Can a physician work as locum tenens with a full-time job? The answer to that is yes, but it will depend upon the contract wording. Most employment contracts will contain language about either exclusivity or, many times. It’s also called outside activities. And those sections will state that the physician can only work and provide services to that employer. That is unless the employer gives them specific written approval to pursue another job opportunity in their off time. This is specialty-dependent, but it is possible, but you can’t just do it on your own normally. Now, people who do shift work like ED and hospitalists. Maybe some are doing critical care and only working a certain number of shifts per month.
Locum Tenens Physician Job
And then they have 12 to 16 shifts as a normal range for most people doing those shifts. So, they have plenty of time to do locum tenens work. They could go to another hospital and staff that ED or do hospital work in the other hospital as well. Most employers don’t want them doing locum tenens work for direct competitors. In any normal situation, the physician would then say to the employer. I have an opportunity to take a locum tenens contract with this specific employer in this particular place. I would like your written approval. And then, typically, the employer will not withhold that approval if it’s a reasonable request. If it’s hey, I want to work across the street with your direct competitor. Three times a month. It’s probably unlikely that the employer will be okay with that.
There are also some considerations in what’s the non-compete. Many contracts prohibit not only competition after the contract ends but also during the contract. So, can physicians work locum tenens with a full-time job? Absolutely, but it’s specialty-dependent, and they need to get written approval. I have had people say, well, do I have to do this? And then what are the repercussions if I do this without seeking permission first? You need to do this if it’s in the contract and stated. That means getting approval to work in any kind of outside employment. If you don’t do that, then it’s a breach of contract. The employer can say, look, you signed an agreement that said you had to do this, and you didn’t do it.
Doctors Working Locum Tenens Jobs
You’re a breach of contract, and we will terminate you for a cause. That’s one repercussion. Why do employers do this? Well, beyond the competition portion of it, they’ll generally require that the physician provide proof of malpractice insurance. A malpractice policy only covers the physician services for a specific employer. Not because the physician has a malpractice policy with their employer. That doesn’t mean it covers them for doing services for another employer. Usually, their current employer would state yes. You can do this job. But you must provide proof that you have a malpractice policy covering your services for them for a period. So, yes, you can work as a locum tenens, but you need approval for the most part.
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Difference Between a Physician Offer Letter and a Contract
What’s the difference between an offer letter and an actual employment contract? Is the offer letter binding? Some employers will ask that the physician sign an offer letter that dictates the basic terms of the agreement. Generally, the basic terms in an offer letter include:
- Any other kind of compensation
- Signing bonuses
- Relocation assistance
- Getting into the benefits of PTO
- What they’ll pay for as far as dues and fees
- The basic terms of the non-compete are
- PTO will be 30 days
- Base compensation in year one will be $300,000
Many physicians don’t want to go through the hassle or expense of drafting an employment agreement. If they can’t at least come to terms on the basic level of what will be in the employment agreement itself.
Offer Letters From a Practice
Many physicians will ask, okay, I have signed the offer letter. I now have the employment agreement. After reviewing it, I don’t like what’s in there. Maybe it’s substantially different than what was in the offer letter. Am I bound to the offer letter? And the answer to that is no. However, the basic terms have been agreed to and incorporated into an employment agreement. Many complicated and nuanced things could be in an employment agreement. After reviewing the basic terms, the job looks great. But I was then getting into the exact details of the employment agreement. The job doesn’t look so great anymore. Usually, the areas that might not be in the offer letter but might make an employment agreement terrible. That would be the nuts and bolts of the non-compete and non-solicit.
Suppose the offer letter says it’s one year and five miles when you get into the agreement and get into the details. In that case, it’s one year, but then it’s five miles from every facility a healthcare network owns. One location for five miles is usually reasonable. 100 locations for five miles is not. And that could be, for a physician, an absolute no. I’m not signing this agreement because it has this. Or maybe if someone’s on a net collection-based compensation structure for a contract and the offer letter says you’ll get 40% of all net-collections. Still, in the actual agreement, it’ll say that when the contract terminates, you won’t get any collections. The physician in that scenario would be working for free for the last three months. That is because they wouldn’t get anything they produced and collected after the contract ends.
Offer Letter vs. a Contract
And that can be an absolute no. I’m not signing this. So, in short, no, the offer letter is not binding. Things can change from the offer letter to the details of the actual employment agreement. And it is well within the physician’s rights to tell the employer after reviewing the agreement details. I’m not going through or negotiating some changes to make it palatable to them and saying. However, I signed the offer letter, but I’m not signing this agreement. And there’s not much the employer can do about that.
What Is an Example of Physician Moonlighting?
Today, I’m going to talk about some examples of moonlighting for a physician. There are two things to think about. When a physician signs an employment contract, there’ll be a clause called either exclusivity or outside activities. Prohibits the physician from doing any moonlighting, locums, or side work involving the practice of medicine. That is without getting the written approval of the employer. We’re going to get into that in a second. Moonlighting as a physician in general means working for another employer outside of their main full-time job. Shift work and specialties are probably the ones that do this the most.
