician to be
happy.
It's not going to do you anygood to have a bunch of docs
that are not happy with you.
It's going to create far moreproblems than it's going to save
(32:25):
you money.
SPEAKER_03 (32:25):
Yeah, I couldn't agree more.
Everybody wants that win-win.
Everybody wants to be happy.
They don't want to go find theirnew doctor.
Dennis, that brings me tosomething that I know you see a
lot of somebody just gets acontract and they want to sign
on the dotted line as soon aspossible, especially residents
and fellows coming out oftraining because they have a job
offer.
They've done all this work andnow they have to sign and the
(32:49):
recruiter might have said, Ican't negotiate.
This is their standard contract.
and I can't change it.
What do you say to thosephysicians?
SPEAKER_00 (32:58):
The recruiter's probably telling the truth.
The recruiter probably can'tchange it.
What the recruiter didn'tmention is for it to get
changed, I'd have to send it tolegal.
So, you know, probably not lyingwhen I say this is the contract
and I can't change it, but thatworks.
And anecdotally, I'm guessing40% of all physicians just sign
what's handed to them.
(33:18):
Again, I've never seen a survey,but that's my sense that, well,
they said it was a standardcontract.
And I talked to one of thepeople, you know, in my
graduating class and they weregetting paid the same I was.
So, you know, I thinkeverything's fine.
But that's probably the biggestissue that I see is not, again,
(33:39):
the recruiter's not lying, butit may not be the whole story.
SPEAKER_03 (33:43):
Yeah.
Yeah.
You
SPEAKER_01 (33:48):
know, there's usually some place where the
contract can be improved.
Maybe they can't pay you moresalary, but maybe you can have
some more time off.
Right.
Or maybe you can have, you know,a larger continuing medical
education allowance or, youknow, maybe you can have some
more assistance.
in your clinic, making your lifedramatically better because you
(34:08):
have an extra medical assistant.
Things like that can often beadded to a contract, even when
for some reason you'renegotiating partner slash
opponent has their hands tiedwith one aspect of the contract.
Often they don't have theirhands tied with many other areas
of the contract.
So I think absolutely the mythof the standard contract really
is out there.
And the truth is most contractscan be changed in a lot of ways,
(34:32):
maybe not every way, but in alot of ways they can.
For example, let me tell youabout a contract I signed 15
years ago.
My physician partnershipcontract had a non-compete in
it.
And I'm an emergency doctor,right?
A non-compete is like thedumbest thing ever for a
hospital-based physician likeme.
Nobody is coming to the hospitalbecause they want to see me
(34:54):
individually.
When I leave the hospital, I'mnot taking any business away
from the hospital.
I'm not taking any patients withme whatsoever.
And so I brought this up duringthe negotiation process.
And I'm like, what exactly areyou guys worried about?
Well, it turned out what theywere worried about was me
stealing the contract from thehospital and bringing in a new
group of emergency physicians tostaff that contract.
(35:17):
So we rewrote the non-competeagreement to say that I couldn't
do that.
Not that I couldn't work in thecity should we decide to part
ways.
And everybody was happy.
It's amazing, though, that nophysician...
Prior to me in this partnership,dozens and dozens of physicians
had ever balked at thatnon-compete agreement in the
(35:39):
past.
And so it kind of became the newstandard way that it was
written, was the way that Idemanded it to be written when I
was hired.
So just realize that you havemore power than you think.
Remember, as you're signingthese contracts, it is costing
them a lot of money to get youor somebody like you in the
door.
And so it's not insignificant,the power you have in the
(36:01):
negotiation.
I
SPEAKER_03 (36:03):
love that you just asked the question, like, what
are you worried about?
Because I think sometimes itcomes down to communication or a
lack thereof of like, what isthe concern here?
Because my concern is that Ineed to go work at a hospital
and I don't want to have tochange schools for my kids.
But what are you concernedabout?
And actually getting to thebottom of it is an incredible
concern.
(36:23):
that most physicians just don'task for.
SPEAKER_01 (36:27):
Another great question is, is that the best
you can do?
I'm amazed how much better thedeal comes back without anything
other than, is that the best youcan do?
SPEAKER_03 (36:36):
Definitely step one that I would say.
Is that your best?
Dennis, when you go into acontract negotiation, are you
just asking for one thing?
SPEAKER_00 (36:50):
No, my letter covers everything.
I mean, every...
every clause that could bebetter or more balanced or more
favorable to the physician Iasked for it.
I don't expect, you know,probably in my career, I've had
about three times where theygave us everything we asked for,
but they'll give you some andanything they give you makes it
(37:10):
better.
And I tell physicians, if youwant to negotiate, it's a lot
easier to negotiate with aletter that has 35 bullet points
and say, okay, I'll give youthat.
I'll give you that.
I'll give you that.
Okay.
No, this one, no.
No, we have to talk about thisone.
You know, it just makes yourposture a lot better than what I
always caution my clients not todo is read my letter, decide
(37:32):
what's important to them, andthen go to the employer with
those.
Because if you think about it,if we're negotiating and I come
to you and say, Sarah, there'sfour things that's really
important to me.
Well, if you give me two ofthem, you're going to say,
Dennis, I met you halfway.
you know, now you lookunreasonable.
Whereas if there were 35 and Istand firm on four, you know, it
just changes, I think, the easeof the negotiation.
