Physician Employment Contracts: 12 Clauses to Check Before You Sign

By Clay Wyant, Attorney.

Published: September 21, 2026

Before signing a physician employment contract, pin down what the offer actually commits you to: the work and schedule, the pay and what makes it conditional, the insurance, and the obligations that outlast the job. The agreement, its exhibits, and the policies it references control those answers together, so read them as one set.

An offer can arrive as several related documents: an employment agreement, a compensation exhibit, sometimes a separate promissory note for a signing bonus, and policies the agreement incorporates by reference, meaning it makes them part of the obligations by referring to them. Terms that affect the same event can sit in different documents. A trigger in one can activate an obligation in another, so compare them against each other before you sign.

Here are the twelve areas to locate, what each controls, and the wording to clarify before signing. Each row links to the full discussion below.

What work are you actually committing to?

1. Duties and work locations

The job you discussed and the job the contract describes can differ, and the location language is usually where they part ways. A clause covering "Employer's facilities, now or hereafter owned, operated, or affiliated" can permit assignment to a site that did not exist when you signed, subject to its actual wording. If the recruiting conversation was about one clinic, ask for that clinic to be named in the agreement, and ask what limits reassignment: a mileage radius, advance notice, or your consent.

Also read the duties language for supervision obligations and for anything described during recruiting that the document does not mention. What appears in the signed agreement is what you can point to later.

2. Schedule, call, and administrative time

"Equitable share of call" isn't a number, and the share moves when staffing moves. If 30 nights of call are divided equally among five physicians, each covers six. Divide the same 30 among three, and each covers ten. Ask how the agreement handles vacancies and additional call.

Administrative time deserves the same specificity. If protected time for charting, results review, or a medical directorship was discussed, ask for an hours figure in the agreement, and ask whether administrative and clinical hours are counted separately. A number in the document gives you a term to point to. A recruiting conversation does not appear in the signed agreement.

How much of the money is guaranteed, and what is conditional?

3. Base salary and guarantees

If the offer includes an initial guarantee, find its end date before anything else in the compensation exhibit, then find what the pay becomes afterward. Offers vary: some continue a salary, some move to productivity-based pay, some blend the two. Define the formula actually in front of you instead of assuming a structure.

One structure needs particular attention. If the base is described as a draw or an advance, the employer is treating it as prepayment against compensation you have not yet earned. The label alone tells you nothing about the consequences. Ask three questions: what formula defines earned compensation, when advances are compared with earned compensation, a process called reconciliation, and what happens to any shortfall, both during employment and if you leave mid-period. A draw with an undefined reconciliation formula is a blank the employer fills in later.

4. RVU and productivity compensation

Productivity pay can be based on relative value units. A relative value unit (RVU) is the measure the Medicare Physician Fee Schedule uses to express the relative resources a service requires, with three components: work, practice expense, and malpractice expense (Centers for Medicare & Medicaid Services). The work component is called a work relative value unit (wRVU). It measures the physician work that goes into a service, not the number of patients seen or dollars collected. Check which measure your compensation formula uses.

These definitions describe a salary-plus-bonus arrangement, the structure used in the example below; identify your offer's actual formula before applying them. In that structure, the contract should define five things. The threshold, meaning the production level you must clear before bonus pay begins. The conversion factor, meaning the dollar amount paid per wRVU above it; this is the employer's own contract number, and it is not the Medicare payment conversion factor. The measurement period. How production is attributed to you. And the reporting you will receive to check the calculation, because a formula you can't audit is a formula you have to trust. If your offer instead bases compensation entirely on wRVUs, ask which services earn credit, what rate applies, and when payment is calculated. If it also includes a draw, ask how the advance is compared with earned compensation and what happens to any difference.

Attribution is worth a direct question. Billing records and compensation credit are not necessarily the same numbers, and federal self-referral rules can constrain how an employed physician's productivity pay is structured (42 CFR 411.357(c)), so credit for care involving an advanced practice provider, such as a nurse practitioner or physician assistant working under your supervision, varies by arrangement. Ask how supervised encounters are attributed and get the answer in writing. Do not assume a particular credit arrangement when comparing offers.

