PA Contracts Overview
Contracts play a critical role for any medical provider, and physician assistants are certainly no exception to the rule. Contracts help to set professional terms, whether that be contracts for employment, those made with insurance carriers , or other contractual agreements. These contracts lay out clear terms for all parties involved. They are important from a legal perspective in protecting the professional and the practice they are employed with. Contracts also operate commercially, as they ensure that practices can bring in top talent and physicians can obtain high quality support. Consequently, it is crucial for physician assistants to ensure that they understand how to navigate this space.
Key Components of a Physician Assistant Contract
As is the case with most employment agreements, a PA contract should address the essential issues in order to avoid future disputes. Key elements that should be included in a physician assistant contract include scope of services, compensation and bonuses, benefits, work schedule, on-call requirements and termination. Additionally, a PA contract might also cover the following:
Inclusion of these items is subject to each individual situation or practice requirements, and one contract is not appropriate for all PAs. Furthermore, if state regulations allow PAs to function independently, the language regarding supervision and oversight may be unnecessary. Finally, a physician assistant contract for an independent contractor will differ significantly from that of an employee, as the former has more flexibility in structuring their work.
PA Compensation and Benefits
Compensation and Benefits:
The first thing we are going to do in this blog post is review the most common compensation structures for Physician Assistants.
We have found through our experience that the typical compensation structures for Physician Assistants include, but are not limited to: Salary, salary plus bonus, salary plus productivity, hourly, hourly plus bonus, hourly plus productivity, along with various combinations thereof. We will examine each one now.
Salary Structures:
Salary: This is typically the standard method of compensation for Physician Assistants. It is the easiest structure administratively and also protects the PA from potential issues of overworking. The structure allows for a fixed payment unless extra hours and duties are requested.
Salary plus Bonus: This structure is typically salary plus a productivity tier. This structure discusses productivity and use of RVUs and the physician’s and/or entire office’s annual income. This structure can be difficult to administer, loss of records, occasional disputes between staff members (doctors, nurse practitioners etc) regarding such records. However it sets out a definitive and clear amount based on performance. It is also important to stress that a physician only’s productivity is not always enough. As such it is best to utilize a percentage of the total clinic’s profitability. This is the fairest structure.
Hourly: This structure is not very common as many PAs do not want to be treated like an employee who is on the time clock and doesn’t leave until the clock stops ticking. However if the practice and the PA feel comfortable in such an arrangement it is okay and compliant with federal law.
Hourly plus Bonus: Again, it can be difficult to administer and we have found it is best suited for a physician who utilizes registry or temporary physicians assistants. It can be difficult to gauge how many clinic patients the PA sees in a given day, week or year, which is necessary to distribute the "bonus".
Hourly plus Productivity: This would be very similar to the productivity option above, with the difference being that the PA would be compensated based upon the number of hours he/she works vs. the productivity. It is very important that hourly rates be not necessarily on top of the salary but rather the salary or hourly rates should account for all duties performed, including direct patient care such as examination, diagnosis, basic tests and consultations or referrals. It is very important that the Contract include any and all compensation such as automobile reimbursement, housing and CME reimbursements as well as other fringe benefits. For example, if the physician assistant is entitled to health insurance, disability and retirement plans at a later date, this should also be clearly set forth in the Contract.
An Overview of Scheduling and Call
The physician assistant contract should clearly set out the expectations of the employer with regard to the PA’s hours. Obligate the physician assistant to work a certain number of hours per week and state the times when the PA is expected to be in the office seeing patients. Does the physician assistant have a lunch break? If that is mandated, does the PA have to stay on the premises? Does the PA have to stay at the office until patient care is completed even if that means missing lunch? If there is no break scheduled for lunch, can the PA eat lunch while seeing patients (which, of course, is an impossibility)? Physician assistants who do this type of multitasking almost always end up with Repetitive Strain Injury.
For call duties, the contract should specify not only what the call duties are, but also whether or not the PA is expected to be on site during those call periods. While some employers may want a PA on site, others may expect the PA to be on site only for certain calls. Keep in mind that any time the PA is required to be "on call" the contract should include call compensation terms. Reportedly, many PA’s feel that they are "never off duty," which is no way to live and practice medicine. Obtaining agreement on exactly when the PA is not working benefits the employer. It allows the employer to know with some certainty as to when the PA will be available for patient care and when the PA will not be available. Failure to define work periods will only serve to harm both parties.
Termination and Non-Competition Clauses
For many physician assistants, the non-compete clause or termination clause in their contracts will govern how they move forward following their separation from their current employer. A non-compete clause generally restricts the actions of a physician assistant and prohibits them from providing medical services to patients within their specialty in a certain area. A termination clause will typically dictate how much notice an employee is required to give to end their employment relationship, and what conditions may automatically terminate that relationship. There are many variations of these types of clauses, but the most important aspect to consider is the language used in the contract.
While courts generally uphold these types of provisions, there are multiple factors that are taken into account when determining whether a termination clause or non-compete clause is enforceable, including the duration that the clause applies over, and geographic region that it covers . This means that with a little diligence, it may be possible for a physician assistant and their attorney to negotiate a provision that is not overly restricting, while still being legally binding.