SPEAKER_03 (37:56):
Yeah, it definitely takes out that confrontational
element when, well, these are mysolid.
We can let the other stuff go,but these four have to slide
through.
This is so awesome.
So final thoughts when it comesto physician contracts.
Dennis, what is one thing thatyou or your final thought on
just the topic in general?
SPEAKER_00 (38:16):
There's no standard contract generally.
Even if the language isstandard, as Jim pointed out, a
lot of times they can do otherthings for you to make your life
better.
So I think the first thing tome, the number one thing is
don't accept the standardcontract line.
SPEAKER_03 (38:32):
And Jim, I can almost already hear what you're
going to say, but can we haveyour final thoughts when it
comes to physician contract, howa physician or how they should
approach it or what they shoulddo?
SPEAKER_01 (38:45):
Yeah, first for the physicians, get your stupid
contract reviewed.
That part's pretty easy.
For the attorneys, if you'regoing to do this, do this right.
Make this your entire practiceor the majority of your practice
so you really are well-versedwith the ins and outs and the
changes in these contracts overthe years.
Make sure you have access toMGMA and similar data.
(39:07):
You do enough of these, you'llhave your own in-house data of
what a fair contract contractlooks like.
And, uh, and you'd be surprisedyou treat physicians.
Well, they will send all theirfriends to you and you will
have, you know, a wonderfulpractice doing great work.
You treat people poorly and, andit'll be amazing how few clients
(39:28):
you get ever again.
SPEAKER_03 (39:29):
Yeah.
Great lessons, even for life.
Uh, I want to thank you both somuch for your time today.
Thank you to the audience that'slistened and stay tuned.
And, uh, we appreciate you somuch.
Thanks so much guys.
UNKNOWN (39:43):
Thank you.
SPEAKER_02 (39:47):
To subscribe and add this private podcast feed to
(40:13):
your podcast app, go toAmericanHealthLaw.org slash
Daily Podcast.
you
This episode of AHLA's Speaking of Health Law is
brought to you by AHLA membersand donors like you.
For more information, visitAmericanHealthLaw.org.
SPEAKER_03 (00:17):
Hi, everyone.
I'm Sarah Laws, CEO of DecisionProsperity, and today I'm joined
by Dennis Hirsch and Jim Dolleyto talk about leveling the
playing field.
How can attorneys...
empower physicians in employmentnegotiations.
Dennis is a veteran physician'slawyer.
He's vice chair of the Labor andEmployment Practice Group with
the AHLA, and he's the author ofThe Final Hurdle, A Physician's
(00:40):
Guide to Negotiating a FairEmployment Agreement.
Jim Dolley is a practicingemergency physician and the
founder of White Coat Investor,the most widely read
physician-specific personalfinance and investing website in
the world.
So guys, thanks for joining metoday.
We're excited to be here.
Before we jump in, I'd love tohave each one of you just share
(01:01):
why this topic matters to youpersonally.
SPEAKER_00 (01:03):
Well, I can start first.
I mean, what I do is reviewingemployment agreements, and I see
so many horrible agreements thatthe physician is renewing and
the first agreement is justhorrible.
So I think it's really importantthat we get the word out to the
lawyers that are representingphysicians that there are things
(01:26):
you can do and go for it.
SPEAKER_01 (01:30):
Yeah, I'm a firm believer that A physician that
is financially comfortable, thatis financially stable, that has
their financial ducks in a row,however you want to describe it,
is a better doctor.
They're a better parent.
They're a better partner.
They're a better doctor.
They get better medical carewhen they're less worried about
their finances.
(01:50):
And the first thing you got todo to have finances is to make
some money.
And it's hard to do that withoutsome sort of employment or
partnership contract.
So if things break down right atthe beginning of the process of
building some sort of wealth orsome sort of financial
stability, the rest of itdoesn't go very well.
And so physician contracts,physician negotiations for
(02:13):
employment, it's all animportant part of the process.
SPEAKER_03 (02:15):
Absolutely.
And I couldn't agree with youmore.
You can't be giving your best ofyourself to your patients, to
your family, to everybody ifyou're worried about your
financial things that typedirectly into contracts.
Let's talk about what physiciansdon't know that can hurt them.
Dennis, there's this illusion ofthe standard contract.
(02:37):
When you first read anemployment contract, what are
you scanning for in the firstfive minutes?
Are you just skimming thedocuments?
Any clauses you consider dealbreakers?
SPEAKER_00 (02:46):
Well, no.
The way I do it is I prepare adetailed letter on law firm
stationery that I send to thephysician with the idea that the
physician will just take myletter and send it to the
employer.
So I don't actually skim.
I start at section one and startgoing through and saying, hey,
what can we do to make thisbetter for the physician?
SPEAKER_03 (03:06):
What?
You don't just skim throughlike, where's that salary?
SPEAKER_00 (03:13):
Good.
They said it was a standardcontract.
So there's no sense talkingabout this, I guess.
UNKNOWN (03:17):
Yeah.
SPEAKER_03 (03:17):
Jim, you have worked alongside thousands of
physicians.
What feelings do doctorscommonly have about their
employment contracts?
Do they know what they'resigning?
Is it really just a big questionmark?
SPEAKER_01 (03:32):
You know, Dennis might look at these things all
day long.
