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As Hospitals Trend Toward Employee Physicians, What Are the Employment Law Consequences?

First few Article Sentences

The recent increase in hospital-employed physicians is expected to continue. This trend is motivated by a quest for unified quality of care, referrals and market share, uncertainty about the overhaul of the healthcare system and reimbursement changes, and physician desire for a better work-life balance. Regardless of the reasons, transitioning from an independent contractor relationship with a physician to an employee physician has many consequences in the employment law arena.

The advent of this new norm - employee physicians - presents a change in the hospital’s obligations to the physician beyond simply a motivating compensation model. The hospital now takes on many obligations to the physician. It must provide employee benefits, unemployment compensation, workers’ compensation, insurance and often retirement. The physician will receive the protection of employment laws such as the Americans with Disabilities Act (ADA) and the Family and Medical Leave Act (FMLA). Additionally, the discrimination and harassment provisions of Title VII, the Age Discrimination in Employment Act (ADEA) and similar state laws impact the relationship in a new way. Also, the hospital may choose to bind the physician to a reasonable and enforceable noncompetition agreement.


Vestal, Josephine

Peters, Sharon

Williams Kastner

Law, Employment

May 8, 2012

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