A hypothetical comparison: same salary, different math. Assume two offers, each paying a guaranteed $280,000 base in year two on top of which a bonus can be earned, and assume the physician produces 5,400 wRVUs that year, measured over the full year. All figures are illustrative, not market benchmarks.

Offer A sets the bonus threshold at 4,800 wRVUs and pays $48 for each wRVU above it. The 600 wRVUs above the threshold produce a $28,800 bonus, for $308,800 in total.

Offer B sets the threshold at 6,200 wRVUs and pays $52 above it. The same 5,400 wRVUs sit below the threshold. No bonus. Total: $280,000.

Identical base, identical production, a $28,800 difference. The higher rate in Offer B is worth less than the lower threshold in Offer A at this production level. Compare the threshold and the rate together at a production level you consider realistic, never the rate alone.

If the formula includes a threshold, ask whether it is prorated, meaning adjusted in proportion to the part of the year you work, for a partial first year. Also ask how leave, including parental or medical leave, affects the measurement period and any threshold.

5. Signing bonuses and relocation repayment

Start with what the payment actually is, because the structure controls both the tax timing and what repayment means. A bonus paid as wages is generally taxable when you receive it. A genuine forgivable loan, documented as a loan with a repayment obligation, is generally recognized as income as portions are forgiven, not when the money arrives (The Tax Adviser). The label on the document does not settle which one you have, and the repayment obligation and the tax treatment are separate questions that rarely line up neatly in timing. Ask what amount must be repaid on early departure and how payroll will handle a repayment. The signing bonus repayment article covers the mechanics, including clawbacks and forgiveness schedules.

Then find the trigger. Here is a hypothetical version of the sentence that decides it: "If Employee's employment terminates for any reason prior to full forgiveness, the outstanding balance shall become immediately due and payable." For any reason. As written, that includes a termination you did not choose. Two requests worth raising: a carve-out when the employer terminates without cause, and proration by month instead of by year. These are requests, not standard concessions, and the response tells you something either way.

6. Benefits, paid time off, and continuing medical education

Benefits usually live partly in the agreement and partly in plan documents and policies the agreement references, and the split matters more than the headline numbers. Plans governed by their own documents can change on their own schedule, which is ordinary, not a red flag by itself. The point is to know which promises are contractual and which are policies before you rely on them.

Ask for the handbook and the benefit summaries, then check the details that actually bite: when benefits eligibility begins, and whether the waiting period leaves a coverage gap after residency coverage ends; how paid time off (PTO) accrues, who approves it, and whether unused time carries over or is forfeited; whether continuing medical education (CME) support is time, money, or both, and what conditions attach to reimbursement; and the retirement plan's vesting schedule, since employer contributions you leave behind are part of the real cost of an early exit.

Who covers a malpractice claim after you leave?

7. Malpractice insurance and tail coverage

Find the policy type first. An occurrence policy covers care delivered during the policy period regardless of when the claim is filed. A claims-made policy is triggered by when a claim is first made, and most forms also require it to be reported while coverage is in effect, though reporting rules vary by policy form (American Bar Association). Check the retroactive date, the earliest date of care the policy covers, and the reporting requirements, because either can leave care you delivered without protection later. The usual way to extend protection after coverage ends is an extended reporting endorsement, known as tail coverage. It is not always the only route: continuing coverage, or prior-acts coverage accepted by a future employer's insurer, can address the same exposure.

The contract questions are direct. What type of policy applies. Who is responsible for tail coverage or equivalent protection when employment ends. And does that responsibility change depending on who ends the relationship and why. If the agreement is silent on the tail, resolve the silence before signing instead of discovering the answer on the way out. The tail coverage article explains the allocation options and the language to request.

When does the job start, and how can it end?

8. Term, renewal, and start conditions

The start date often depends on licensure, credentialing, and payer enrollment, and none of those are fully in your control. Separate two things the contract may blur: when you can start working, and when you start being paid. Ask whether salary begins if credentialing delays clinical work, whether there is an outside date after which either side can walk away, and what happens to any money already advanced if employment never begins. The documents control each of those answers.

