CONTRACTING 101: TIPS FOR MEDICAL GRADUATES ENTERING THE WORKFORCE -PART 5

4 Indest-2009-3By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

This is the fifth blog in a series intended to provide an introductory review of the basics of contracting for physicians and other health care professionals, primarily by discussing employment agreements. This blog series will highlight many of the common provisions found in employment contracts, along with many of the mistakes and pitfalls that we see health care professionals make in our day-to-day practice.

By the end of the blog series it is our hope that physicians and other health care professionals will understand the common language and terms found in professional employment contracts so they can recognize mistakes commonly made by physicians and health professionals when negotiating them. We hope to help make both employers and employees more knowledgeable about employment contracts so they can avoid potential problem areas and legal entanglements.

Click here to read the first, second, third and fourth blogs in the series.

Our comments listed here are meant to provide general rules we have learned from our many years of experience. However, please remember, every situation is different and there are exceptions to every rule.

Tip 11 – Carefully Consider Clauses That Allow the Employer to Terminate the Agreement Without Cause on a 30 Day, 60 Day, 90 Day or 180 Day Notice.

Many agreements contain a clause allowing one party or both parties to terminate the agreement “without cause” by giving advance notice of so many days.

With such a clause in your contract, you no longer have a one or two-year agreement. Instead, you have a 30 day, 60 day, 90 day or 180 day contract.

Termination without cause provisions can work for you or against you. Regardless, the term of employment is shortened if there is one. Think about whether or not you can find another job and relocate in 30 days.

Tip 12 – Include a “Cure” Provision If There Is a “For Cause” Termination Provision in The Contract.

This a provision which requires the employer to provide you written notice of any deficiency or breach and allows you a certain period of time (usually anywhere from 10 to 30 days) to cure it.

Tip 13 – In the Contract Specify All Material Terms in a Promise to Make You a “Partner” or “Shareholder.”

A promise to make you a “partner” or “shareholder” in the practice after a certain period of time will not be enforceable unless all of the terms are specified in order for a court to enforce it (price, timing, percentage of ownership, method of payment of the buy-in, etc.). Think of an option to purchase a house. Unless all of the terms for a binding contract are set forth in writing and agreed to by the parties, it will not be enforceable.

Also remember that a promise to “consider” you as a “partner” or “shareholder” in a contract is just as worded. You may be considered and denied this important opportunity.

Future Blogs on Employment Contracting.

In our future blogs, we will continue to provide tips on various issues to watch for in health care employment contracts.

Contact a Health Care Attorney Experienced in Negotiating and Evaluating Physician and Health Professional’s Business Transactions.

At the Health Law Firm we provide legal services for all health care providers and professionals. This includes physicians, nurses, dentists, psychologists, psychiatrists, mental health counselors, durable medical equipment suppliers (DME), medical students and interns, hospitals, ambulatory surgical centers, pain management clinics, nursing homes, and any other health care provider.

The services we provide include reviewing and negotiating contracts, preparing contracts, helping employers and employees enforce contracts, advice on setting aside or voiding contracts, litigation of contracts (in start or federal court), business transactions, professional license defense, opinion letters, representation in investigations, fair hearing defense, representation in peer review and clinical privileges hearings, litigation of restrictive covenant (covenants not to compete), Medicare and Medicaid audits, commercial litigation, and administrative hearings.

To contact The Health Law Firm, please call (407) 331-6620 or (850) 439-1001 and visit our website at www.TheHealthLawFirm.com.

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law. He is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

KeyWords: physician employment agreement, physician employment contract, health professional contracting, negotiating business transactions, physician contracts, contracting tips, contract attorney, business law attorney, business lawyer, contract lawyer, contract litigation, business litigation, contract terms, physician agreements, business transactions, restrictive covenants, noncompetition agreements, covenants not to compete, business ventures

“The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.
Copyright © 2016 The Health Law Firm. All rights reserved.

CONTRACTING 101: TIPS FOR MEDICAL GRADUATES ENTERING THE WORKFORCE -PART 4

4 Indest-2009-3By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

This is the fourth blog in a series intended to provide an introductory review of the basics of contracting for physicians and other health care professionals, primarily by discussing employment agreements. This blog series will highlight many of the common provisions found in employment contracts, along with many of the mistakes and pitfalls that we see health care professionals make in our day-to-day practice.

By the end of the blog series it is our hope that physicians and other health care professionals will understand the common language and terms found in professional employment contracts so they can recognize mistakes commonly made by physicians and health professionals when negotiating them. We hope to help make both employers and employees more knowledgeable about employment contracts so they can avoid potential problem areas and legal entanglements.

