No, that physician employment contract is not set in stone

AMA News Wire

No, that physician employment contract is not set in stone

Oct 20, 2025

Resident and fellow physicians looking for their first jobs after completing training might face a challenge they have never encountered before: negotiating an employment contract.

It is natural to wonder, then, whether an employer will be willing to change the terms of the offer, and if so, by how much. Experts say the answer is simple, if frustrating: It depends.

“It has gotten more difficult” to negotiate physician employment contracts, said Richard H. Levenstein, a health care lawyer and shareholder in the prestigious law firm of Nason, Yeager, Gerson, Harris & Fumero, in Palm Beach Gardens, Florida. “The leverage that they [physicians] used to have is not there because you’re [often] dealing with a large institution. You’re trying to negotiate the contract that they claim to use for many of their other physicians.” 

Levenstein specializes in health care law and has decades of experience representing physician clients, including in negotiating their employment contracts. Though he said he has seen increasing rigidity in those contracts over the years, there are exceptions. Lawyers can help determine when, and where, a prospective health care employer might be willing to compromise and advise physician clients how best to address issues contained in provisions of the proposed contract.

“The attorney should be retained as soon as the resident begins to talk about a contract,” he said. “The earlier they call a lawyer, the more effective the lawyer can be.”

Experts and the AMA agree: Physicians need the help of an attorney well-versed in health care law to examine contract provisions.

The AMA has teamed up with Resolve to provide custom contract review to AMA members at a discount. Resolve offers personalized legal experience to help physicians secure the best employment contract terms, no matter where they are in their careers. Ready to access your AMA-member Resolve discount? Learn more now. 

Changes in practice type driving rigidity

Changes in practice type driving rigidity

With a smaller percentage of physicians than ever before working in private practice, employment contracts have changed, Levenstein said.

“In the last 10 years, physicians have become employed by large institutions like hospitals and others in such great numbers,” he noted. 

In fact, an AMA Policy Research Perspective released earlier this year—“Physician Practice Characteristics in 2024: Private Practices Account for Less Than Half of Physicians in Most Specialties” (PDF)—shows that 42.2% of physicians were in private practice in 2024, a dramatic drop from 12 years earlier, when 60.1% worked in that setting. The share of physicians in private practice does vary significantly by specialty. 

“Negotiating a private practice agreement, with a physician joining a group of other physicians, was easier because they really wanted that person and it was personalized,” Levenstein said. “You could get changes to the contract that were reasonably requested and do so much more easily than today.”

In smaller private practices, he said, the other physicians realized that they would be working with the new hire for years. Goodwill was often prioritized over minor contract details.

“Now, the employers want a uniform contract. They tell you that they can’t negotiate much of anything because they want everyone to have the same contract,” he said. He noted that the potential employer’s lawyers might say, “Well, I have five more that I can interview tomorrow waiting for us to get back to them for this position. So, if your client doesn’t want the contract the way we’re willing to give it, I’m sure they will.”

With so many factors to examine, physicians need help. The AMA recommends that all physicians, before signing any employment contract, retain the services of an attorney who specializes in health care employment law. 

And Resolve offers automated risk-assessment of contracts, a process that will flag areas of concern and identify the level of risk with each negotiating point. Then, physicians can get the help of an experienced attorney to negotiate the contract. 

AMA members get a 20% discount on all Resolve services, which include: 

• Custom contract review for any type of employment contract.
• Access to experienced attorneys who can negotiate on your behalf.
• Real-time, comprehensive compensation data and benchmarks to help you understand your worth.
• An instant contract-review option, powered by Resolve’s attorney-trained AI model.
• Free tools such as a contract scorecard to give a quick overview of where your contract stands. 

Where does flexibility lie?

Where does flexibility lie?

The biggest exception to the phenomenon of increasing contract rigidity arises when the position is difficult to fill for some reason. Harder-to-come-by specialists can demand more negotiation, Levenstein said.

“If I have a pediatric neurosurgeon who I’m representing, and I know that there are only three of them in the county,” he said. “I know that I can get what I want for that doctor because they need him or her. A lot depends nowadays on what specialty is needed in the area and what leverage they have in negotiating agreements.”

Flexibility also extends to the physician, who, with an attorney’s help, can decide where in a contract they are willing to bend and where they need to stand firm. Ultimately, there are always options, including turning down the job offer.

Brandi Ring, MD, the chair of obstetrics and gynecology at a 115-bed hospital in Keene, New Hampshire, has advice for physicians who find themselves facing potential employers unwilling to negotiate problematic contracts. 

“Trust your gut and don’t get into a situation where you are going to be abused and manipulated.
If it doesn’t feel right, walk away,” said Dr. Ring, an AMA member who has worked in both private and academic practice settings and who teaches a course on physician contracting and negotiation.

“I don’t think we tell people enough that they’re able to just walk away from job offers and say: This isn’t really what I want or what I need,” she said.

Often, a physician’s first contract can set the tone and direction for their career.

If you’re in the search for your first physician job after residency, get your cheat sheet from the AMA now. 

Explore further with the AMA STEPS Forward® toolkit, “What to Look for in Your First or Next Practice: Evaluate the Practice Environment to Match Your Priorities.” It is enduring material and designated by the AMA for a maximum of 0.5 AMA PRA Category 1 Credit ™. 

Learn more about AMA CME accreditation.