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What is the Law on Contracts of Medical Employment?

May 14, 2022

What is the Law on Contracts of Medical Employment?

A significant number of physicians, dentists, and other medical professionals work under employment contracts. Health care industry employment agreements are notoriously complex. The agreements must conform to both state and federal regulations. In this blog post, our Arizona medical contract drafting attorney provides an overview of the key things to understand about the law governing medical employment agreements. 

Arizona Law on Medical Employment Contracts

As a starting point, it is important to understand that contract law in the United States generally falls under state law. Employment agreements in the medical industry are no exception. This means that a health care employment agreement signed by a doctor or other medical professional working in Maricopa County must comply with Arizona law. Similar to in other states, all allopathic doctors are regulated by the Arizona Medical Board. Any medical employment agreement for this type of physician must meet their requirements. The Arizona Medical Board has strict rules in place regarding professional liability insurance, including tail insurance.

Beyond the professional rules on medical professionals, Arizona also has some other laws and regulations in place that could affect a health care industry employment agreement. One of the most notable examples is the state’s restriction on non-compete agreements. To be clear, non-compete agreements are legally enforceable in Arizona, including non-competes involving doctors and other medical professionals. However, non-competes are limited to terms deemed “reasonable” to protect the legitimate business interests of a healthcare provider. An overly burdensome non-compete may be rendered invalid and unenforceable in Arizona.  

Federal Law on Medical Employment Contracts

One of the things that makes medical employment contracts uniquely complicated is that there are a number of federal laws and regulations that affect medical providers and medical professionals. All medical employment agreements must also comply with these federal laws. 

As an example, the Health Insurance Portability and Accountability Act (HIPAA) provides strong confidentiality protection to patient medical records. Medical employment agreements should generally address electronic medical records (EMRs), including the EMR system, and any training. 

Additionally, federal law also regulates so-called “self-referrals.” The Physician Self-Referral law (or as it is more commonly known, the Stark Law) must be complied with. Failure to do so could lead to severe sanctions, both for a health care provider and an individual medical professional. 

A medical employment contract should be drafted and reviewed by a lawyer who has knowledge and experience involving all applicable state and federal laws. An attorney will ensure that the agreement is legally valid and enforceable. 

Get Help From a Medical Employment Contract Lawyer in Arizona

At Chelle Law, our medical employment agreement review attorneys have the professional skills and experience you can trust. If you have questions about the law on health care employment contracts, we can help. Give us a call now or send us a message to arrange your strictly private consultation. From our office in Scottsdale, our law firm provides medical contract drafting and review services throughout Arizona, including in Phoenix, Mesa, Chandler, Tempe, and Glendale. 

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