Physician Contract Red Flags to Check Before You Sign

The physician contract red flags that cost the most are rarely in the salary line. They hide in the non-compete, the malpractice tail, the productivity formula, and the termination clause. A base that looks strong can sit next to a claims-made policy with no employer-paid tail, a non-compete wide enough to force you out of the region, and a wRVU schedule that quietly caps your income after the guarantee ends. Before you sign a first or a fifth contract, read past the salary and check the terms below. This is educational career coaching, not legal advice, and a physician contract should always be reviewed by a qualified health-law attorney.

A non-compete that is too broad

The single most consequential clause in many physician contracts is the restrictive covenant. A non-compete with a large radius and a long duration can force you to move your family to keep practicing your specialty if the job does not work out. Read the exact radius, the term in months or years, and whether it is measured from each facility you cover, which can stack into a huge exclusion zone. Enforceability depends on your state: several states, including California, North Dakota, and Oklahoma, broadly bar non-competes, and the federal attempt at a nationwide ban was blocked in court, so state law governs. Where they are enforceable, narrow the radius, shorten the term, and ask for carve-outs.

No employer-paid tail on a claims-made policy

Malpractice coverage comes in two flavors, and the difference is worth thousands of dollars. A claims-made policy only covers claims filed while the policy is active, so when you leave you must buy tail coverage to stay protected for care you already provided. That tail commonly costs 1.5 to 3 times your annual premium, as a lump sum, the day you depart. If the contract makes you pay it and says nothing about the employer covering it, that is a red flag. Ask the group to pay the tail, or to provide occurrence-based coverage, which needs no tail at all.

A vague or unfavorable wRVU formula

Your salary guarantee usually lasts one or two years. After that, many contracts pay you on production, measured in work relative value units. If the contract does not state the dollar conversion factor per wRVU, the productivity threshold, and how those numbers can change, your long-run pay is undefined. That is a red flag on its own. Ask for the conversion factor in writing, the recent average wRVU output for the role, and whether the factor is fixed or can be lowered by the employer. The formula, not the guarantee, is what you will actually earn.

Short or one-sided termination notice

Look at the without-cause termination clause and check that the notice period is both reasonable and symmetric. A contract that lets the employer end the relationship on 60 days notice while binding you for a year is a red flag. Pair a short without-cause notice with a broad non-compete and you have a genuinely bad position: the group can let you go quickly, and the covenant still stops you working nearby. Read the two clauses together, not separately.

Undefined call, coverage, and duties

If the contract says you will take call or cover shifts "as assigned" with no cap, you have signed a blank check on your time. Push for specifics: how often you are on call, the maximum, how coverage is shared, and what happens when the group is short. The same goes for the scope of duties. Vague language here is where burnout and unpaid work live, and it is far easier to fix on paper than after you start.

Signing bonus and relocation clawbacks you did not read

A signing bonus with a payback clause is normal, but the schedule matters. Check how much you owe back and for how long, whether it forgives gradually or all at once, and how a repayment would be taxed if it crosses a tax year. The same applies to relocation assistance. These are not reasons to reject the bonus; they are reasons to negotiate the schedule and to know the real cost of leaving early.

Verbal promises that are not in the contract

Partnership track, future raises, a lighter call schedule "once you are established," and administrative time are commonly promised in interviews and left out of the agreement. If it is not written, it does not exist. A red flag is any material term that a recruiter describes enthusiastically but the document does not mention. Ask for the partnership timeline, the buy-in terms, and any promised schedule to be put in writing before you sign.

How to work through a physician contract

Read the entire agreement once for the map, then a second time listing every term you want changed. Benchmark your specialty against MGMA or Doximity data so your compensation asks are anchored to real figures, and price the tail and the non-compete as actual dollars, not afterthoughts. It helps to run the agreement through a contract review that flags the risky clauses in plain language before your attorney call, so you arrive with sharp questions rather than a cold read. Then have a health-law attorney review it, because the enforceable traps are exactly the ones a self-read misses. For a term-by-term walkthrough of what to counter, see physician contract negotiation.

The bottom line

The expensive physician contract red flags are the non-compete, the missing employer-paid tail, the vague wRVU formula, the short or one-sided termination notice, and any material promise left out of the document. None of them show up in the salary line, and all of them are negotiable. Read the whole contract, price the risky clauses, and get a health-law attorney involved before you sign. Counteroffer benchmarks the pay and helps you organize the counter. See the physician contract playbook. This is educational coaching, not legal or financial advice.