Click here to read the first, second and third blogs in the series.

Our comments listed here are meant to provide general rules we have learned from our many years of experience. However, please remember, every situation is different and there are exceptions to every rule.

Tip 9 – Restrictive Covenants (Sometimes Referred To As Covenants Not To Compete) Are Enforceable By Law in Florida.

A covenant not to compete is common in most physician contracts. This clause prevents a departing physician from competing with the employer in a specific geographic area for a specific period of time. These restrictive covenants are, as a general rule, enforceable under Florida law.

There are exceptions and defenses that can be used to defeat or prevent the enforcement of a restrictive covenant, especially in the case of a physician. However, unless you have money set aside to pay for litigation, expect to honor it if it is in the agreement. As an employee, your negotiation strategy should be to have it removed completely or reduce the period of time and reduce the geographic area as much as possible. Also, it should be worded so as to only apply to the office or location in which you actually work and not to the medical subspecialty or type of practice in which you will work.

If you decide you are going to leave a group or practice and you may need to work in violation of a restrictive covenant, it is very important to plan ahead for this. Often strategies can be developed that will avoid litigation.
Tip 10 – Avoid Agreeing to Pay the Premium for Tail Coverage For Professional Liability (Medical Malpractice) Insurance, Especially If The Employer Terminates The Employment.

If you are not able to negotiate this away completely: a) reduce the percentage you agree to pay to fifty percent (50%) or have it reduced to twenty five percent (25%) for each year you are in the practice, and b) insert a provision that if you maintain the same insurance company or obtain retroactive coverage, this will be substituted for tail coverage. If you maintain your insurance with the same company, in reality your “tail” is covered and you should need no additional tail coverage policy.
Future Blogs on Employment Contracting.

In our future blogs, we will continue to provide tips on various issues to watch for in health care employment contracts.
Contact a Health Care Attorney Experienced in Negotiating and Evaluating Physician and Health Professional’s Business Transactions.

At the Health Law Firm we provide legal services for all health care providers and professionals. This includes physicians, nurses, dentists, psychologists, psychiatrists, mental health counselors, durable medical equipment suppliers (DME), medical students and interns, hospitals, ambulatory surgical centers, pain management clinics, nursing homes, and any other health care provider.

The services we provide include reviewing and negotiating contracts, preparing contracts, helping employers and employees enforce contracts, advice on setting aside or voiding contracts, litigation of contracts (in start or federal court), business transactions, professional license defense, opinion letters, representation in investigations, fair hearing defense, representation in peer review and clinical privileges hearings, litigation of restrictive covenant (covenants not to compete), Medicare and Medicaid audits, commercial litigation, and administrative hearings.

To contact The Health Law Firm, please call (407) 331-6620 or (850) 439-1001 and visit our website at www.TheHealthLawFirm.com.
About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law. He is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.
KeyWords: physician employment agreement, physician employment contract, health professional contracting, negotiating business transactions, physician contracts, contracting tips, contract attorney, business law attorney, business lawyer, contract lawyer, contract litigation, business litigation, contract terms, physician agreements, business transactions, restrictive covenants, noncompetition agreements, covenants not to compete, business ventures
“The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.
Copyright © 2016 The Health Law Firm. All rights reserved.

Contracting 101: Tips for Physicians and Health Professionals – Part 3

4 Indest-2009-3By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

This blog is the first in a series intended to provide an introductory review of the basics of contracting for medical graduates entering the work force as residents and fellows, primarily by discussing employment agreements. We will highlight many of the common provisions found in employment contracts, along with many of the mistakes and pitfalls that we see in our day-to-day practice.

By the end of this series it is our hope that medical graduates will better understand the common language and terms found in employment contracts for professionals. These tips purpose to assist new professionals in recognizing common mistakes made by physicians and health professionals when negotiating contract terms. We hope to help make both employers and employees more knowledgeable about employment contracts so they can avoid potential problem areas and legal entanglements.

Our comments here are meant to provide general rules we have learned from our experience. However, please remember, every situation is different and there are exceptions to every rule. These tips are not intended to constitute legal advice. We recommend contacting an experienced health attorney for questions or concerns regarding specific employment contracts, or to thoroughly review all of the contract terms prior to acceptance.

The first part of the series can be found here. The second part of the series can be found here.

Tip 6 – Be Sure That You Receive a Signed, Dated Copy Back Before You First Start Working.

