Service Agreements for Healthcare Professionals

Associates play a vital role is the successful operation of your practice. Associate Agreements define the contractual relationship between the Associate and the corporation and/or clinic which is why it is essential to have them reviewed and/or amended. At MEDICALOI each service agreement is tailored to the needs and expectations of our clients in order to better serve their interests.

Service Agreements Should Contain the Following Essential Clauses:

While the parties to a service agreement are free to negotiate the terms of their agreement, there are certain, what we like to refer to as “non-negotiable” clauses, that should appear in any given service agreement for the protection of both parties.

Designation Of the Parties

As obvious as this element might seem, the designation of the parties is a crucial component of the service agreement as it will define who the associate is (a physical person or a legal person i.e. a corporation). Similarly, it will indicate who the beneficiairy of the the services will be, i.e. the corporation.

Description Of Professional Services

A carefully drafted service agreement includes clauses regarding the professional services to be rendered, the associate’s remuneration, schedule, vacation, duration of the agreement, restrictive covenants, and of course any other elements that the parties consider appropriate to include in light of the corporation’s objectives.

The service agreement should also include the corporation’s internal policies such as:

• Professional Conduct
• Clauses governing personal conduct that could potentially harm the reputation of the practice
• Performance Criteria
• Clauses determining whether the associate is responsible for providing specialized equipment
• Confidentiality and non-disclosure agreements
• Liability Clauses

Remuneration

Details regarding compensation are often key to securing the services of an associate for your firm. A contract should include compensation details, such as payment method, benefits available, and opportunities for compensation increases, if applicable. It is essential to provide complete information on how compensation will be determined, including deductions for fees or other costs, to demonstrate transparency in your activities. Mandates may also consider describing the procedures they have in place to provide the associate with billing documentation to confirm correct compensation and methods for resolving disputes in the event of identified errors.

The Term

The term or duration of the associate’s agreement allows us to determine the period in which the agreement is in force. It can either be a fixed term – which is preferred – or an indeterminate term. There are certain advantages in opting for a fixed term such as knowing ahead of time when your obligations will expire. Additionally, a fixed-term agreement allows you to renew your contract under the same terms or conditions or to negotiate new ones. Your attorney will work with you in order to determine which option is better suited for your needs.

 Resiliation Clauses

Resiliation clauses are an essential component of the associate agreement and are closely related with the term of the agreement, as they govern the grounds a party could raise in order to resiliate the contract prior to the expiration of the term, or if there is no term, the modalities the parties must respect in order to terminate the contract. Resiliation clauses are extremely useful as they are proactive measures that are inserted into the contract in order protect the parties and avoid potential disputes related to unforeseen circumstances such as a violation of professional conduct or a corporation’s insolvency to name a few.

Restrictive Covenants

Restrictive covenants, such as a non-competition and non-solicitation clauses, are mechanisms by which the interests of the corporation are safeguarded. These covenants allow healthcare professionals (business owner) to limit conduct that would otherwise cause damage to or jeopardize the activities of the clinic following the termination of an associate agreement. While restrictive covenants afford owners protection of their interests, they must be exercised in a reasonable manner.

Non-competition Clause

The non-competition clause must contain, in a clear and concise manner, temporal and geographical restrictions to exercise the activity carried out by your corporation. These restrictions will apply to the associate and are effective upon the expiry of the term or the resiliation of the associate agreement, and essentially prevent the associate from participating, directly or indirectly, in the same field of activity as the beneficiary of the associate agreement. Essentially, the objective is to avoid the associate opening up shop right next-door. It is important to note that the degree of these restrictions will vary from one case to another in view of what is reasonable and necessary to protect the corporation’s interests.

Non-sollicitation Clause

Healthcare professionals spends years building up, not only their clientele, but their ideal team. Therefore, non-solicitation clauses prohibit the associate from soliciting clients as well as personnel upon the expiry or resiliation of the associate agreement.

Why You Should Consult the Medicaloi Team for your Associate Agreement?

Errors and oversights when drafting the terms and conditions of the associate agreement can cause unnecessary conflict. At Medicaloi we are committed to negotiating and drafting personalized associate agreements on behalf of our clients in order to safeguard their interests.

To find out how our team can assit you in building a personalized service agreement, contact us for a complimentary consultation at (438) 805-5515