But a typical physician onlylooks at these things once,
twice, three times in theircareer.
This is a foreign language tothem most of the time.
And obviously they speakEnglish.
They understand some of thecontract, but there's a lot of
it they don't understand.
And the issue is the contractcomes up when things aren't
working out.
You know, when everything'sgreat, nobody needs a contract,
(03:54):
right?
But when things are not workingout is when people go to the
contract and find out what theyactually signed.
And so it's a lot of times it'sthe terms about the breakup, how
this relationship ends, that isthe first thing the physicians
notice.
And often it's way too late tomake any changes to the contract
at that point.
SPEAKER_03 (04:14):
Yeah, it's one of those nicely into a mindset
where I'm guessing you justdon't get a lot of business
training and legal training inmed school, which is great.
I mean, you shouldn't come outwith all this debt and all of
this.
SPEAKER_01 (04:30):
Yeah, it'd be nice to get a little bit of that
training, right?
I agree they don't get any, butthey do need a little bit.
Maybe that shouldn't be thefocus of medical school and
residency, but is it too much toask for an hour a year?
I don't think so.
And doctors are not even gettingthat.
SPEAKER_03 (04:44):
Yeah, and I think that's where lawyers can really
and attorneys can take someproactive steps with educating.
their clients and overcoming themindset and misconceptions.
I'm sure there's quite a fewmisconceptions about working
with attorneys and how thatgoes.
Not
SPEAKER_00 (05:03):
saying- No, physicians love attorneys.
SPEAKER_03 (05:06):
Not saying they're not everyone's favorite, but
Dennis, what do you think mostphysicians underestimate how
negotiable their contracts are?
Are they negotiable?
If somebody's working with you,have you ever seen a contract
not be changed when you've askedfor something.
SPEAKER_00 (05:25):
Actually, I have.
I've done, I don't know,thousands and thousands.
I'm guessing around 4,000 maybecontracts.
And I can count.
I used to say on one hand, butI've been doing it 40 years.
So now I could probably count ontwo hands the times that they've
come back and said, no, that'sour standard contract.
We don't change anything.
And many times, even on thosecontracts, they'll change the
(05:47):
compensation.
You can say, well, look, it'sbelow median signing bonus.
Sometimes they'll at leastchange the money.
But By far, I would guess 99.9%of the contracts that I've
looked at, the employers arewilling to make changes.
SPEAKER_03 (06:03):
I'm sure that has to put some skepticism in there for
physicians of what if I workwith an attorney and they don't
make any changes and I've spentall this money and all this time
and they're not going to changeit.
Jim, do you think thatphysicians could avoid legal
help because of the cost or theydon't see the value?
I
SPEAKER_01 (06:21):
do think that is a problem.
they become penny wise and poundfoolish, right?
I mean, a contract reviewservice typically only costs a
few hundred dollars, right?
You're going to make this backthe first morning you're in this
job, right?
It does not, this is not a hugeinvestment.
As financial services go, thisis one of the cheaper ones.
(06:41):
And so pretty much every docsigning a contract ought to have
it reviewed.
You know, this has beenconsistent messaging.
I've been given to docs for thelast 15 years since the White
Coat Investor was founded.
But, you know, it's interestingbecause the first question you
often hear from a doctor is, isthis negotiable?
And the problem is they assumethat negotiation is just kind of
(07:06):
asking for more, whereasnegotiation is a much more
in-depth process of knowing whatyou want and knowing what you're
worth, what the going rate isand what a typical contract
looks at.
And that's where an attorney canhelp because, you know, at least
most of them that are doing thiswork a lot have seen far more
contracts than the physicianshave and often have access to
(07:29):
data that helps the doctor toknow what they're worth.
I mean, obviously a doctorthat's being underpaid by 30%
should negotiate that salary.
A physician who's been made afirst offer that's actually a
very fair offer or even betterthan a fair offer, maybe they
ought to spend their negotiationon other points of that contract
rather than purely salary.
(07:49):
But the problem is so many docs,they don't have any of the
background information theyneed.
And so the employer is far moreempowered in the negotiation
than the contracting physicianis.
SPEAKER_03 (08:02):
Yeah.
And they have a whole teambehind them and they're trying
to get their best deal.
And it's, you know, I, I knowthat you're both like, how can
everybody come out with a fairdeal?
Like everybody should be happy.
You don't, you don't want anemployer that is going to
squeeze the physician to get themost out of them.
Like let's, let's create along-term working relationship
here.
Dennis, I know that yourcontract review is, is fixed
(08:23):
fee, which kind of alleviatessome of that question mark for a
physician of how much is thisgoing to cost me?
Cause traditionally, you know,our, our attorney's bill by the
hour.
And it's like, I might be agingmyself, but the, the old
commercial where it was, we hada baby eats a boy when they
were, they're calling, callingon a collect phone call of
(08:45):
trying to get through somethingas fast as possible.
And I think when you positionyourself like that, it's how can
you provide value to theattorney or to your, your
clients as the attorney that isauthoritative and not, you're
just trying to keep them on thephone as long as you can.
Cause you you want yourbillables to be up.
Do you ever get any questionsabout why you don't charge
(09:08):
hourly?
SPEAKER_00 (09:11):
Sometimes.
It's usually the other side.
Mine's simple.
It's a six-page contract.