If you are an employee, be sure that you receive a copy of the contract back that has actually been signed and dated by the employer. One of the most common legal problems we encounter when we consult with an employee whose employer has broken the contract is the absence of a signed or dated copy of the contract. Anyone can type up a blank contract. There may be many preliminary drafts of a contract that are not agreed to or executed by the parties. How can you prove that this is the actual agreement between the parties if you do not have a copy that is signed by the parties?

Tip 7 – Make Sure That all Exhibits, Schedules, Addendums and Referenced Documents are Attached to the Contract.

We often see contracts which refer to attached exhibits for job requirements, bonus calculations, benefits, employer handbooks, employer code of ethics or conduct, etc. However, in many cases these are not completed or not attached to the contract when it is signed. Make sure that any documents that are referred to by the contract are actually attached to it and are completed.

These are part of the contract. Your copy of the contract is not complete without them.

Tip 8 – Amend the Contract, By Hand if Necessary, to Make It Consistent with the Agreement of the Parties.

A contract is not a sacred document. You may write on it, if necessary, to amend it. You may also attach separate handwritten amendments to it. Just make sure any handwritten changes on the contract itself are initialed by each party. Make sure any amendments attached to it are signed and dated by each party to the contract. Remember, also, that the changes must be understandable. If a judge is later called on to read it and interpret it, it must be clear to the judge.

Under the general rules used to construe contracts, typed changes and amendments to preprinted forms take precedence over the preprinted portions. Handwritten changes and amendments take precedence over typed or preprinted portions, and spelled out numbers and dates supercede numerical ones (if there is a conflict). However, there must be evidence that these were agreed to by both parties (such as initials or signatures prove).

Future Blogs on Employment Contracting.

In our future blogs, we will continue to provide tips on various issues to watch for in health care employment contracts.

Contact a Health Care Attorney Experienced in Negotiating and Evaluating Physician and Health Professional’s Business Transactions.

At the Health Law Firm we provide legal services for all health care providers and professionals. This includes physicians, nurses, dentists, psychologists, psychiatrists, mental health counselors, durable medical equipment suppliers (DME), medical students and interns, hospitals, ambulatory surgical centers, pain management clinics, nursing homes, and any other health care provider.

The services we provide include reviewing and negotiating contracts, preparing contracts, helping employers and employees enforce contracts, advice on setting aside or voiding contracts, litigation of contracts (in start or federal court), business transactions, professional license defense, opinion letters, representation in investigations, fair hearing defense, representation in peer review and clinical privileges hearings, litigation of restrictive covenant (covenants not to compete), Medicare and Medicaid audits, commercial litigation, and administrative hearings.

To contact The Health Law Firm, please call (407) 331-6620 or (850) 439-1001 and visit our website at www.TheHealthLawFirm.com.

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law. He is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

KeyWords: physician employment agreement, physician employment contract, health professional contracting, negotiating business transactions, physician contracts, contracting tips, contract attorney, business law attorney, business lawyer, contract lawyer, contract litigation, business litigation, contract terms, physician agreements, business transactions, restrictive covenants, noncompetition agreements, covenants not to compete, business ventures

“The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.
Copyright © 2016 The Health Law Firm. All rights reserved.

CONTRACTING 101: TIPS FOR MEDICAL GRADUATES ENTERING THE WORKFORCE – Part 2

4 Indest-2009-3By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law
This blog is the first in a series intended to provide an introductory review of the basics of contracting for medical graduates entering the work force as residents and fellows, primarily by discussing employment agreements. We will highlight many of the common provisions found in employment contracts, along with many of the mistakes and pitfalls that we see in our day-to-day practice.

By the end of this series it is our hope that medical graduates will better understand the common language and terms found in employment contracts for professionals. These tips purpose to assist new professionals in recognizing common mistakes made by physicians and health professionals when negotiating contract terms. We hope to help make both employers and employees more knowledgeable about employment contracts so they can avoid potential problem areas and legal entanglements.

Our comments here are meant to provide general rules we have learned from our experience. However, please remember, every situation is different and there are exceptions to every rule. These tips are not intended to constitute legal advice. We recommend contacting an experienced health attorney for questions or concerns regarding specific employment contracts, or to thoroughly review all of the contract terms prior to acceptance.

The first part of the series can be found here.

Tip 4 – Make Sure the Parties are Identified.

In many contracts we review, the correct names of the parties, especially the employer, are not included. Often, the only identification of the employer is a fictitious business name or part of a fictitious business name. Additionally, many business entities are not incorporated in the state in which the job is located. There is a misconception that a corporation or limited liability company, its owners and directors have far greater legal protections in states such as Delaware. Therefore, a disproportionately greater number are incorporated or organized there.