ED, hospitalists are working seven-on/seven-off. An average emergency medicine physician or hospitalist schedule. Suppose they have seven days off. Then many times, they’ll want to pick up shifts elsewhere. And in that case, that would be considered moonlight. Now, if a physician is employed, let’s take a hospitalist employed by a hospital. The physician is employed with a hospital and signs an employment agreement. The employment agreement is going to state this is your exclusive employment. This is your full-time job, the only job you can have without getting our written approval to do something else. Suppose the physician wanted to work outside the organization. He was maybe doing some locums or picking up shifts at another local hospital. The employer would have to say yes, you’re allowed to do this. And it’s okay.
Requirements to Provide Before the Moonlighting Jobs
In that scenario, if an employer says the physician can moonlight. Then usually, there will be a couple of things the physician must do. First, the employer will likely require the physician to provide proof of professional liability and malpractice insurance. Suppose a physician is working outside of their full-time job. In that case, that employer will say, look, yes, you can work elsewhere. Still, it would help if you showed us that you have malpractice insurance for that job specifically. The malpractice insurance is employer-specific for a physician. A physician doesn’t just have one malpractice policy that covers any practice of medicine anywhere at any time. That’s not how it works. It’s employer specific.
So, the physician will have a malpractice insurance policy for their full-time employer. And then if they’re going to moonlight or locums. They would also have another professional liability insurance policy that covered that employer.
Many employers don’t want to deal with issues if that physician isn’t insured. Maybe the physician doesn’t even understand that they need insurance for that position. Whoever is hiring them to do moonlighting should also know that they need a different policy. But that’s one of the main concerns why employers don’t let people moonlight or do locums without having proof that they’ll get insured in that position.
Employers Avoid Possible Competition
Another consideration is competition. Many employment agreements will state that the employee cannot compete with the employer during the contract term and after the contract terminates. It can state. Specifically, you cannot work with a competitor organization during the term of this agreement. And that could be different than the actual non-compete, which will take effect after the agreement ends. Let’s take the hospitalist as an example as well. The hospitalist works for one hospital. The employment agreement could state that you can’t work as a hospitalist within the county that the hospital is within 15 miles.
There’s no competition among shift work physicians and people that work in the ED or as hospitalists. It’s not like you’ll steal a patient base from a hospital or anything like that. The biggest concern would be, suppose someone was a primary care physician employed by a hospital. Their clinic is off campus somewhere. They wouldn’t want to have that physician work at another primary care practice in the area. Maybe just on the weekends or something like that, build up at least some kind of patient base, and terminate the contract with the employer. And then move over to whatever job they were moonlighting with and maybe take the patients with them. Now, there will be other clauses in the contract that prohibit that. There will be a non-solicitation agreement.
As I said before, there’ll be a non-compete. Still, in the non-shift work positions, the employer fears that if they do moonlight. They’ll establish a presence somewhere else. Then, ultimately take those patients with them when they leave the original employer.
Picking-Up Additional Shifts
Moonlighting can also take the form of, let’s say there’s a hospitalist that works at one hospital. However, they’re in a larger network. And then there are hospitals within the network that they could also pick up shifts at. In that scenario, usually, you would not need written approval to do that. Most contracts will state that providers can pick up shifts within the network without needing permission.
Because typically, the malpractice policy would cover all the networks, not just one hospital. And so, in that scenario, it would be fine that the only reason why let’s say it’s hospitalists. They would want to pick up shifts elsewhere, outside the network. Let’s say they have an opportunity to pick up additional shifts either at their hospital or in other hospitals in the system. Why would they go outside? Well, it’s money. You’ll generally get paid more if you work in a locum tenant’s position. And maybe you’ll make 1500 a shift within the network. But then if you work a locums job, you’ll make 2200 shifts, something like that. So, that physician would want to work outside the organization because they can make more. Anyway, that are some examples of moonlighting for a physician.
Are No Moonlighting Clauses Enforceable for a Physician?
Suppose a physician is an employee or even an independent contractor associated with an employer. Generally, a language prohibits or requires approval from the employer for a physician’s outside activities.
Exclusivity is one way of referring to it. Outside activities are another way of referring to it: Moonlighting in residency, locums, that type of thing. I’d say most contracts group into outdoor activities. The agreement would state that if the physician wants to work for another employer when they’re providing the practice of medicine. They must get written approval from the employer for a couple of reasons. From the employer’s side, they don’t want their employee, the physician, to engage in medicine and interfere with their duties to the employer.
This is also specialty-dependent. Let’s say a physician is a hospitalist or works in the ED or seven-on/seven-off. The employer generally doesn’t care what they do on their week off. So, if the physician wants to pick up extra shifts, there’s usually no problem. However, they must let the employer know that they will do that. And then the employer would have to approve in writing that they’re allowed to do those things.
Most contracts will also state if the physician is going to work outside for someone else. They also must get their medical malpractice policy that covers their work with that employer. And then most places also want the physician to provide the employer with a copy of that malpractice policy to ensure that the physician is taking proper safeguards.
Who Covers Resident Physician’s Moonlighting Malpractice Insurance?