I understand if it was a bigcontract, but I see people
getting 20-page.
Why are you...
Well, if it's six pages, there'sa lot of stuff that's not
addressed.
So sometimes I get the flipside.
Well, mine's really simple.
And you know, that's maybe aproblem, Doc.
(09:35):
You know, maybe there should bea little complexity in there.
You know, a little bit aboutwhat your rights are and some
limits on the employer.
So, unfortunately, I get it theother way.
I mean, a lot of physicians arehappy that, oh, I forgot to tell
you, you know, this, that, oh,yeah, I got your letter, but,
you know, I didn't mention theysaid I could work four days a
(09:55):
week.
And that's not, you didn'tmention that in the letter.
It's like, well, because Ididn't know it.
So, yeah, I think generallythey, they like it, but
sometimes I get the opposite.
It's like mine short and easy.
So no big
SPEAKER_03 (10:09):
deal.
Everybody wants a good deal.
So you're like, but you don'thave to read 27 pages of a
contract.
Surely I can get, I can get adiscount.
Yeah.
I, I appreciate their, their,you know, tenacity.
Let's talk about how financialliteracy and legal literacy go
(10:30):
hand in hand.
Dennis, how would you describethe connection between the two?
Do they go hand in hand?
I can't imagine signing anemployment contract and not
being concerned at all with thefinancial impact.
SPEAKER_00 (10:42):
Yeah, well, a lot of times physicians are happy if it
says we, the employer, willdetermine this after
consultation.
So they say, oh, no, they'regoing to talk to me.
It's like, well, that's fine.
You know, hey, we just bought anew hospital 50 miles out of
town and you're going thereevery Thursday.
How do you feel about that?
I don't like it.
Okay, good talk.
(11:03):
I'm glad we had this consult,you know, next Thursday.
I'm sending you to thathospital.
So they tend to think, oh, Ihave input.
So since I have input, the twoof us will jointly do it.
You know, if it doesn't saymutually agree, if it says
after, many times it just sayswe'll determine.
We'll send you wherever.
Your hours will be whatever wedetermine.
(11:23):
You know, you're calling us.
All coverage will be whatever wedetermine.
But sometimes physicians aretricked that, you know, after
input from physicians or afterconsultation with physicians and
they feel they're protected andthey're not really.
SPEAKER_03 (11:36):
Yeah.
And as these medical networksexpand and get bigger and
bigger, like it's, it's a realpotential risk for a physician
to get moved all the way acrossthe state.
I know where I am, you can'tswing a bat without hitting two
big medical industries and thatcan be really scary.
And that goes back to what thedoctors don't know and how
(11:56):
attorneys can empower thembecause again, they don't, they
just don't teach that stuff inmed school.
UNKNOWN (12:02):
Yeah.
SPEAKER_03 (12:03):
Jim, what's at stake if a physician just blindly
signs?
They see that number, they'relike, no, they have my best
intentions.
This person is absolutely great.
What are the financial potentialrisks or have you seen any
examples of when they don't geta contract, physicians don't get
a contract review and they goahead and sign and then they're
(12:23):
in it and it's backfired?
SPEAKER_01 (12:25):
Yeah, absolutely.
(12:55):
When this job agreement breaksup, you know, they cannot take
another job in the place wherethey live.
And you think about thefinancial ramifications of that.
Not only are you going to haveto recredential, maybe get a
license in a new state thatyou're going to be out of work
for months doing all that, butyou're going to have to pick up
your family and move.
And maybe your spouse is goingto have to change jobs.
(13:18):
You're going to lose a bunch oftransaction costs on housing.
It can be a very expensivemistake to be in any sort of
restrictive covenant that'sgoing to cause you to have to
change where you live in orderto continue to be employed.
Another big error we seephysicians make is that they
don't know how malpracticeinsurance works.
(13:42):
There are claims-made policies.
There are occurrence policies.
And if the policy provided toyou is a claims-made policy,
somebody's going to have to buya tail when you stop working
there, when that policy ends.
Otherwise, you're exposed toclaims that come in after
employment stops.
And that happens all the time,that a malpractice claim will
come in afterward.
And physicians have no idea...
(14:04):
What tail coverage actuallycosts.
It often costs two or threetimes the annual premium for the
malpractice insurance.
So it wouldn't be unusual for aphysician to find out that when
they leave this employer,they've got to come up with
$50,000 to buy their tailcoverage.
And that can be a lot of moneyfor a lot of doctors.
And so those are two commonareas where physicians get
(14:24):
burned because they didn't readthe contract or they never got
past the compensation section.
Another problem is with thecompensation.
A will sign a compensation planthat's basically based on
production, and yet there aren'tenough patients for them to see,
even if they can work very hardand very quickly and be
available all the time, therearen't enough patients being
(14:46):
provided by the employer forthem to have high production.
So they end up with very lowcompensation because there just
isn't that much business to do.
And so getting into the detailsof those sorts of
production-based compensationstructures and really finding
out how many patients there areto see at this practice already
(15:06):
that you're going to be alllined up with already, those
sorts of I hear it all the time.
I'm
SPEAKER_00 (15:23):
willing to work hard.
It's on productivity.
I'm willing to work hard.
And it's like, well, that'sgreat.
You know, if no patientspresent.
You know, it doesn't help.
And another thing I see all thetime with covenants not to
compete is it's so outrageous.
