Residency teaches you medicine. It does not teach you contracts. So when the first offer letter lands, three months before graduation, with a number that looks bigger than anything you have ever earned, the temptation is to sign it and move on.

Don't. The first contract is the single most expensive document most physicians will sign in their career, and it sets the floor for every renegotiation that follows. Here is what to look for, in order.

1. Base salary is the easiest thing to compare, and the easiest thing to lowball

Most offers come in below the p50 for your specialty and region. That is not malice; it is the hospital's job to start low. Your job is to know where p50 actually sits, by specialty, region, and employment model, and to anchor your counter there or above.

Get specialty-specific data. National averages are useless. A hospitalist in the Northeast and a hospitalist in the rural Southeast are not in the same comp universe.

2. Signing bonus is leverage, not a gift

Signing bonuses almost always come with a clawback: if you leave before year two or three, you owe it back, sometimes pro-rated, sometimes not. Read this clause carefully:

  • How long is the clawback period? Two years is standard. Three is aggressive. Four is a red flag.
  • Is it pro-rated? If you leave at month 18 of a 24-month clawback, do you owe 25% or 100%? “100%” is a non-starter and easy to negotiate.
  • What triggers it? “For any reason” or “for cause”? The latter is fairer.

Rule of thumb

The signing bonus is not free money. It is a loan you repay through service. Treat it as a comp lever you can trade for base, not a windfall.

3. wRVU thresholds: where the real money hides

If your contract is productivity-based, the conversion factor (dollars per wRVU) and the threshold (wRVUs you produce before the bonus kicks in) determine whether the contract is generous or punishing. We wrote a whole post on this, but the short version:

  • A conversion factor below specialty p50 is a haircut. Period.
  • A threshold set above specialty median productivity is a structural way to never pay the bonus.
  • Quarterly reconciliation is better than annual. Annual lets the hospital float the money for 12 months interest-free.

4. Call coverage: hours and dollars

Call pay is one of the most under-negotiated line items in physician contracts. Hospitals know it; that is why they offer flat $500-$800 per day for call that, in a busy market, is worth $1,500+. Ask:

  • Is call pay flat or activity-based?
  • How many call days per year are required vs. optional?
  • Is there a cap, and does the cap reset by quarter or year?

5. Tail coverage (malpractice): the silent six-figure bill

If your contract is claims-made malpractice (most are), leaving without tail coverage means you are personally on the hook for any lawsuit filed after your last day. Tail coverage for an attending can run $30,000 to $80,000.

Always ask: who pays the tail? “Employer pays” should be in writing. “Employer pays if you stay X years” is a retention clause in disguise. “Physician is responsible” is a deal-breaker, full stop.

6. The non-compete

A non-compete with a 25-mile radius and a 2-year term in a specialty-thin market means you are leaving the city if this job doesn't work out. We have a primer on this; the TL;DR is that radius, duration, and scope are all negotiable, and most physicians do not realize it until it is too late.

7. The four clauses to read three times

Before you sign, read these clauses out loud. If anything in them surprises you, do not sign yet:

  1. Termination without cause. How much notice does each side owe? 90 days is standard. Anything less for the employer and more for you is a red flag.
  2. Tail coverage assignment. See above.
  3. Non-compete radius and duration. Mile-radius, term, and definition of “competing practice.”
  4. Schedule and call obligations. Vague language here (“as needed,” “reasonable schedule”) is how 60-hour weeks get baked into a contract you thought was 40.

The bottom line

You do not have to be a contract lawyer to negotiate well. You have to be prepared, anchor on data the hospital is also looking at, and know which clauses are worth fighting for. The first offer is rarely the last offer. The hospital expects a counter; it is built into their process.

If you read nothing else: do not sign on the first read, do not sign without comparing comp to specialty-and-region data, and do not sign tail coverage that puts the bill on you.

Want a pro to walk through your offer with you? Book a free 20-minute call. Our fee is 10% of what we add to your first-year pay, so if we can't find upside, you don't pay.