Now, if you are a physician and you are going to moonlight in residency or do locums or whatever on the side, that employer would provide, or at least should, malpractice insurance for you. They would be the ones to cover the cost of that policy as well. You can get a copy of that policy and then provide that to the new employer. Most employers simply don’t have a problem if the physician is going to work outside, as I said before if it doesn’t interfere with their duties to that employer.
Now, let’s say your primary care. Then you want to work on the weekends at another primary care office, potentially building up a patient base. Then your current employer may say, we don’t want you doing that because maybe if you leave, there would be anti-competitive behavior. And perhaps you could siphon patients away from our practice. So, no, we’re not giving you approval. You can’t do outside activities.
But if maybe you’re a surgeon, let’s say you’re a pediatric plastic surgeon working for a children’s hospital. Still, you also want to do some general plastic surgery on the side, maybe at a surgery center for a different employer. Usually, in that scenario, the employer wouldn’t care that you’re doing things on the side if it doesn’t interfere with your general duties for your current employer.
Are Physician Moonlighting Clauses Enforceable?
Now, are these clauses enforceable? Yes, they are. Some states will prohibit wholly unenforceable non-compete clauses. I’m not going to go through every state. Still, California, New Mexico, and Massachusetts, these states prohibit the employer from putting a non-compete into the contract. However, that does not generally apply when people get employed in other jobs. It only stops having the non-compete, which always takes effect after the contract is terminated.
But there will also generally be language that says, wow, the person is employed and working for us. They cannot compete with our employers. Or the easiest way to do it is to say. You must get written approval if you’re going to do any practice medicine anywhere while still employed with us. In that way, there’s no ambiguity about it. The employer then has complete control over the situation.
Why Do Physicians Need to Disclose Outside Employment?
So, if you’re a physician and have every plan to do locums, resident moonlighting, whatever you want to do. At the same time, you are employed, and there’s a clause that says, this is your only exclusive job, if you want to do anything else, you must get our approval. They absolutely can be enforced. They just can. So, before signing the employment agreement, you need to know if you have a current job that you would like to continue. Or maybe you have a career in mind that you’d like to pick while employed. Going through that before signing the employment agreement is the best way. Many contracts will have an exhibit at the end, which lists all the outside activities pre-approved by the employer. I certainly would state that the physician should do that. They need to disclose.
What happens if you don’t disclose outside employment? Well, you’re in breach of contract. Suppose you sign an agreement with the outside activities clause and start doing outside activities without getting approval. You are in breach of the contract, and they could potentially terminate the contract because of that. They can generally terminate it immediately in that type of situation, or maybe they would state, this is what your contract says. You can’t be doing these activities. We’re not going to terminate you; however, we will say that you must stop those activities immediately. So, that is resident moonlighting or at least a clause that states the physicians can’t make residency moonlight. Enforceable? Yes, but generally, some ways of working with the employer would allow the physicians to do that.
When Is Moonlighting Prohibited?
Can a physician work locum with a full-time job? The answer to that is yes, but it will depend upon the contract wording. Most employment contracts will contain language about either exclusivity or, many times. It’s also called outside activities. And in those sections, it will state that the physician can only work for. And provide physician services to that employer unless the employer gives them specific written approval to pursue another job opportunity on their off time. This is specialty-dependent, but it is possible, but you can’t just do it on your own normally.
Now, people who do shift work like ED, hospitalists, maybe some who are doing critical care and are only working a certain number of shifts per month. And then they have 12 to 16 shifts as a normal range for most people doing those shifts. So, they have plenty of time to do locum work. They could go to another hospital and staff that ED or do hospital work in the other hospital as well. Most employers don’t want them doing locum work for direct competitors. In any normal situation, the physician would then say to the employer.
I have an opportunity to take a locum contract with this specific employer in this particular place. I want your written approval. And then, usually, the employer will not withhold that approval if it’s a reasonable request. As I said before, if it’s: hey, I want to work across the street with your direct competitor three times a month, it’s probably unlikely that the employer will be okay with that.
Can Physicians Moonlight With a Full-Time Job?
There are also some considerations in what’s the non-compete. Many contracts prohibit competition after the contract ends and during the contract.
So, can physicians work locums with a full-time job? Absolutely, but it’s specialty-dependent, and they need to get written approval. I have had people say, well, do I have to do this? And then what are the repercussions if I do this without seeking permission first? If it’s in the contract and states you need to do this, meaning, get approval to work in any outside employment, and you don’t do that, then it’s a breach of contract. The employer can say, look, you signed an agreement that said you had to do this, and you didn’t do it. You’re a breach of contract, and we will terminate you for the cause. That’s one repercussion. Why do employers do this? Well, beyond the competition portion of it, they will also generally require that the physicians provide proof of malpractice insurance.
A medical malpractice policy only covers the physician’s services for a specific employer. Just because the physicians have a malpractice policy with their employer doesn’t mean it covers them for doing services for another employer. Usually, their current employer would state yes. You can do this job. But you must provide us with proof that you have a malpractice policy that covers your services provided for them for a period. So, yes, you can work as a locum, but you need approval for the most part.
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