I know that the court won'tenforce it.
So I'm not worried about it.
The physician says, well, theproblem is if a new employer
(15:47):
hires you, that employer can getsued for intentional
interference with contractualrelations.
Very few new employers arewilling to say, oh, I talked to
my lawyer.
They said a couple hundredthousand in litigation and we're
going to win.
You know, so we're going to hireyou.
It's the fact that a courtwouldn't enforce a restrictive
covenant has very little to dowith can you get a job in the
(16:09):
area of that restrictivecovenant.
SPEAKER_03 (16:12):
Yeah, that's where the market really drives.
If you have two candidates,let's take the one with less
baggage, that tedious littlerestrictive covenant.
Dennis, we were talking a littlebit before about someone who you
shared an example with me ofsomeone who was potentially
(16:32):
getting ready to lose their jobbecause they weren't working
enough.
And would you share that story?
SPEAKER_00 (16:40):
Well, yeah, you need to be able to audit calculations
of productivity.
I actually had a cardiologist,full-time cardiologist at a
major health center, very, verybusy.
And they called him in and theywere going to fire him because
he wasn't productive.
And they showed him the numbers.
And according to the numbers, itwas very clear in a little
report, he was seeing twopatients a day.
(17:00):
I mean, we had to go in with hisschedule and say, no, no, I'm
fully booked.
That day that i saw too here'smy schedule no cancellations i
was busy all day so it's soimportant that they audit i
literally am working right nowwith this swamped plastic
surgeon.
I mean, just working constantly.
(17:22):
And the hospital gave him a WRVUreport.
And according to the hospital'snumbers, he's at like the 25th
percentile.
I mean, it's just, it'sabsolutely not right.
So a lot of times physicianswill agree that you can pay me
on productivity and they don'thave the ability to audit or, or
(17:42):
challenge the calculation andemployers get it wrong.
So I think that's reallyimportant.
SPEAKER_01 (17:50):
Yeah.
On that, on that same, on thatsame topic, I see a lot of docs,
um, signing, you know, primarilyproductivity-based compensation
agreements when they have noidea how productive they're
going to be.
They've never been out ofresidency kind of situation.
They find out they're not thefastest dock out there.
And they realize that maybe, youknow, even if it had looked like
(18:13):
it was going to pay them less, aguarantee, especially in that
first year or two out ofresidency when they're still
getting their feet under them,can be pretty valuable.
And so I actually encouragepeople to have the you know,
most of their compensation insome sort of a more guaranteed
format for a year or two untilthey get a sense of what their
options are and how productivethey are.
(18:34):
Lots of doctors find out they'remore productive than most of
their peers.
But on the other hand, there'sjust as many that are less
productive than their peers.
And obviously, it's lessadvantageous for them to be in a
compensation, a production-basedcompensation structure.
SPEAKER_00 (18:48):
Yeah.
Well, and as I said, if there'sno patients presenting, you
know, sometimes it's like, well,again, I work hard in residency.
I'm doing, you know, all theseWRVUs.
Well, that's great.
But the hospital decided they'remaking a lot of money on
orthopedic surgeons.
So they hired three of them, youknow, well, you may be willing
to work hard, but you're notgoing to have much to do until
(19:09):
eventually we'll build it.
So absolutely.
I think anytime you're switchingpositions, you should get a
year, or two, if you can,guaranteed salary.
SPEAKER_03 (19:20):
Yeah, you just don't know what you don't know.
And going into it blindly is alittle bit risky financially,
professionally, all of thatstuff.
Because what happens when it'sthe opposite and they're trying
to work you tooth and nail aslong as you think, oh, I can
work hard, but then physicianburnout comes in to play.
And that's not good for anyone.
I think this is where attorneyscan leverage their business
(19:44):
knowledge, right?
I'm not going to go to apodiatrist if I have a heart
issue.
You know, if you have aemployment contract, you need to
be working with an expert and ahealthcare attorney and somebody
who does look at these all day,every day, not just dabbles in
them occasionally.
Dennis, how can you, how can,what can attorneys do better
(20:07):
when working with physicianclients and to get over all
those hurdles that we talkedabout, to show them that you're
not out, you know, it's, it'snot about you out to make, you
know, bill them by the minutefor time and things like that,
how it's truly the approach of awin-win situation.
SPEAKER_00 (20:26):
Well, I think, again, fixed fee is very
important.
But the other thing is, I don'tthink you should expect the
physician to be an interpreter.
So you shouldn't get on thephone and say, well, the problem
with this is this, this, andthis, and you should look at
that, and I'm concerned aboutthis.
I mean, over the years, I'vefound that the best way to help
physicians is I give them aletter with the idea that they
(20:49):
can give that to the employer.
So you don't have to say, I wastalking to him and he said
something about WRVUs.
I don't really, I don't knowwhat that was.
Or I think he said that themedian was this, but I'm not
sure.
I think it's a lot easier togive them something to give to
their employer so that they'renot put in the position of
becoming a legal interpreter.
SPEAKER_03 (21:11):
Yeah, I love that.
And that's a way to conquer theoverwhelm.
The line by line letter so thatthey do know what they're
signing, you know, even if youdon't know the legal language or
what might be missing from thecontract.
Do you see your peers doing thisor when they're working with
physicians or are they givingthem that legal language?