In addition to termination clauses and non-compete agreements, there may be non-solicitation clauses in some physician assistant contracts that specify the physician assistant is not allowed to solicit staff members of the practice who are considered integral to its value for a certain period of time. In some cases, if there is already a non-compete or a similar restriction present in the contract, the restriction against solicitation may not hold any value. You can understand that this can create a real dilemma for physician assistants.
How to Negotiate a Physician Assistant Contract
Negotiating your contract is often the most uncomfortable phase of the process. However, it really should not be… In all actuality, if you are prepared, know what you are doing, and have a solid written and binding employment agreement, it should be fairly straightforward. When it comes to negotiating your compensation package, there are really two key components that should drive the negotiations – 1.) Realistic expectations of your compensation based on the specialty/city you are working in, years of experience, etc.; and 2.) the needs of your employer. The successful negotiation of your PA contract will almost always require that you become familiar with both of these concepts. Getting acquainted with the market place is simple enough – research your specialty/city, learn what mid-level providers are getting paid, what types of benefits are being offered, etc. The key here is not to aim too high or too low in order to get the job – it is to know that the offer you are being presented with is reasonable, and therefore negotiable to a degree. If/when you feel too uncomfortable to broach a subject concerning your pay or benefits, don’t be. Remember, if the offer doesn’t sit well with you, keep looking. PA contracts are somewhat like marriage contracts – if it doesn’t feel right when you are coming to an agreement, it won’t feel better when you are stuck living with it for the next three to five years. And when it is time to present a rebuttal (i.e., you don’t like the offer), politely give your employer a reason for your ask. For example, you could say, "Based on my research of physician assistants with 5 years of experience in the (XYZ) specialty, it appears the average salary is between $100K-$110K. I am currently at $105k, so if you would consider something between $102K and $107K I would be more than happy to discuss this further." The biggest mistakes I see made in this process are the following: 1.) Taking it personally; even if the employer is clearly trying to low ball you. Just smile and keep it business. 2.) Not providing the employer a number. They are attempting to present you with the best offer possible, but they aren’t going to go out on a limb (especially if you are new to the area). When you do not present a number, it causes the employer pause as to if you really want the job, and gives them an opportunity to assume you are not a good fit. 3.) Not reviewing the agreements they send you thoroughly. You should make sure you understand what everything means before moving forward in the process or countering the offer. 4.) Demanding changes. You should only ever "demand" changes when you are a highly sought after provider. Even then it is better to be polite and say things like, "I’m sorry, but this provision is too broad for me, so could we please clarify X, Y and Z before finalizing our agreement?" Rather than, "I don’t like the way this clause reads – change it." And never say, "Change your contract to read this under penalty of death." 5.) Not working with an attorney. Even though everything seems simple at first, this is most definitely one of those times when you get what you pay for. If you use an attorney who lacks PA contract expertise -or the benefit of having a database of what the market is currently paying, you will pay for it in the end. If you focus on learning about the job market and the process of negotiating a contract you will walk away from the process, whether with a new agreement or a new idea on what you want in your next assignment, feeling like you came out on top.
Legal Considerations and When To Get Help
As with any process, there are legal considerations to keep in mind when preparing the contract. For example, what are the rules which will be considered in determining whether you were actually employed? Remember, you may have been presented as an independent contractor but the Secretary of Labor for this state may not think so. That Secretary, under ERISA and FMLA, and other regulations, may ask you to prove that you were truly an independent contractor, and you must win that argument or else the judgment could be against you when defending the claim. Or, the IRS may simply rule that you are in fact an employee. Then you have all the liability for federal and state employment taxes, social security, etc. The contract must represent the true facts of the relationship, whatever it is, or else a court of law could find you to be either an employee or even an independent contractor. And if the document doesn’t reflect the true nature of the relationship, you can’t go back and get a new contract because you already "agreed" to the old one. Thus, the job of the attorney preparing the contract is to make sure that it reflects the true relationship, which requires some knowledge of the various statutes and regulations which shape the interpretation in the event of litigation.
This is also why (unfair though it may seem) it is important to hire an attorney before signing off on a contract. If you wait until after you have signed a contract it is much more difficult to change the agreement, and in fact, the other side has the right to rely on the contract you have signed as being true and not to be changed. And if there is an important term, it should be reflected in the contract.
It is always smart to look at the contract and ask the question; "Will a judge think that I am telling the truth based on this document?" You can easily cut yourself out of the fair deal by accepting unreasonable terms. And no one can really force you to sign something you don’t want to.
Conclusion: How to Get the Best Physician Assistant Contract
In conclusion, we have covered the most important consideration of Physician Assistant Contracts. When you are looking to walk away with the highest level of compensation as well as the greatest sense of job satisfaction it is important that you consider both the base salary as well as any bonus structure that may be in place. On top of that you should also be sure that the contract you are considering has a reasonable termination clause and that it will be fairly easy for you to negotiate work activities and hours that suit your individual situation . Finally, you’ll want to ensure that there are no non compete or penalizing relocation clauses that could affect your options in the future.
Additionally, you want to keep in mind that a poorly constructed contract can affect the entirety of your career. Since Physician Assistants often move every few years, you don’t want to have any penalties or roadblocks preventing an easy transition into your next position.