Texas Medical Center. He says he negotiated with the hospi- tal, which agreed to waive the contract’s geographic language. Dr. Alissa opened up shop next door to Central Texas Medical Center. Before signing an employment contract with a hospital, Mr.
Kreager encourages physicians to have an attorney review it. He warns that while hospital administrators can’t make medi- cal decisions, they can impose rigid requirements on how phy- sicians make medical decisions. For example, he says, hospi- tal employment agreements frequently dictate the number of hours a physician must be in clinic and how many hours he or she must spend doing administrative work.
He advises physicians to pay close attention to noncom- pete clauses, which prevent physicians from competing with former employers if they decide to leave and open a practice elsewhere. The Tex- as Covenants Not to Compete Act sets the criteria for the en- forceability of the covenants. The law says noncompete clauses are enforceable if they meet certain physician-specif- ic requirements and contain reasonable limits on when, where, and how a physician can establish a new practice. For example, an overly restrictive noncompete clause could unreasonably limit the geographic area in which the physician can establish a new practice, pro- hibit him or her from opening a practice for more than two years, or require an unreasonably high buyout amount that prevents the physician from competing, says Mr. Kreager. (See
quire the appointment of a chief medical officer recommended by the medical staff of the hospital and approved by the hospi- tal’s governing board. The chief medical officer oversees each physician employed by the hospital and is the hospital’s desig- nated contact with the Texas Medical Board. The legislation states: “The chief medical officer shall im- mediately report to the Texas Medical Board any action or event that the chief medical officer reasonably and in good faith believes constitutes a compromise of the independent medical judgment of a physician in caring for a patient.” In addition, hospitals control contracting with payers,
“The Texas legislation could serve as a model for other states.”
which Mr. Kreager says can be a blessing or a curse. “The hospital has great negotiating power and may be able to get better reimburse- ment negotiating on behalf of the physician. The risk is the hospital has no incentive to maximize the physician’s compensation through reim- bursements. The hospital may choose to trade off by dis- counting some of those phy- sician reimbursements in ex- change for better reimburse- ment for inpatient services rendered by the hospital,” he said.
Finally, Mr. Kreager advises physicians who enter into any employment arrangement to “plan his or her exit before sign- ing the employment agreement.”
He suggests physicians get the answers to these questions to form an exit strategy:
“Warning: Know What You Sign,” February 2011 Texas Medicine, pages 33–35.) According to Mr. Kreager, hospitals may recruit Texas physi- cians in one of four ways:
1. To join an existing practice; 2. To open their own practice; 3. To work as solo practitioners who share offices and expens- es with physicians already practicing in the community; or
4. To work for an NPHC. Texas law prohibits the corporate practice of medicine. The
Texas Medical Practice Act generally prevents physicians from entering into partnerships, employee relationships, fee split- ting, or other situations in which a nonphysician controls the practice of medicine. Mr. Kreager says working for a hospital’s NPHC is funda- mentally different from joining an existing practice or working as a solo practitioner in that the employment arrangement al- lows a nonphysician to make decisions regarding patient care, protocols, use of medical devices, and other matters. Last year, TMA helped passed Senate Bill 894 by Sen. Rob- ert Duncan (R-Lubbock). The bill contains provisions that re-
• After I leave, may I take my charts with me? • Will I have to buy tail coverage liability insurance? • May I take my support staff? • If I sold my equipment, may I buy my equipment back? • If the hospital is furnishing the office space, may I continue the office lease in my name?
Physicians need to make sure the employment agreement
addresses each topic on the list, Mr. Kreager says. For example, the contract might state that if an employer terminates a phy- sician’s employment without cause, the physician may take custody of the charts for the patients he or she treated.
Practice setting trends Preliminary findings of TMA’s 2012 Physician Survey allow the
association to glean information about why physicians make certain career decisions. Physician respondents who started out as or subsequently became full or part owners of their main practice cite personal control of practice decisions (83 percent), personal control of practice clinical decisions (70 percent), and opportunities for practice growth and profitabil- ity (68 percent) as reasons they became practice owners. On the flip side, 46 percent of physicians list dealing with man-
February 2013 TEXAS MEDICINE 17
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