(21:34):
I know when I go into a doctor,it's, you know, I'm taking notes
on what they're saying.
So it's, you know, I can imaginebeing on the other end of that
phone conversation and RVUs andthe media and an MGMA says this.
And how can you point out or howcan attorneys point out
different legal things toprotect their clients without
(21:55):
overwhelming them?
SPEAKER_00 (21:57):
Well, again, I think giving them a letter rather than
requiring them to interpret.
You know, I'm talking to you andI talked to my attorney and he
said something aboutconsultations and it should be
mutual.
You know, I think it's a lotbetter to say the attorney would
like you to say shall bemutually agreed upon.
You know, I think that helpsrather than, again, throwing a
(22:20):
lot, impressing them.
Oh, I know all this legal stuff.
Let me tell you.
And then good luck.
You can try and maybe interpretthat to your boss.
SPEAKER_03 (22:30):
Yeah, nothing.
I'm sure nothing gets lost intranslation that way.
Jim, how can financial advisorsand attorneys elaborate better
to help physicians?
UNKNOWN (22:41):
Yeah.
SPEAKER_01 (22:41):
Yeah, I think the key is if you're going to do
this, do this work, right?
This should be, you know, mostof your practice.
This isn't something that you doone or two of these contracts a
year and expect to be good atit.
If you're really doing thiswell, you've got the
compensation data available.
You can tell the physician whattheir services are worth with
(23:03):
current up-to-date, you know, asmuch data as is available out
there.
You can look at the contract andgo, you know, the last three of
these that I reviewed for a inthe last few months, you know,
we're different in this way andI think yours should be that way
as well.
And I think that experience ofdoing this and seeing, you know,
relationships go bad and havingto go back to the contract and
(23:27):
sort out, you know, what do wedo now, I think is really
valuable.
So I think the first thing to dois, you know, I tell the
doctors, you need to seesomebody that's doing this work.
It needs to be, you know, ahealthcare attorney in your
state or Thank you.
(24:06):
Yeah, absolutely.
(24:35):
The legal services may add up to$100,000 or something.
We're talking a few hundreddollars.
And so I think that's the key isgo hire somebody that does this
all the time and can do it well.
SPEAKER_03 (24:50):
Absolutely.
It's like getting the handymanto come over and do a house
inspection before you buy ahome.
It's like, yeah, I mean, itlooks good.
You knock on the wall.
I've seen a contract before.
I couldn't agree with you more.
How do you see when aphysician's going to get their
contract reviewed and maybethey're already working with a
(25:10):
financial advisor or they havesomebody and instead of siloed
approaches, how can weholistically work with financial
advisors?
How can attorneys work withfinancial advisors to provide
more value to physicians?
SPEAKER_01 (25:26):
I mean, everything downstream, as I mentioned at
the beginning of the podcast,everything downstream is, It
depends on the compensation,right?
So if that financial advisorwants to have a much easier time
with the financial planning,wants to have a much easier time
helping them get to their goalsas far as their asset management
goes, it will help a great dealif they are fairly compensated.
(25:47):
That's definitely step one.
And the truth is the cost of afinancial advisor is generally
dramatically higher than acontract review attorney.
And so I think it's anotherplace that a financial advisor
can provide value to theirclient to point out that, no,
you really do need to get thisreviewed by somebody experienced
(26:08):
in doing this.
And of course, that upfront workwill make what a financial
advisor has to do laterdramatically easier.
It's just far easier to buildwealth and get rid of debt and
reach your financial goals whenyou're being paid fairly for
your services.
And it's appalling to realizehow wide the range is for
(26:28):
physician compensation for docsdoing basically the same work.
It is pretty impressive just howwide that compensation range is.
And part of that is just docsnot getting their contracts
reviewed, signing contracts thatreally aren't treating them
fairly.
SPEAKER_03 (26:47):
Yeah, and you go in and you realize the doctor
you're next to is making a lotmore than you and they
negotiated or they took thateffort and worked with an
attorney and were able to dothat.
Dennis, do you find that youwork with a lot of financial
advisors to sort of proactivelyget ahead of that for education
(27:08):
for physicians?
SPEAKER_00 (27:09):
No, most of the time, just like Jim says, they
say, look, This is important.
You should get somebody that hasthe data.
Very few financial advisors aregoing to have MGMA benchmarks,
for instance.
So most of them do say, look,give it to the attorney.
I'll look at it, see if there'sanything that I saw.
But very rarely do I have afinancial advisor come back and
(27:31):
say, hey, this is a financialissue which you should discuss.
SPEAKER_01 (27:36):
Yeah, it might be nice to have the advisor weigh
in on the quality of theretirement accounts or the
health insurance plan and theHSA being offered by the
employer.
That might be some usefulinformation to have them point
out, hey, your retirementaccount's kind of stinky
compared to most of my clients.
That might be a usefulcollaboration that could take
(27:58):
place as part of that.
But I think for the most part,the role of the financial
advisor is getting the clientinto the hands of the client.
contract review attorney.
SPEAKER_03 (28:08):
Yeah, I love that.
It's one of the things if you'reworking with somebody who
dabbles, they don't have theirown benchmark data to see what
industry standards are.
If they're just doing anddabbling here and there, they
just don't have that informationand knowledge.
