From a close eye on financial value to knowing career goals, here's what five physicians across four specialties told Becker's ASC Review were the factors other physicians should think about when deciding if contracting with hospitals is right for them.
Note: Responses were lightly edited for style and clarity.
Question: What are key considerations physicians should know when thinking about entering contracts with hospitals?
John Woodward Jr., MD. Orthopedic surgeon at Swedish Medical Center (Englewood, Colo.): My piece of advice in contracting with a hospital is to have the contract reviewed by a healthcare attorney as there may be language that requires you to understand exactly what is stated in the contract. Also, note the date of onset and termination of hospital contracts as they can come up quickly and need to be updated before the contract expires. Finally, when contracts are being edited, always ask for the “redline” version of the contract that shows all the changes from the prior contract. I have seen changes in dates, numbers and addendums that were not discussed.
Todd Chassee, MD. Emergency medicine specialist at Spectrum Health System (Grand Rapids, Mich.): Value continues to be the “buzzword” in contract negotiations, but figuring out how to operationalize value in contracting between independent physician groups and health care delivery systems remains a challenge. Both parties agree that value is the goal, but figuring out tangible items for contracts is difficult.
Vivek Kaul, MD. Gastroenterologist at University of Rochester (N.Y.) Medical Center & Strong Memorial Hospital (Rochester): The most important principles to keep in mind when evaluating a contractual relationship with a hospital are as follows:
1. Seek and provide transparency throughout the process.
2. Aim for a “win-win” negotiation when discussing terms of a contract/employment.
3. What role will you play in the system or at the hospital and does the system provide resources for you to be successful in that role?
4. Is the compensation package fair and what benefits are included beyond salary and incentive?
5. Understand the nature and scope of any “non-compete” clauses (and/or any other restrictive covenants) as well as the penalties involved if such an agreement is breached.
6. Have a clearly defined exit strategy in place, should things not work out.
7. Be prepared to walk away if there are fundamental disagreements on overarching goals, vision and philosophy.
Ricardo Borrego, MD. President of Anesthesia Surgical Associates (Dearborn, Mich.): Quite simply said, there are three key items to genuinely consider when entering into any contract, especially a hospital one.
First, the most obvious is salary considerations along with any bonus structure based on your productivity. Second, understand if there are lifestyle changes which you expect or are clearly understood beforehand. Finally, have whatever career advancements available for the future clearly defined.
Ponder these items before jumping into the perceived security of a hospital-based contract, which may leave expectations undefined once you've signed.
Michael Bolognesi, MD. Orthopedic surgeon at Duke University Medical Center (Durham, N.C.): There are obviously a lot of physicians contracting with hospital systems in the current healthcare climate.
There are many issues that seem to be common considerations. I think it is critical to make sure there is transparency around how compensation is negotiated. There are a lot of different formulas and sources for benchmarking but there has to be agreement on both sides about how this gets calculated. Many physicians are also concerned about the duration of the agreement. They want to be sure that they are not getting into a position where compensation drops significantly after two to three years.
I think it would also be smart on the physician side to make sure there are options for reinvestment of shared savings to the service line, rewards for quality metrics and rewards for academic metrics if it is possible in that setting and gain sharing where possible and appropriate to allow for a unified approach to care delivery.