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Sample Report
Psychiatry Contract — Sample Analysis
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Contract Analysis · Psychiatry
sample-psychiatry-contract.pdf
Moderate Risk
0 = physician-favorable · 100 = extreme risk
Income Snapshot
Four numbers: the total revenue your work generates, what you take home, what your group collects in professional fees, and what the hospital captures. Estimates, not promises. We do not estimate employer cost — if the group wants to argue cost, they can provide their data to you.
Total revenue you generate
Coming soon
Revenue breakdown is rolling out specialty by specialty — live now for emergency medicine and hospital medicine.
Your estimated take-home
$181,160 – $236,155
Mid-range: $203,805
Gross $280,000 – $365,000 minus your share of insurance, retirement, malpractice tail, and tax.
Professional fees collected
Coming soon
Specialty-specific revenue ranges are rolling out — live now for emergency medicine and hospital medicine.
Hospital revenue captured
N/A
Hospital facility-fee math is currently scoped to emergency medicine.
Take-home after estimated federal, payroll, and California state taxes runs $181,000–$236,000 on a gross of $280,000–$365,000 — a gross-to-net ratio near 65%, reflecting California's high state income tax. Dependent health premiums and a supplemental own-occupation disability policy (see Benefits) come out of net beyond this table.
Executive Summary
This contract presents a $200/hour rate at 32 clinical hours per week — roughly $300,800 annualized over a 47-week year — against 2025 national psychiatry total compensation of $258,293 at the P25, $327,430 at the median, and $394,452 at the P75. The effective rate sits near the 47th percentile of the national $/wRVU distribution: at market on rate, below the total-compensation median. Four structural issues silently transfer income and risk onto the physician.
The largest pattern is the no-show economics. The contract pays only on completed encounters with no compensation for no-shows or cancellations. Outpatient psychiatry no-show rates run 15–25% in real practice. At a 20% no-show rate, the physician's effective hourly rate drops from $200 to roughly $160 — a $40 hourly gap that compounds to $54,000 annually before any other consideration. The contract pretends no-shows are a physician productivity problem when they are operationally and structurally an employer scheduling problem.
Telepsychiatry compensation parity is silent. Telepsych now accounts for 40–60% of outpatient psychiatry volume nationally, and the contract neither specifies an in-person vs. telepsych differential nor confirms parity. The 2025 national psychiatry data shows telepsych encounters are billable at the same level as in-person under post-pandemic payer rules, but employers occasionally pay physicians less for telepsych and capture the spread. Lock parity in writing.
Section 5.3 contains an 18-month restrictive covenant with a 15-mile radius measured from any practice location. The dedicated Non-Compete Analysis section of this report assesses that clause under the contract's governing state law.
The productivity bonus uses 30% of net receivables above $400,000 — a metric the employer fully controls. Physician cannot audit collections, payer mix is assigned, and write-offs occur at employer discretion. The structure is a phantom bonus by design.
Key Red Flags
- No-show / cancellation policy missing — at 20% no-show rate, effective hourly drops from $200 to ~$160 (-$54,000/year)
- Telepsych compensation parity not addressed — 40-60% of volume is telepsych and the contract is silent on rate parity
- Productivity bonus uses employer-controlled net-receivables metric with no physician audit right
- Therapy vs. medication-management visit type mix not specified — wRVU exposure differs by 2-3× between visit types
- After-hours and emergency consult coverage uncompensated and undefined
Key Strengths
- Effective rate near the 47th percentile of the 2025 national psychiatry $/wRVU distribution ($78.83 median) — the headline rate is at market
- Employer-funded claims-made malpractice with tail commitment on without-cause separation
- 20 days PTO plus 5 sick days and 6 federal holidays — at the market standard for outpatient psychiatry
Compensation Analysis
HIGHYour $/wRVU vs the market
Your effective rate of $76.77/wRVU sits at the 47th percentile for this specialty. The shaded band is the national middle 50% (P25–P75).
What you earn at each production level
Annual compensation at your contract rate versus the specialty-median rate, across P25 / median / P75 production. The gap is the cost of the rate, and it grows with volume.
Model
Hourly + Net-Receivables Productivity Bonus
Base Rate
$200/hour at 32 clinical hours/week
Hourly Rate vs Market
Against the 2025 national psychiatry benchmarks — $258,293 P25, $327,430 median, $394,452 P75 total compensation — the $300,800 contract gross sits between the P25 and the median, and the effective rate lands near the 47th percentile of the national $/wRVU distribution. The structural issues are around no-shows, bonus design, and call coverage rather than the headline rate.