I would love to hear what, ifsomeone was listening right now,
(28:29):
and Dennis, I'll let you take itfrom the perspective attorney
side of what is the first stepthat you should take when
exploring the possibility of, ofmaybe working exclusively with
physicians?
SPEAKER_00 (28:43):
Are you talking about an attorney?
SPEAKER_03 (28:48):
Yes.
You take the attorneyperspective.
We'll give Jim.
SPEAKER_00 (28:51):
It's a little hard, but I mean, the way I did it was
at some point I just decidedthis is what I want to do.
You know, it's, it's a longstory, but my, my kid, my, was
life and death for quite awhile.
And that's when I really got towork with physicians other than
transactionally, sitting by thebedside one night in particular.
(29:11):
So I think part of it is youhave to really believe in what
they're doing.
I mean, if you think these guysin the white coats are just high
paid technicians that come inand slap a prescription at you,
then you might be a really goodcontract attorney, but maybe
this isn't the area for you.
So I think, first of all, youhave to have an empathy for the
(29:33):
physicians.
And it certainly helps if you'vedealt with them a lot and you
have some sense of what theirlife is.
SPEAKER_03 (29:41):
Yeah, I love that.
And now, Jim, for you, from thephysician perspective, how do
you...
Sorry, go ahead.
SPEAKER_01 (29:52):
I mean, step one is...
If you're getting a new job oryou're joining a partnership,
get the stupid contractreviewed, right?
I mean, it really is thatsimple.
You just got to go do this.
You got to do a few things inyour financial life.
You know, you got to go buy somedisability insurance.
You just have to do it.
You have to figure out how yourretirement plan works and you
have to put some money in thereand you have to get your
(30:14):
contract reviewed.
It really is that simple.
But what often happens issomebody listening to a podcast
like this, they realize, oh, Ididn't get my contract reviewed.
Maybe I'm not being paid fairly.
And they start looking aroundand asking questions.
Well, it would still beworthwhile to spend some time to
go over what your contract saysso you understand, you know,
(30:36):
what will happen if, you know,you'd have to go to the contract
and follow its terms because therelationship is breaking up or
something.
But oftentimes there can berenegotiations, you know, after
a year or two or three or five.
And, you know, they want you tokeep working there and it's
worth getting an improvedcontract.
So getting it reviewed, evenafter you've signed it, can
(30:58):
still be worthwhile, even ifit's obviously much harder to
change after you've signed itthan it was beforehand.
But there's usually some sort ofan out and you're not completely
out of options just becauseyou've already signed the
contract.
So I think the key is no matterwhere you're at in your career,
in your employment process, it'sworth knowing how these work and
(31:20):
doing everything you can to makesure that it's working out for
you.
as well as it can.
And the truth is, this is notnecessarily an antagonistic
process, right?
The employer, if they're smart,Wants you happy because they
don't want to have to hireanother doc.
It's expensive to go findanother doc.
(31:40):
It's not unusual for them tospend$50,000 recruiting a new
doctor to a position and payinga headhunter and those sorts of
things.
They don't want you to leaveeither.
They'd rather pay you less andhave you be happy and work hard
for them, but they don't wantyou to leave.
And so it really makes sense toturn any negotiation like this
into a win-win where it's goingto be a fruitful, profitable,
(32:03):
happy, long-term relationship.
And so that's what you'reworking with in a physician
contract negotiation situation.
And I think it's important torealize that up front, that it's
to the employer's benefit aswell for the physician to be
happy.
It's not going to do you anygood to have a bunch of docs
that are not happy with you.
It's going to create far moreproblems than it's going to save
(32:25):
you money.
SPEAKER_03 (32:25):
Yeah, I couldn't agree more.
Everybody wants that win-win.
Everybody wants to be happy.
They don't want to go find theirnew doctor.
Dennis, that brings me tosomething that I know you see a
lot of somebody just gets acontract and they want to sign
on the dotted line as soon aspossible, especially residents
and fellows coming out oftraining because they have a job
offer.
They've done all this work andnow they have to sign and the
(32:49):
recruiter might have said, Ican't negotiate.
This is their standard contract.
and I can't change it.
What do you say to thosephysicians?
SPEAKER_00 (32:58):
The recruiter's probably telling the truth.
The recruiter probably can'tchange it.
What the recruiter didn'tmention is for it to get
changed, I'd have to send it tolegal.
So, you know, probably not lyingwhen I say this is the contract
and I can't change it, but thatworks.
And anecdotally, I'm guessing40% of all physicians just sign
what's handed to them.
(33:18):
Again, I've never seen a survey,but that's my sense that, well,
they said it was a standardcontract.
And I talked to one of thepeople, you know, in my
graduating class and they weregetting paid the same I was.
So, you know, I thinkeverything's fine.
But that's probably the biggestissue that I see is not, again,
(33:39):
the recruiter's not lying, butit may not be the whole story.
SPEAKER_03 (33:43):
Yeah.
Yeah.
You
SPEAKER_01 (33:48):
know, there's usually some place where the
contract can be improved.
Maybe they can't pay you moresalary, but maybe you can have
some more time off.
Right.
Or maybe you can have, you know,a larger continuing medical
education allowance or, youknow, maybe you can have some
more assistance.
in your clinic, making your lifedramatically better because you
(34:08):
have an extra medical assistant.
