Ultimate Guide to OB GYN Residency Physician Contract Negotiation

Why Physician Contract Negotiation Matters in OB GYN

For many obstetrics and gynecology residents, the transition from trainee to attending is both exciting and intimidating. You’ve spent years mastering high‑stakes clinical situations—managing shoulder dystocias, postpartum hemorrhage, and complex gynecologic surgeries. Yet one of the most financially consequential moments of your career will happen not in the OR or on L&D, but at a desk: negotiating your first physician employment contract.

In OB GYN, this is especially critical:

• You often provide high‑liability care (e.g., deliveries, surgical procedures).
• Your schedule is inherently demanding (nights, weekends, call, emergencies).
• Compensation models vary widely (academic vs private, employed vs partnership, hospital vs group).
• Malpractice risk and tail coverage can dramatically impact your long‑term finances.

A thoughtful, well‑negotiated contract can:

• Protect you from unreasonable call, RVU, or productivity expectations.
• Ensure fair compensation and benefits that reflect your value and risk.
• Clarify expectations about OR time, clinic support, and work–life balance.
• Avoid restrictive clauses that can limit future job flexibility and earning potential.

This guide walks through the major components of OB GYN employment contracts, how to approach physician contract negotiation, and practical strategies for securing terms that align with your clinical goals, lifestyle, and long‑term career plans.

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Understanding Common OB GYN Employment Structures

Before you negotiate, you need to understand what kind of job you’re negotiating. Each employment structure has its own norms for salary, benefits, and leverage.

1. Academic OB GYN Positions

Typical features:

• Base salary with minimal or no productivity incentive, especially early on.
• Clear expectations for clinical time vs teaching vs research.
• Lower attending salary negotiation flexibility, but more predictable structure.
• Stronger emphasis on benefits (retirement, CME, tuition discounts) and job stability.

Pros:

• Upfront clarity around call schedules and teaching commitments.
• Good for residents who thrive in teaching and research environments.
• Often more structured maternity/paternity leave and wellness resources.

Challenges:

• Lower base salary compared with private practice or hospital-employed roles.
• Less room for aggressive negotiation on salary, more on duties and non-clinical FTE.

Negotiation focus in academics:

• Protected time for teaching, research, or administrative duties.
• Clear expectations and written FTE allocations (e.g., 0.7 clinical, 0.2 teaching, 0.1 research).
• Call expectations, especially for night float, L&D, and gynecologic surgery.
• Pathway to promotion and academic rank.

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2. Hospital-Employed OB GYN

Typical features:

• You are employed directly by the hospital or health system.
• Often a guaranteed base for 1–3 years, then transition to RVU or hybrid comp.
• Hospital often provides malpractice (including tail or occurrence policies).

Pros:

• Reliable paycheck, often competitive in many markets.
• Shared call with larger group; hospital covers overhead.
• Systems often have standardized benefits and processes.

Challenges:

• Less autonomy over schedule, ancillary staff, or practice style.
• Productivity pressure once guarantee period ends.
• Non-compete clauses may be strict in systems with wide regional coverage.

Negotiation focus:

• Clear, attainable RVU targets and how they were calculated.
• Call burden (gyne, L&D, backup, weekend/nights) and call compensation.
• Malpractice coverage type and who pays tail if you leave.
• OR block time, clinic support staffing (MAs, RNs, midwives, APPs).

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3. Private Practice OB GYN (Group or Single-Specialty)

Typical features:

• Employed associate track with potential for partnership.
• Compensation often lower at first, with higher ceiling after buy‑in.
• More variation in benefits, call structure, and practice culture.

Pros:

• More control over clinical style and schedule once established.
• Often higher long‑term earning potential than academic or hospital-employed roles.
• Direct say in business decisions after partnership.

Challenges:

• Very practice‑specific; terms can be excellent or poor.
• Partnership track may be vague or not guaranteed.
• Need to understand practice finances, payer mix, overhead, and buy‑in mechanics.

Negotiation focus:

• Timeline and criteria for partnership (not just “typically 2–3 years”).
• How buy‑in is determined (fixed amount vs valuation vs equity in ancillaries).
• Transparency around group finances and compensation distribution formulas.
• Call sharing and expectations for new vs senior partners.

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Key Components of an OB GYN Physician Employment Contract

During employment contract review, focus on how each clause will play out in real life. Below are the major sections and what they mean for you as an OB GYN.

1. Compensation Structure

Most OB GYN attending offers are one of the following:

A. Straight Salary

• Single annual number. Example: $275,000 base, no bonus.
• More common in academic or lower-volume roles (e.g., hospitalists, some rural jobs).