Annualized: $300,800 annualized at the contracted 32 clinical hours per week over a 47-week working year (excludes PTO and holidays)
Shift differentials: No differential for after-hours, weekend, or telephonic on-call work
wRVU Rate vs Benchmark
If restructured to a wRVU basis, the 2025 national psychiatry $/wRVU runs $62.93 at the P25, $78.83 at the median, and $111.92 at the P75, on annual production of 2,575 (P25) to 5,620 (P75) wRVUs. The current hourly structure obscures this rate entirely — a 50-minute therapy session and a 15-minute medication-management visit are paid identically by the hour, despite generating very different wRVU values.
Sign-on Bonus
$25,000
2-year linear vest with full repayment if separation in year 1; pro-rata months 13–24
CME Coverage
$2,500/year allowance, 4 CME days
Productivity Bonus
30% of net receivables above $400,000/year, paid quarterly in arrears
Net Take-Home
Gross (P25 – P75)
$280,000 – $365,000
Mid: $315,000
Classification
W-2
Drives the expense math
Estimated take-home
$181,160 – $236,155
Mid: $203,805
| Expense line | Annual range | Note |
|---|---|---|
| Estimated taxes (federal + payroll + state) | $98,840 – $128,845 | W-2: federal + employee payroll + CA (35% effective). |
Assumptions
- Married filing jointly with one dependent on physician's health plan
- No additional W-2 income from spouse
- No 1099 side income or moonlighting
- Pre-tax retirement contributions excluded from the take-home calculation
- Taxes estimated at a combined 35% effective rate (federal + employee payroll + California state); figures would differ in lower-tax states
Revenue Breakdown (rolling out)
Revenue breakdown is rolling out specialty by specialty. Emergency medicine is live first; other specialties follow as we tune collected-revenue ranges per specialty and practice setting.
Missing Protections
No-show compensation policy
Outpatient psychiatry runs a 15–25% no-show rate in real practice. Without a contractual no-show / late-cancellation policy, the physician absorbs that risk at zero pay. At a 20% no-show rate, the effective hourly rate drops from $200 to $160 — a 20% pay cut that does not appear anywhere in the contract.
"Add a no-show policy: patients who fail to attend a scheduled appointment without 24-hour notice are billed a $75 no-show fee, and the physician is paid 50% of the contracted hourly rate for the scheduled slot, OR the practice guarantees a minimum 80% schedule fill rate with the physician paid for unbilled time at the contracted rate."
Telepsychiatry compensation parity
Telepsych is 40–60% of outpatient psychiatry volume post-2020. Billing parity rules under federal and California payer policy require equal payment for telepsych and in-person encounters. The contract is silent — which creates an opening for the employer to pay less for telepsych and capture the difference.
"Add a clause: telepsychiatry encounters are compensated at the same hourly rate and bonus formula as in-person encounters. Physician retains the right to determine in-person vs. telepsych modality based on clinical indication."
Therapy vs. medication-management visit mix specification
A psychiatrist doing 50-minute therapy generates very different wRVU exposure than one doing 20-minute medication-management visits. The current hourly structure pays both equally, which is fine — but the contract should specify the expected visit-type mix (e.g., 70% medication-management, 30% therapy or evaluation) so the practice cannot unilaterally shift the mix toward higher-volume / lower-acuity visits.
"Add a clause specifying the expected visit-type distribution: 60% medication management, 25% intake / evaluation, 15% therapy or extended visits. Any material deviation requires written physician agreement."
Audit right on net-receivables bonus calculation
The productivity bonus is 30% of net receivables above $400,000. The physician has no contractual right to inspect the receivables ledger, no transparency on write-offs, and no audit mechanism. The employer can show a $399,000 receivables number every quarter and pay no bonus.
"Add a quarterly transparency clause: practice shall provide the physician with a complete encounter-level receivables ledger, including payments, adjustments, and write-offs, within 30 days of each quarter close. Physician has the right to engage an independent accountant to audit the ledger annually at physician's expense."
Employer-funded malpractice tail coverage
The contract provides employer-paid tail on without-cause separation but is silent on tail in voluntary resignation. Psychiatry tail premiums in California typically run $15,000–$30,000.
"Extend tail funding to all separation events except for-cause termination involving moral turpitude or substance abuse not in treatment."
Clause Analysis
""Physician shall be compensated at the hourly rate set forth in Section 3.1 for each clinical hour worked, defined as time spent in direct patient encounter or documentation of completed encounters. Time spent in scheduled but uncompleted encounters (including patient no-shows, cancellations less than 24 hours prior, and rescheduling) is not compensable hours.""
The structure pays only on completed encounters. Real outpatient psychiatry runs 15–25% no-show rates. At a 20% no-show rate, the physician is unpaid for one out of every five scheduled hours. The economic effect is a 20% pay cut versus the stated hourly rate, and the financial responsibility for filling no-shows sits entirely on the physician (who does not control scheduling or patient communications).