Things like that can often beadded to a contract, even when
for some reason you'renegotiating partner slash
opponent has their hands tiedwith one aspect of the contract.
Often they don't have theirhands tied with many other areas
of the contract.
So I think absolutely the mythof the standard contract really
is out there.
And the truth is most contractscan be changed in a lot of ways,
(34:32):
maybe not every way, but in alot of ways they can.
For example, let me tell youabout a contract I signed 15
years ago.
My physician partnershipcontract had a non-compete in
it.
And I'm an emergency doctor,right?
A non-compete is like thedumbest thing ever for a
hospital-based physician likeme.
Nobody is coming to the hospitalbecause they want to see me
(34:54):
individually.
When I leave the hospital, I'mnot taking any business away
from the hospital.
I'm not taking any patients withme whatsoever.
And so I brought this up duringthe negotiation process.
And I'm like, what exactly areyou guys worried about?
Well, it turned out what theywere worried about was me
stealing the contract from thehospital and bringing in a new
group of emergency physicians tostaff that contract.
(35:17):
So we rewrote the non-competeagreement to say that I couldn't
do that.
Not that I couldn't work in thecity should we decide to part
ways.
And everybody was happy.
It's amazing, though, that nophysician...
Prior to me in this partnership,dozens and dozens of physicians
had ever balked at thatnon-compete agreement in the
(35:39):
past.
And so it kind of became the newstandard way that it was
written, was the way that Idemanded it to be written when I
was hired.
So just realize that you havemore power than you think.
Remember, as you're signingthese contracts, it is costing
them a lot of money to get youor somebody like you in the
door.
And so it's not insignificant,the power you have in the
(36:01):
negotiation.
I
SPEAKER_03 (36:03):
love that you just asked the question, like, what
are you worried about?
Because I think sometimes itcomes down to communication or a
lack thereof of like, what isthe concern here?
Because my concern is that Ineed to go work at a hospital
and I don't want to have tochange schools for my kids.
But what are you concernedabout?
And actually getting to thebottom of it is an incredible
concern.
(36:23):
that most physicians just don'task for.
SPEAKER_01 (36:27):
Another great question is, is that the best
you can do?
I'm amazed how much better thedeal comes back without anything
other than, is that the best youcan do?
SPEAKER_03 (36:36):
Definitely step one that I would say.
Is that your best?
Dennis, when you go into acontract negotiation, are you
just asking for one thing?
SPEAKER_00 (36:50):
No, my letter covers everything.
I mean, every...
every clause that could bebetter or more balanced or more
favorable to the physician Iasked for it.
I don't expect, you know,probably in my career, I've had
about three times where theygave us everything we asked for,
but they'll give you some andanything they give you makes it
(37:10):
better.
And I tell physicians, if youwant to negotiate, it's a lot
easier to negotiate with aletter that has 35 bullet points
and say, okay, I'll give youthat.
I'll give you that.
I'll give you that.
Okay.
No, this one, no.
No, we have to talk about thisone.
You know, it just makes yourposture a lot better than what I
always caution my clients not todo is read my letter, decide
(37:32):
what's important to them, andthen go to the employer with
those.
Because if you think about it,if we're negotiating and I come
to you and say, Sarah, there'sfour things that's really
important to me.
Well, if you give me two ofthem, you're going to say,
Dennis, I met you halfway.
you know, now you lookunreasonable.
Whereas if there were 35 and Istand firm on four, you know, it
just changes, I think, the easeof the negotiation.
SPEAKER_03 (37:56):
Yeah, it definitely takes out that confrontational
element when, well, these are mysolid.
We can let the other stuff go,but these four have to slide
through.
This is so awesome.
So final thoughts when it comesto physician contracts.
Dennis, what is one thing thatyou or your final thought on
just the topic in general?
SPEAKER_00 (38:16):
There's no standard contract generally.
Even if the language isstandard, as Jim pointed out, a
lot of times they can do otherthings for you to make your life
better.
So I think the first thing tome, the number one thing is
don't accept the standardcontract line.
SPEAKER_03 (38:32):
And Jim, I can almost already hear what you're
going to say, but can we haveyour final thoughts when it
comes to physician contract, howa physician or how they should
approach it or what they shoulddo?
SPEAKER_01 (38:45):
Yeah, first for the physicians, get your stupid
contract reviewed.
That part's pretty easy.
For the attorneys, if you'regoing to do this, do this right.
Make this your entire practiceor the majority of your practice
so you really are well-versedwith the ins and outs and the
changes in these contracts overthe years.
Make sure you have access toMGMA and similar data.
(39:07):
You do enough of these, you'llhave your own in-house data of
what a fair contract contractlooks like.
And, uh, and you'd be surprisedyou treat physicians.
Well, they will send all theirfriends to you and you will
have, you know, a wonderfulpractice doing great work.
You treat people poorly and, andit'll be amazing how few clients
(39:28):
you get ever again.
SPEAKER_03 (39:29):
Yeah.
Great lessons, even for life.
Uh, I want to thank you both somuch for your time today.
Thank you to the audience that'slistened and stay tuned.
And, uh, we appreciate you somuch.
Thanks so much guys.
UNKNOWN (39:43):
Thank you.
SPEAKER_02 (39:47):
To subscribe and add this private podcast feed to
(40:13):
your podcast app, go toAmericanHealthLaw.org slash
Daily Podcast.
you
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