Questions to ask:

• How often is compensation reviewed and adjusted?
• Are there defined cost-of-living or performance-based increases?
• Are there separate stipends for leadership roles, medical directorship, or extra call?

B. Salary + Productivity (Common in OB GYN)

• Base salary plus incentive based on:
  • RVUs (work-relative value units)
  • Net collections
  • Deliveries, surgeries, or encounters
• Example: $260,000 base + $45 per wRVU over 5,000 wRVUs per year.

Critical details to clarify:

• What is the expected RVU or volume target?
• Is the target actually achievable given:
  • Existing patient base
  • OR block availability
  • Number of providers in the group
  • Competing groups in the area
• How are hospital-based duties (L&D coverage, teaching, committee work) credited?

C. Productivity-Only (Risky for New Graduates)

• Rarely recommended for your first job unless:
  • There is a large established patient base you will inherit.
  • The group is extremely transparent and reputable.
• If offered, insist on a clear minimum income guarantee in writing.

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2. Sign-On Bonus, Relocation, and Loan Repayment

These are often worth tens of thousands of dollars—and are among the easiest to negotiate.

Sign-On Bonus:

• Typical range for OB GYN: $10,000–$75,000+ depending on geography and need.
• Usually tied to a work commitment (e.g., 2–3 years), forgiven over time.

Key questions:

• What is the repayment obligation if you leave early?
• Is it prorated (ideal) or all-or-nothing (less favorable)?

Relocation Assistance:

• Often $5,000–$15,000; sometimes reimbursed with receipts.
• Ask if it can be structured as a lump sum.

Loan Repayment:

• Health systems or rural practices might offer $20,000–$100,000 over several years.
• Clarify:
  • Who pays (employer vs third-party program)?
  • Tax treatment and vesting schedule.
  • What happens if you leave before the full term?

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3. Call, Workload, and Schedule Expectations

In OB GYN, your time is as valuable as your salary. Call burden and schedule flexibility are core negotiation points.

Call Details to Put in Writing:

• How often will you take:
  • Primary call for L&D?
  • Gyn call?
  • Backup call?
• Is call in-house or at-home, and how often?
• How are holidays, weekends, and nights distributed between partners vs new associates?

Example language to look for or propose:

• “Physician will participate in the call rotation no more frequently than 1 in 5 weekdays and 1 in 5 weekends.”
• “Additional call beyond the standard rotation will be compensated at $X per 24-hour period.”

Clinic and OR Time:

• Number of clinic sessions per week.
• OR block time (how many blocks, guaranteed or not).
• OB time vs GYN time balance (especially important if you want more surgery or more OB).

Practical tip:
Ask for historical data:

• How many deliveries did each provider do last year?
• Average clinic volume per day?
• Typical number of OR cases per week?

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4. Benefits: Health, Retirement, CME, and Leave

These “non-salary” elements can significantly affect your overall package.

Health and Disability Insurance:

• What portion of premiums does the employer cover?
• Is short-term and long-term disability included—and when do they kick in?
  • Critical given pregnancy risk and surgical practice.

Retirement:

• 401(k), 403(b), or pension contributions.
• Match percentage and vesting period.
• If the group offers profit-sharing, ask how it’s calculated.

CME and Professional Expenses:

• Annual CME allowance (common: $2,000–$5,000).
• Paid CME days (3–5 days/year typical).
• Coverage of:
  • Licensing fees
  • DEA
  • ABOG maintenance of certification
  • ACOG dues

Vacation and Parental Leave:

• Total paid time off (PTO) and how it’s divided (vacation, sick, CME).
• OB GYN schedules are intense; 4–6 weeks combined PTO is typical, more is ideal.
• Maternity/paternity leave:
  • Is leave paid, partially paid, or unpaid?
  • Does disability insurance coordinate with leave?
  • How is call/clinic coverage arranged during pregnancy and postpartum?

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5. Malpractice Insurance and Tail Coverage

For OB GYN, malpractice coverage is one of the most critical contract elements, both medically and financially.

Types of Malpractice:

• Claims-made: Covers claims only if both the incident and the claim occur while the policy is active.
  • Requires tail coverage when you leave (covers claims made after you leave for prior incidents).
• Occurrence: Covers incidents that occur during the policy period, regardless of when the claim is filed.
  • More expensive but no tail required for you.

Key questions:

• What type of policy is provided?
• Who pays for the premium?
• Who pays for tail coverage—and how much will it likely cost?

