Win-win contract negotiations: Strategies for urologists

Urologists negotiating employment, payer, or other contracts often feel like they’re navigating unknown, hazardous terrain.

Thomas Stringer, MD, associate professor and associate chairman of urology at University of Florida, Gainesville, often reviews residents’ employment contracts. He recalls a recent hospital contract, where he urged the resident to seek clarification in key areas. But the resident wanted the job so much, he felt uncomfortable asking questions and potentially turning off the employer.

That’s a mistake, according to Dr. Stringer.

“This [contract] is your conditions of employment. You really need to define what those are so you can feel satisfied once you sign the thing. I think physicians tend to be pretty anxious about negotiating on their own behalf,” he said.

Dr. Stringer, who for 7 years directed the course, “Physician Contract Negotiation: Employment and Ownership in the Current Economic Climate,” at AUA annual meetings, says urologists are increasingly called upon to negotiate important and binding documents, like employment contracts.

Related - Danger zones: Easily missed aspects of contracts

“More and more physicians, in general, are employed. In the year 2000, almost 60% of all physicians were shareholders in their practices. Currently, that’s closer to 30% of all physicians,” Dr. Stringer said. “Our data suggests that the number of employed urologists is going up, and that’s according to AUA Census data. Fifty-one percent of urologists were employed in 2015; now it’s 56%. But there’s an age differential. According to the AUA Census, among urologists under age 45, 72% are employed.”

In fact, urologists can be employed by hospitals, health systems, academic institutions, independent practices, and the government.

“You even need an employment contract if you’re self-employed,” Dr. Stringer said.

Every entity has its own interests in mind when employing physicians. Sometimes, the interest is largely profit-driven. For example, private equity firms are a relatively new physician employer. Private equity firms have been buying physician group practices, including, in 2016, the purchase of Chesapeake Urology by Audax Private Equity.

“The goal of the private equity purchase is to scale up the business, build a portfolio, and sell it again in an average of 3 to 5 years,” Dr. Stringer said.

Urologists need to represent themselves to ensure employers meet their employment goals and interests. It’s critical especially for female physicians to negotiate well for themselves, according to Michele G. Cyr, MD, MACP, senior associate dean for academic affairs in biology and medicine and professor of medicine and medical science at Brown University, Providence, RI.

In 2017, the national gender gap for physicians increased compared to 2016 as female doctors earned 27.7% less ($105,000) than male doctors, according to Doximity’s second annual Physician Compensation Report, released March 14, 2018. There’s no medical specialty in which female doctors earn more than male doctors, and women earn less than men in all of the top 50 metro areas, according to Doximity.

Next:Negotiation fundamentalsNegotiation fundamentals

Contract negotiations aren’t about standing up, beating your chest, and making threats. They’re not about putting up walls.

Read: What traits are important to be a good urologist?

Rather, contract negotiations are about collaborating, according to Dr. Stringer.

“You want to have a win-win posture that you take with any contract negotiation. It’s a collaboration. If it’s not, it’s a competition or a compromise, but you would prefer it to be a collaboration,” Dr. Stringer said.

The process should involve conversation, not negotiation, according to Roger G. Bonds, MBA, FMSD, CMSR, chief executive officer of the physician consulting group PhysicianCareerAdvisor.com.

The first thing physicians should do when entering a negotiation is to think about what they really want as the outcome, according to Bonds.

“What are your concerns and what are your priorities?” Bonds said. “Realize that typically you are not in the strong position to negotiate everything that you want. For the most part, you’re going to be subservient to the organization that is writing the checks. Therefore, you have to make sure that the defenses don’t come up. You need to work with the employer, so that you’re asking good questions instead of demanding.”

Do your homework

The key to effective negotiation is preparation, according to Brown University’s Dr. Cyr. Urologists negotiating employment contracts, for example, need to get as much information as possible about benchmarks for compensation and productivity.

“The good news is, there is a wealth of information on the Internet,” she said.

Among the reliable resources: the Medical Group Management Association (www.mgma.com) and Association of American Medical Colleges (www.aamc.org).

Urologists should also tap professional organizations, like the AUA.

“I always also advise physicians going into negotiations to utilize colleagues, both inside and outside the organizations,” Dr. Cyr said. “Find out what their contracts look like, the terms of their employment, what things they felt were important to negotiate.”

A urologist’s compensation depends on many factors, according to Bonds. These include location, practice type, and more. It also depends on variables that go beyond base pay, including benefits-even continuing education reimbursement or relocation assistance.

Also see: How to set up e-prescribing for controlled substances

“There are many factors that can be very positive for the individual physician but also very positive for the practice. That’s where you’re looking for the proverbial win-win,” Bonds said. (Also see, “Danger zones: Easily missed aspects of contracts.")

Next:Need a lawyer?Need a lawyer?

Urologists should consider having legal representation, according to Dr. Stringer.

“No one is more motivated than you are to make the employment contract fit. But we often don’t have the expertise,” Dr. Stringer said.

Christopher L. Nuland, JD, a Jacksonville, FL-based health care attorney, suggests urologists have experienced lawyers review their contracts, but not necessarily hire those lawyers to do the actual negotiations.

“Lawyers, as a breed, tend to be contentious, adversarial, and expensive,” Nuland said.

Read: Is autonomy dead for the practicing urologist?

Lawyers can review the contracts and provide urologists with a written review of what they think should be changed. The urologist can then go into the negotiations, mentioning that they had their attorney review the contract and the attorney had some good points. The strategy, according to Nuland, is to let the employer know that the urologist would rather work things out without further involvement from an attorney.

“The urologist gets brownie points for not involving an attorney but also told the powers-to-be that he or she has an attorney if it comes to that,” Nuland said.