A brief illustration for a first contract out of training: a resident finishing June 30 signs an agreement with employment beginning "upon completion of credentialing." If the credentialing committee meets quarterly, the start could land months later, with no pay in between unless the agreement says otherwise. The same reader should ask how a partial first year interacts with any productivity threshold. This example is hypothetical; the point is that each of these is a question the documents either answer or leave open.

Term and renewal are simpler. Find the initial term, whether it renews automatically, and the deadline for nonrenewal notice, which is worth putting on a calendar. Automatic renewal is ordinary. Note that renewal and termination are separate provisions: a renewed term usually remains subject to whatever without-cause termination rights the agreement contains, so read the two together before assuming a renewal binds anyone for a full additional year.

9. Termination and notice

Physician employment agreements commonly allow either side to end the relationship without cause on advance notice. In guidance published by the American Medical Association, its senior attorney Wes Cleveland recommends looking for a notice period of no less than 90 days. That is an expert recommendation, not a legal requirement; your agreement supplies the actual number. Weigh the trade-off in both directions: a longer employer notice period gives you more warning and more runway, while a longer notice obligation on your side binds you longer when you want to move. If the periods differ by side, understand why before deciding whether to raise it. And ask one question that often goes unasked: if the employer takes you off the schedule during the notice period, does pay continue?

For-cause termination deserves a slower read. The grounds often include events like loss of licensure, exclusion from federal health care programs, felony conviction, or loss of clinical privileges. Understand exactly what each ground covers: which license, whether a temporary restriction counts the same as a final revocation, and whether the event actually prevents you from doing the job. The American Academy of Family Physicians includes clearer for-cause termination provisions among the items physicians should consider requesting in negotiations. For breaches that can be corrected, ask whether the agreement provides written notice and a cure period, meaning a defined window to fix the problem before termination takes effect. Some events may justify immediate termination; the useful clarification is which ones, in writing.

Why these provisions have to be read as one set. Assume a $60,000 signing bonus documented as a loan forgiven at $20,000 per completed year, a promissory note that triggers repayment on termination for any reason, a claims-made policy that assigns tail coverage to the physician on termination for any reason, and an employer that terminates without cause at month 20. One anniversary has passed, so $40,000 remains outstanding, and both "for any reason" triggers fire even though the physician did not choose to leave. Illustrative figures, ignoring interest. Each of those triggers is a separate item to raise before signing, and none of them is visible from the termination clause alone.

What follows you after you leave?

10. Non-compete and non-solicitation

Read the non-compete for four variables: the activity it restricts, the geography, the duration, and the trigger. Geography is where the practical damage usually hides. A radius measured from every facility in a large system can cover far more ground than the same radius measured from your own practice site. Assess how the restriction could affect your next practice location, not just your current commute.

The trigger is the most negotiable-looking variable on the list, and the guidance published by physician organizations supports raising it. The American Academy of Family Physicians' negotiation list includes limiting non-compete enforcement to only certain reasons for termination, excluding reasons outside your control, and the American Medical Association's published guidance makes the parallel point that restrictive covenants shouldn't apply when the employer ends the relationship without cause.

Whether the clause is enforceable is a separate question from what it says, and it turns on state law. The Federal Trade Commission's 2024 rule that would have banned most non-competes never took effect and was removed from the Code of Federal Regulations effective February 12, 2026 (Federal Register). Several states restrict physician non-competes specifically; others enforce reasonable ones. Read the clause as if it will be enforced, and get a state-specific answer before you rely on the assumption that it won't be.

Non-solicitation is the quieter provision next to it. It typically restricts recruiting former colleagues and soliciting patients, and the patient side intersects with continuity of care. Ask how patient notification is handled when a physician departs. What you may take or copy involves privacy and professional obligations that need their own analysis, so do not assume the answer either way.

11. Confidentiality and non-disparagement

These are two different obligations that often share a section. Confidentiality protecting business information is ordinary and expected; the questions are what counts as confidential, for how long, and which disclosures remain permitted. Non-disparagement is a separate promise about what you say, and it is worth checking whether it binds both sides or only you.

The clarification worth insisting on: express wording that preserves reports to licensing boards, accreditation bodies, and government agencies. Statutory protections for some reports exist independently of the contract, but clear wording helps prevent disputes about what the contract permits.

Which documents and terms control everything else?