In OB GYN, tail coverage can be extremely expensive—often 1.5–2.5 times the annual premium, frequently in the $60,000–$200,000 range depending on state and practice.

Negotiation strategies:

• Push for employer-paid tail coverage, especially in high-liability states.
• If the employer insists you pay:
  • Ask for a vesting schedule (e.g., employer pays 25% per year of service).
  • Request a severance/tail forgiveness clause if they terminate you without cause.
  • Try to convert some sign‑on bonus dollars into a tail guarantee instead.

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Restrictive Covenants, Termination, and Partnership Tracks

Physician contract negotiation is not just about what you earn; it’s also about your options if the job isn’t what you expected.

1. Non-Compete and Non-Solicitation Clauses

Non-Compete (Restrictive Covenant):

• Limits where and how you can practice after leaving.
• Typical in OB GYN contracts, though enforceability varies by state and is evolving legally.

Key variables:

• Geographic radius (e.g., 10–30 miles).
• Duration (e.g., 1–2 years).
• Scope (OB, GYN, or any women’s health practice).
• Whether it applies only to locations where you actually worked.

Negotiation goals:

• Narrow the radius (e.g., 10 miles instead of 25, or “X miles from primary practice site only”).
• Limit the duration to 12 months if possible.
• Limit the scope to OB GYN rather than “all practice of medicine.”
• Exclude termination without cause by the employer from triggering the non-compete.

Non-Solicitation:

• Prevents you from “taking” staff or patients if you leave.
• More enforceable, often narrower than non-competes.
• Usually more reasonable and less of a negotiation target, but still review carefully.

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2. Term and Termination

Your contract should spell out how the relationship can end:

• Term: Initial contract length (often 1–3 years).
• Automatic renewal: Does it renew unless either party gives notice?

Termination Types:

1. With cause:

   • For specific reasons like loss of license, hospital privileges, or criminal conduct.
   • These should be clearly defined and not overly broad.

2. Without cause:

   • Either party can terminate for any reason with adequate notice.
   • Typical notice: 60–180 days.

Why this matters:

• If things aren’t working—volume too low, culture mismatch, unsafe environment—you need a clear exit.
• Shorter notice (e.g., 60–90 days) gives you more flexibility, but employers may push for longer to manage continuity of care.

Check alignment with other clauses:

• Does tail coverage change if they terminate you vs you resign?
• Does the non-compete apply equally regardless of who initiates termination?
• Are bonuses or RVU payouts prorated and paid if you leave mid-year?

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3. Partnership Tracks in OB GYN Private Practice

If you’re joining a private group with the possibility of partnership, you need clarity right up front. “You’ll probably be a partner in 2–3 years” is not sufficient.

Ask for specifics in writing:

• Exact timeline (e.g., “Eligible for partnership consideration after 24 months”).

• Objective criteria for partnership:

  • RVUs or production thresholds.
  • Citizenship expectations (committee involvement, call participation).
  • Professionalism measures.

• Buy-in structure:

  • Fixed amount vs formula-based.
  • What assets are included: accounts receivable, equipment, real estate, ancillaries (surgery center, imaging, labs)?
  • Are you buying into goodwill, and if so, how is that valued?

• Post-partnership compensation:

  • Equal share model vs productivity-weighted distribution.
  • How overhead is divided.

Red flags:

• Vague promises like “everyone here becomes a partner eventually” without documented criteria.
• No visibility into practice financials, payer mix, or overhead.
• Long partnership tracks (>4 years) without interim transparency.

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Practical Strategies for Effective OB GYN Contract Negotiation

You do not need to be a lawyer or business expert to negotiate confidently, but you do need structure and preparation.

1. Benchmark Your Offer

Use multiple sources to understand the current market for OB GYN:

• Specialty societies and surveys (e.g., ACOG, MGMA, AMGA, Doximity, Medscape).
• Talk to recent graduates from your program about their offers.
• Consider regional differences—Midwest and rural South often pay more than East/West Coast, but cost of living and lifestyle differ.

When comparing offers, account for:

• Base salary plus likely productivity bonus.
• Benefits, retirement, and employer-paid malpractice/tail.
• Call burden and schedule (1:3 call with 260K is not “better” than 1:6 with 240K in many cases).
• Non-compete limitations and long-term flexibility.

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2. Decide Your Priorities Before You Start Negotiating

You will have more leverage and clarity if you know what matters most to you:

• Higher base salary vs signing bonus vs loan repayment.
• Lighter call vs more vacation vs more OR block time.
• Academic duties vs pure clinical practice.
• Geographic preference vs compensation level.

