Ophthalmology Contracts

The formulas: three ways to price the same case list

The work unit formula pays for effort. The collections formula pays for revenue. The salary pays for presence. Under a work relative value unit model, every service carries a unit value, and pay is units produced times a conversion rate, commonly drawn against a base salary with a threshold where the production rate takes over. The model insulates the physician from the payer mix entirely: a cataract case pays its units whoever sits in the chair.

Under a collections model, pay is a stated percentage of what the practice actually collects on your work, so the mix, the billing operation's denial rate, and its speed all become components of your income. Under a straight salary, production pays nothing at the margin, and the negotiation moves to renewal, where your recorded volume is the argument. Hybrids split the clinic and the surgery between the two formulas, and each hybrid is priced by pricing both halves.

The levers inside any formula are the same three, all negotiable, all in writing. The rate itself, conversion dollars per unit or the collections percentage. The threshold, the production the base salary covers before the rate applies, because a generous rate behind a high threshold can pay less than a modest rate behind a low one at any realistic volume.

And the crediting rules: whether premium lens and refractive work counts inside the formula, whether sessions at the surgery center produce credit where the employer does not bill the professional fee, and how the bundled post operative visits inside the surgical fee are treated. Ask for the production history of the physicians in the role, in the formula's own units, and multiply before admiring.

The payer mix: the number under the collections formula

A collections percentage is meaningless until the mix is described. The cataract schedule of a practice whose volume runs heavily through government payers collects differently per case than a practice with a strong commercial book and a premium lens and refractive practice on top of it, at identical surgical effort. The mix is set by the market, the referral base, and the practice's own contracting, and a new attending inherits it whole.

Ask for it in aggregate: the share of collections by payer class for the department or the role, the practice's overall collection rate on professional charges, and the denial and adjustment pattern the billing operation runs. A practice that tracks its revenue answers in one meeting. A practice that cannot describe its mix is telling you the central number of the collections model is unmanaged, and a percentage of an unmanaged number is a guess wearing a contract's clothes.

The mix also moves, which the contract should anticipate. Payer contracts renegotiate, a large employer's plan changes networks, a premium lens program grows or stalls. Under a work unit formula those movements land on the employer. Under collections they land on the physician.

That landing is the model's price, and it is why collections percentages in strong mix practices can be worth more than their headline suggests while identical percentages in weak mix practices are worth less than any salary on the table. Price the model you are actually being offered, in the practice you are actually joining, with its mix on the table.

Call: a compensation term, priced like one

Call pays in a stipend, in production credit, in time, or not at all, and the load is the first thing to price, ahead of the currency. Ophthalmology call covers the region's eye emergencies, open globes, acute angle closure, detachments, post surgical infections, and the consult stream from emergency departments and inpatient services. Divided across a large roster with hospital support, it is a modest obligation priced fairly inside a salary. Carried by a small roster across several facilities without subspecialty backup, it is a second job the salary may or may not describe.

Read the roster's real size, what happens to it contractually when colleagues leave, the facilities covered, whether the hospital pays any share of the stipend and under what contract of its own, and whether first call is screened by trainees at academic centers. At renewal, call becomes a trade currency in its own right, and the contracts that state the trade are the ones that protect it.

The exit clauses: tail and covenant

Two clauses are priced at signing and collected at exit, and both are heavier in this specialty than in most. If the malpractice policy is claims made, the contract must name who pays the tail, under what triggers, and whether the obligation survives the practice being sold, because the tail is a real check written on the way out and silence assigns it to the physician. The surgical claims horizon is long, which makes the endorsement valuable and its assignment worth a negotiation at entry, when it costs the employer a sentence.

The noncompete is read in four dimensions: the radius and the sites it is measured from, the length, the scope, including whether a surgery center ownership interest is barred separately and for longer, and the triggers, including whether it binds a physician the employer chose to release. Price both clauses against the career this specialty actually runs: the group across town, the buy in two suburbs over, the platform offer at the established stage. State law governs enforceability and varies widely, so the read is always local, the contract, the state rule, and the career map together.

The numbers side by side

Red flags in an ophthalmology contract

A tail clause with no name on it. If the coverage is claims made and the contract does not say who pays the tail at exit, the default answer is you, discovered on the way out.

A collections offer with an undescribed payer mix. The mix is the income under that model. A practice that will not describe it is asking you to sign a percentage of an unknown.

A covenant measured from every site, including the surgery center. Boilerplate radius language can bar the practice and the facility ownership you spent years building toward, in the town you live in.

A sign on bonus with a silent repayment trigger. Early money is a loan until the vesting date. The triggers, resignation, termination, a schedule cut, decide what the bonus really was.

A production threshold that resets upward at renewal by formula. A rate can stay generous while the threshold converts it into a pay cut. The record you keep is the counter.

Common pitfalls