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Lesson 10: Contract Negotiation

Be your greatest advocate

A contract can be a complicated document. It’s smart to get as much in writing as possible, but there may be different interpretations of “standard” wording. Make sure to ask questions to ensure you completely understand what you’re signing.

Have your employment attorney review the contract to point out any issues you may not know about. It’s also important to know what you’re agreeing to when it comes to leaving the practice, non-compete disclosures, partnerships, patient ownership and benefits.

Remember, you can negotiate almost anything, but be ready for some give and take. Know what matters most to you and be willing to make a concession or two to get it.

Your locum tenens rate or your salary should be based on your specialty’s market demand and the facility’s location. Use a site like or to check the going rate.


Benefits go beyond compensation and healthcare insurance. You may be offered student loan repayment aid or a signing bonus. Additionally, be ready to negotiate if you’d like additional vacation time or time off for CME obligations.


RVU stands for "relative value unit." Some physician employers use a RVU formula to calculate compensation or bonuses for physicians. A RVU assigns value for the additional work you do beyond the hours you’re assigned.  It gives you a piece of the game that’s an incentive to keep productivity high.


A guarantee supplements salary while the practice is being built as the physician achieves high productivity. Usually, a guarantee is for the first two years.  The third year, it’s yours to earn.


Some facilities and even practices will offer packages to move you and your family to a new home within reasonable commuting distance to your new position.

Spouse assistance

Negotiate placement assistance that may be available for your spouse in finding employment after you relocate.

Potential problems with contracts:

  • Ensure you know who pays the tail coverage for your malpractice insurance.
  • A typical non-compete clause may bar you from working for 1-2 years within specified radius around facility’s primary market. But is that reasonable, given the facility’s location? If not, that could be an opportunity to negotiate better terms.
  • Get the location of the practice in writing
  • Understand the termination clauses and determine whether there are “clawbacks.” You’ll want to look out for employers who want to hold you responsible for the entire recoupment to the insurance company. Additionally, you’ll need to understand how your compensation works if you are terminated. A contract may lock you in to the job for years, which could mean you’re financially responsible in you leave before then.

Make sure anything agreed upon is in the written contract because spoken promises don’t count!

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