Contract Mastery · 9 min read
Reading Your Contract
The clauses that matter most — and what to ask about each one.
The most consequential document you will sign
A physician employment contract has more financial impact than a mortgage. It controls income, exit terms, geographic restrictions, malpractice tail liability, intellectual property, and the conditions under which you can be terminated. Knowing what each clause means — before the deadline pressure — is the preparation most physicians wish they had done.
Six clauses to find — and read carefully
Tap each. These are the clauses that change physician lives most often.
Non-compete clause
Restricts where you can practice after leaving. Common: 10-25 mile radius, 1-2 year duration. Enforceability varies wildly by state. Some states ban physician non-competes entirely. Negotiate radius down and duration down.
Termination without cause
The clause that lets the employer end the relationship without a specific reason. Notice period is the key variable — 60 days is short, 180 days is generous. Match it to the time you would need to find a comparable position.
Tail coverage
Malpractice insurance covering claims filed after you leave for incidents during employment. Claims-made policies require tail; occurrence policies do not. Tail can cost $20,000-100,000+. Negotiate "employer pays tail" — saves enormous money on exit.
RVU threshold
The wRVU level below which you earn only base salary and above which you earn productivity bonus. Compare it to your specialty median and to what the prior physician produced. A threshold above the 75th percentile is a red flag.
Patient restrictive covenants
Even where non-competes are not enforceable, patient-solicitation clauses often are. They can prevent you from contacting your own patients. Read this clause in tandem with the non-compete.
Intellectual property
Most contracts assign all inventions, patents, and works created during employment to the employer — sometimes including off-hours work. If you do any creative or inventive work outside clinical practice, this clause matters.
Non-compete enforceability
This step is a quick self-check. Open the full module to try it with your numbers →
Tail coverage negotiation
This step is an interactive scenario. Open the full module to try it with your numbers →
Compensation models
Tap each. Knowing which model you are signing into changes how you think about everything else.
Straight salary
Fixed base, no productivity component. Predictable income. Less upside but no downside. Common for academics, hospital-employed primary care, and first-year guarantees.
Pure productivity (wRVU)
Pay tied entirely to work produced. High variability. High upside for high producers. Common in procedural specialties. The conversion rate per wRVU is the critical number.
Hybrid (base + productivity)
Base salary up to a wRVU threshold, then bonus per wRVU above. Most common model for employed attendings. Threshold placement determines whether the bonus is achievable.
Quality bonus
Additional 5-15 percent based on metrics like patient satisfaction, quality scores, compliance documentation. Achievable but adds reporting overhead. Read what metrics, what targets, and who calculates them.
The review checklist
- Have a healthcare-specific employment attorney review every contract before signing. Cost: $500-1,500. Value: enormous.
- Tail coverage is one of the most negotiable items in any contract. Always ask.
- Non-compete enforceability is state-specific. Do not assume the radius is binding without state-specific legal review.
- The compensation model determines what every other clause means. Read it first.
Do this next: Before signing, list the six clause types above and write down what your contract says about each one. Bring that list to an employment attorney. If you use the Contract Reading Guide on this platform, it will flag those clauses and benchmark the compensation against MGMA data for your specialty.
Run this with your own numbers
The interactive version of this lesson works through your actual paycheck, loans, and benchmarks — and your AI advisor can take it from there. Free to start, no card required.