12. Incorporated policies, amendments, assignment, and disputes

Look for a sentence like this hypothetical: "Employee shall comply with all Employer policies, procedures, and handbooks, as amended from time to time." The closing phrase reserves the employer's right to change the referenced documents later. What that means for you depends on answers the clause itself rarely gives: which documents are incorporated, which version applies, what the employer can change unilaterally, and which document controls if a policy conflicts with a signed compensation or scheduling term. Ask to review the referenced documents before you sign, and ask where the compensation and scheduling details actually live, because a signed-amendments-only clause in the agreement can coexist with changeable exhibits and plans.

Two provisions in this family get skipped on the way to the salary page. Assignment addresses whether and on what conditions the agreement can be transferred to someone else. If you chose this practice specifically, read the assignment language together with any change-of-control provision, because an acquisition can be structured so ownership changes hands without the contract ever being assigned. The dispute provision says where a disagreement goes: arbitration or court, under which state's law, and who pays fees. Those terms can materially affect what the rest of the contract is worth. Understand them before signing, not after a dispute makes them relevant.

What to ask before you sign

Ask questions that produce documents and definitions, not reassurance. Four that consistently earn their place:

1. Please send the employee handbook, the benefit summaries, and every exhibit or policy the agreement references. I'd like to review what I am agreeing to follow.
2. How are encounters involving a supervised advanced practice provider attributed for productivity purposes, and what production reporting will I receive?
3. If the practice terminates my employment without cause, does the signing bonus repayment still apply, and who is responsible for tail coverage?
4. Is the non-compete radius measured from my practice site, or from every location in the system?

Then sort what you find into three piles, because each needs a different response. Missing information, such as a referenced handbook you have not seen: request the document. Unclear wording, such as an undefined termination ground or an unexplained formula: ask what it means, and get the answer reflected in the agreement. A term you understand and want changed: decide what to request, and how you will weigh the term in your decision if the employer declines. When an employer calls a provision standard, remember what that word describes: the employer's template. It does not answer what the clause means for you.

Common questions

Can I negotiate a physician employment contract, or is the offer final?
Usually you can ask. Requests tied to something specific you identified, an undefined term, a missing document, a trigger that reaches further than what was discussed, are easier to raise and easier for the employer to answer than a general request for better terms. Which terms move depends on the employer and the offer.

Is a signing bonus taxable if I have to pay it back?
That depends on how the payment is structured. A bonus paid as wages is generally taxed when received, while a genuine forgivable loan is generally recognized as income as it is forgiven. Repayment and tax treatment are separate questions with timing that rarely lines up, so ask what amount must be repaid and how payroll will handle it. The signing bonus repayment article works through the scenarios.

Does my employer have to pay for tail coverage?
No general rule assigns the cost either way; the contract controls. If the agreement is silent, resolve the question before signing. One compromise to consider requesting is employer-paid tail when the employer ends the relationship without cause.

Are physician non-competes still enforceable?
Sometimes, depending on your state. The federal rule that would have banned most non-competes never took effect and has been removed from the Code of Federal Regulations, so enforceability is a question of state law, and several states have physician-specific limits. Read the clause as if it will be enforced, and get a state-specific answer before you rely on the assumption that it won't be.

What if the recruiter promised something that is not in the contract?
Ask for it to be added, in writing, before you sign. A written agreement generally controls over earlier conversations, particularly when it states that it is the entire agreement between the parties. If the employer will make the promise but won't write it down, that's information worth having before you sign, not after.

How long should I ask for to review the contract?
A few days is a reasonable request. Make it in writing with a specific date, so the timeline is defined on both sides.

Before you sign

Read the compensation exhibit, any bonus paperwork, and the insurance section against the termination provisions, and sort every open item into the three piles above: missing documents, unclear wording, and terms you want changed. That sorting is what turns a long contract into a short list of questions.

If unresolved questions remain, Wyant Legal reviews physician employment agreements for a flat fee: $795 with a written report in three business days, or $945 with a report in one business day. The review is a plain-English written report organized by contract section, with written negotiation points you can use with your employer and email follow-up for questions. It is written work delivered to you; the firm does not contact your employer or negotiate on your behalf. Request a contract review.