by Katherine Vessenes, JD, CFP® and RFC
Contracts can be negotiable and many can be improved upon in some way. If you sign without negotiating you could be leaving benefits (money, vacation time, etc.) on the table.
Know what you are worth! You have to do your homework:
Be aware that salaries are typically lower on the coasts than in the center of the country.
Medicine is being treated more like a business so contracts often include the right to reduce your salary when tied to your productivity, referral base, network area, etc.
Ask employer about their marketing plan for patient recruitment. This way you’ll know from the beginning if you’ll have to do your own marketing.
Know how your salary is calculated - Realize that your salary may not be fixed and guaranteed.
Ask “What are doctors in my position making in year 2, 5, etc. of the contract?” You could always ask for a range.
Benefits: When salary and working conditions are similar, benefits, particularly pension plans, can vary wildly from employer to employer and may be the deciding factor in your job choice.
401Ks and 403Bs, both defined contribution plans, are the most common employer sponsored pension plans. The big issue is to ask about the “match.”
On the low end, the match might be 2% per year with a five-year vesting schedule.
The highest we have seen is 12% per year.
Vacation Time: This has been decreasing in the last few years. However, a minimum of four weeks for physicians is the norm. We have seen up to 12 weeks/year in some specialties.
Relocation expenses: Typically range from no relocation expenses to unlimited amounts, depending on how heavily the physician is desired.
Covenants not to Compete: These are quite common in contracts as loyal patients will tend to follow their doctors to a new employer when geography allows for such. This can be an important issue to resolve up front, since many of our clients find their first job is not to their satisfaction and end up leaving.
Practice tip: This is an area where you should get advice from an attorney. If possible, see if your future employer will eliminate this clause from your contract. If that is not possible, try to get the time limit to less than a year, and maybe 5 miles from your existing location.