Often a large institution such as a hospital system or health maintenance organization (HMO) has a business entity to hire and manage its physician and other health professional employees. Sometimes a potential employee may incorrectly believe that he or she is being employed by the larger organization. More often, the business entity that employs the health professional is actually a wholly owned subsidiary corporation or company.

Always be sure that the contract includes the complete name of any corporation or company, the state in which it is incorporated (or organized or registered), its address and its fictitious business name (sometimes called a d/b/a or “doing business as” name). We include the complete identities and addresses of each party to the contract in an addendum, if they are not included in the main contract.
Tip 5 – Make Sure That the Employee or Contractor is Fully and Consistently Identified and Treated as Such Throughout the Contract.

In the case of physicians and many other health professionals, a medical group or business with which that person contracts may seek to treat him or her as an independent contractor instead of an employee. Independent contractors have far fewer rights and protections against the party with which they are contracting and have to incur a number of expenses that a true employer would have to pay otherwise.

It may be legally incorrect for a group or business to attempt to treat someone as an independent contractor instead of an employee. This may be attempted by someone who has received incorrect advice on how to evade taxes or to avoid paying legally required taxes and fees (such as Social Security deductions and workers compensations insurance payments). If the Internal Revenue Service (IRS), Department of Labor or Department of Finance scrutinizes the employing entity, it may result in an assessment of back taxes and penalties, stop work orders and other sanctions being taken against the employer.

In most cases, doctors, nurses, physical therapists, dentists, psychologists, nurse practitioners, physician assistants, mental health counselors, massage therapists and other health professionals should be treated as employees. The law requires that an employer pay a portion of the taxes, social security and other government assessments for those employees. Being an employee usually requires the employer to include the employee in any health insurance, retirement plans or other employer benefit plans which the employer has. The employer is also required to incur the costs of withholding taxes, unemployment compensation assessments, social security payments and other government-required deductions and forwarding them to the correct government entity. This saves administrative costs an employee might otherwise have to incur.

If the health professional has his or her own professional service corporation (sometimes called a professional association or “P.A.”) or limited liability company (L.L.C.) then this business entity can be contracted by another group or business as an independent contractor. The individually-owned P.A. or L.L.C. is the employer of the health professional.

Employees receive an IRS Form W-2 at the end of the year. This recaps the withholdings, Social Security, Medicare, unemployment compensation and other taxes and assessments deducted from their pay. Independent contractors receive an IRS Form 1099 at the end of the year with the total compensation paid to them reflected on it.

Employers are vicariously liable for the negligent acts of their employees while they are within the scope and practice of their jobs. The company or group that retains an independent contractor is not liable for the negligent acts of the independent contractor under the same circumstances.

Regardless, it is important that a contract accurately identify whether the health professional is an employee or an independent contractor. It must also consistently refer to and treat the individual as either an employee or independent contractor throughout the contract. If the contract is one that an employer has taken and tried to modify without the help of an attorney, it may use the term, incorrectly or include conditions that violate the law or that negate the treatment desired.

It is almost always far more advantageous for the individual being hired to be treated as an employee.

Future Blogs on Employment Contracting.

In our future blogs, we will continue to provide tips on various issues to watch for in health care employment contracts.

Contact a Health Care Attorney Experienced in Negotiating and Evaluating Physician and Health Professional’s Business Transactions.

At the Health Law Firm we provide legal services for all health care providers and professionals. This includes physicians, nurses, dentists, psychologists, psychiatrists, mental health counselors, durable medical equipment suppliers (DME), medical students and interns, hospitals, ambulatory surgical centers, pain management clinics, nursing homes, and any other health care provider.

The services we provide include reviewing and negotiating contracts, preparing contracts, helping employers and employees enforce contracts, advice on setting aside or voiding contracts, litigation of contracts (in start or federal court), business transactions, professional license defense, opinion letters, representation in investigations, fair hearing defense, representation in peer review and clinical privileges hearings, litigation of restrictive covenant (covenants not to compete), Medicare and Medicaid audits, commercial litigation, and administrative hearings.

To contact The Health Law Firm, please call (407) 331-6620 or (850) 439-1001 and visit our website at www.TheHealthLawFirm.com.

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law. He is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

KeyWords: physician employment agreement, physician employment contract, health professional contracting, negotiating business transactions, physician contracts, contracting tips, contract attorney, business law attorney, business lawyer, contract lawyer, contract litigation, business litigation, contract terms, physician agreements, business transactions, restrictive covenants, noncompetition agreements, covenants not to compete, business venture

“The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.
Copyright © 2016 The Health Law Firm. All rights reserved.