Tip of the week: Don't assume you can simply terminate an underperforming employed physician

Hospitals that are desperate to fill an employment vacancy may overlook red flags and bring in a physician who turns out to be a patient safety risk, and many hospitals incorrectly think that they can simply terminate this individual. However, terminating a physician is never a quick fix, says William Cors, MD, MMM, FACPE, CMSL, senior vice president of Inpatient Medical Associates in Livingston, NJ.

The first thing to consider is the employment agreement. Most agreements stipulate that if a physician is fired, he or she can no longer serve on the hospital’s medical staff (the employment agreement trumps the medical staff bylaws). However, there are some employment agreements that do not have this stipulation, and thus a fired physician who has granted clinical privileges can still treat patients at the hospital, albeit as an independent practitioner. Additionally, he or she would be entitled to any due process under the medical staff bylaws.

The second thing to consider is that firing an individual never results in a clean break. “Most employment agreements call either for immediate termination with cause or termination without cause but generally requiring a notice period, usually 60 to 90 days. So, if you have a physician with performance challenges, do you terminate them for cause and open the door to a wrongful termination suit or do you terminate them without cause?” says Cors. If your organization chooses to terminate a physician with cause, labor laws enable him or her to bring a wrongful termination suit against the organization. “The plaintiff may not prevail, but the lawsuit will eat up you organization’s capital, time and resources.” adds Cors. If your organization chooses termination without cause, “do you allow them to continue working knowing that they have bad outcomes, or do you suck it up and pay them severance pay for three months?” says Cors.

Be sure that every hiring decision is based on good credentialing and a thorough interview. Don’t hire an individual unless you are positive that he or she is competent and is a good cultural fit.

This week’s tip is from “The top six mistakes hospitals make when employing and contracting physicians,” in the March issue of the Medical Staff Briefing newsletter.