Make a personal “top 5” list. For example:

1. Employer-paid tail coverage.
2. Call no worse than 1:5 weekends.
3. Protected time for minimally invasive GYN surgery.
4. Non-compete radius ≤ 10 miles.
5. Total compensation ≥ regional median for OB GYN.

Use this list to guide where you push hardest and where you’re willing to compromise.

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3. How to Ask for Changes Professionally

Approach contract negotiation as a collaborative problem-solving process, not a confrontation.

Practical language you can use:

• “Thank you for the offer. I’m very excited about the possibility of joining your team. I’d like to discuss a few points in the agreement to ensure long-term fit for both of us.”
• “Given the call burden and malpractice risk in OB GYN, would you be open to discussing employer-paid tail coverage or a vesting schedule?”
• “Based on current market data for OB GYN in this region, would you consider increasing the base salary from $260,000 to $285,000, or alternatively increasing the sign-on bonus?”

Negotiation tips:

• Group your requests into a small, prioritized list (3–6 items), not 25 minor edits.
• Use data (market surveys, regional comparisons) rather than emotion.
• Be prepared to explain why a term is important (e.g., “I have significant educational debt, so loan repayment is a critical factor for me.”).
• Get all agreed changes in writing in the final contract or an official addendum.

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4. When to Use a Physician Contract Review Attorney

For a high-stakes specialty like OB GYN, especially your first attending job, a formal employment contract review by a knowledgeable attorney is strongly recommended.

Look for:

• An attorney who routinely reviews physician contracts, preferably with experience in OB GYN or surgical specialties.
• Someone licensed in the state where you’ll practice (state law matters for non-competes and enforcement).
• Transparent fee structure (flat-fee reviews are common and predictable).

What they can help with:

• Flagging overly broad restrictive covenants.
• Interpreting complex compensation formulas.
• Identifying hidden liabilities (e.g., tail costs, clawbacks on bonuses).
• Suggesting alternative language for problematic clauses.

You still drive the strategy—what you care about most—but a skilled attorney gives you the language and legal nuance to negotiate from a position of strength.

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FAQs: OB GYN Physician Contract Negotiation and Employment

1. How much room is there to negotiate an OB GYN residency-to-attending contract?

It depends on the setting and market, but there is almost always room for some negotiation. Academic centers may have less flexibility on base pay but more on protected time, titles, or responsibilities. Hospital-employed and private practice positions usually have more room on:

• Sign-on bonus and relocation.
• Call structure and compensation.
• Tail coverage or vesting.
• Non-compete scope.

If a group says, “Nothing is negotiable,” that itself can be a data point about their culture and how they value physicians.

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2. What is a fair starting salary for an OB GYN attending?

Fair compensation varies by region, practice type, and call burden. As of recent data:

• Academic OB GYN base salaries are often lower but with strong benefits.
• Community and hospital-employed positions are typically mid-range with productivity upside.
• Private practice and partnership track roles may start modestly but can exceed other settings after buy-in.

Use multiple sources (MGMA, ACOG, Doximity, local colleagues) and always interpret numbers in the context of:

• Call burden.
• Non-clinical time.
• Benefits (especially malpractice and tail).
• Cost of living.

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3. Should I ever accept a contract where I pay my own tail coverage as an OB GYN?

Many OB GYNs do work under contracts where they are responsible for tail, but you need to fully understand the cost and risk. It can be workable if:

• There is a clear vesting or cost-sharing structure (e.g., employer pays 25% of tail per year of service).
• The compensation is meaningfully higher to offset the risk.
• The practice is stable and you realistically see yourself staying for several years.

If a job is otherwise average or below average and requires you to shoulder full tail in a high-liability specialty, it may not be a good long-term fit.

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4. When is the right time in residency to start thinking about OB GYN job contracts?

Most OB GYN residents start applying and interviewing in PGY-3 to early PGY-4, depending on fellowship plans and regional competition:

• Start exploring practice types and locations late PGY‑2 or early PGY‑3.
• Begin serious job search and interviews in PGY‑3.
• Expect contract offers to follow interviews and site visits.
• Plan for at least one round of contract review and negotiation before signing.

Thinking early about your priorities—academic vs community, OB‑heavy vs GYN‑surgical, urban vs rural—will make contract negotiation more focused and effective when offers arrive.

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Thoughtful physician contract negotiation in obstetrics and gynecology is less about playing hardball and more about ensuring your contract accurately reflects your value, your risk, and your long-term goals. With clear priorities, good market data, and expert employment contract review when needed, you can step into your first attending role with confidence—both clinically and contractually.