Negotiate one of three structures: (a) flat hourly rate based on scheduled hours, with employer absorbing no-show risk; (b) 50% pay for no-show slots up to a defined daily cap; (c) practice guarantees an 80% fill rate, paying full rate for any shortfall below that threshold. Option (c) aligns incentives correctly — the practice has control over scheduling and patient retention.
""Physician shall receive a sign-on bonus of twenty-five thousand dollars ($25,000), payable within thirty (30) days of the Start Date. If Physician's employment terminates for any reason within twelve (12) months of the Start Date, Physician shall repay the bonus in full; if employment terminates in months thirteen (13) through twenty-four (24), Physician shall repay a pro-rata portion.""
The repayment trigger is "terminates for any reason" — which includes employer-initiated without-cause termination. If the practice terminates the physician without cause in month 10, the physician owes the full $25,000 back despite losing the position involuntarily. The pro-rata schedule in year two is market-standard; the any-reason trigger in year one is not.
Limit repayment to voluntary resignation or for-cause termination. Add: "No repayment obligation arises if employment is terminated by Practice without cause, or by Physician for Practice's uncured material breach." This is a low-friction ask that most employers accept without resistance.
""Physician shall earn a productivity bonus equal to thirty percent (30%) of Net Receivables attributable to Physician's encounters in excess of four hundred thousand dollars ($400,000) per calendar year. Net Receivables shall mean gross collections less adjustments, write-offs, and bad-debt allowances as determined by Practice in its reasonable discretion.""
The phrase "as determined by Practice in its reasonable discretion" is the single highest-impact phrase in this contract. The physician has no defined audit right, no transparency on write-off classification, and no remedy if the practice writes down receivables aggressively to keep the bonus pool below $400,000. The reasonable-discretion language creates near-total employer control over the bonus formula.
Demand audit transparency in writing. At minimum: quarterly encounter-level receivables reports, payer-mix disclosure, and the right to engage an independent accountant to review the ledger annually. Better: replace net-receivables with a wRVU-based bonus tied to a percentile-anchored threshold — wRVU is harder to manipulate than receivables.
""Physician shall be available for telephonic consultation with established patients on a 1:4 weekend rotation. After-hours and weekend consults are considered part of the Physician's general professional obligation and are not separately compensated.""
Telephonic after-hours psych call is among the highest-acuity unpaid work in outpatient psychiatry — suicidal patient calls, acute medication-management decisions, hospital decision support. The contract assigns 1:4 weekend rotation with no compensation. Market structures pay $250–$500/weekend for on-call psychiatry, or per-call rates of $50–$150 for telephonic encounters.
Negotiate $400/weekend stipend for on-call coverage, OR per-call rate of $100 for any documented telephonic encounter, OR exclude the physician from on-call rotation in exchange for a base rate increase.
""Practice retains the right to modify Physician's schedule, including session length, visit-type allocation, location of practice, and total clinical hours, upon thirty (30) days written notice.""
30 days notice for material schedule change is short. Psychiatric patient panels are continuity-of-care relationships built over months and years; reshuffling visit-type mix or shifting toward shorter medication-management visits affects clinical quality and the physician's effective income. The phrase "session length" is particularly aggressive — session length affects every visit's wRVU value.
Negotiate to 90 days notice for material schedule changes, defined as: change to total clinical hours of more than 10%, change to visit-type mix of more than 15 percentage points, change to in-person vs. telepsych ratio of more than 20 percentage points, or change to primary practice location.
""Either party may terminate this Agreement without cause upon sixty (60) days written notice.""
60 days is at the lower end of market for outpatient psychiatry. Practical patient transition for a panel of 100–200 established patients realistically requires 90–120 days to hand off care, manage controlled-substance prescriptions, and transition complex therapy patients.
Negotiate to 90 days for the physician's benefit (or retain 60 days mutual with a defined patient-transition period during which physician retains practice access).
Non-Compete
LOWExists
Yes
Radius
15 miles
Duration
18 months
Governing State
California
Enforceability
Unenforceable by Law
Landmark cases: Edwards v. Arthur Andersen LLP (2008, Cal. Supreme Court (44 Cal.4th 937)): Rejected any judicial 'narrow restraint' exception to § 16600; employment non-competes are void unless a statutory exception applies — now codified by AB 1076's § 16600(b).
Under California law, physician non-competes are void (Void — total ban (employment)). This clause is most likely unenforceable against you — a strong position. Governing law: Cal. Bus. & Prof. Code § 16600 (with §§ 16600.1, 16600.5; sale/partnership carve-outs at §§ 16601, 16602; physician PE/MSO reinforcement at SB 351 / Health & Safety Code, eff. 1/1/2026).
Malpractice Insurance
MODERATEType
claims-made
Coverage Limits
$1,000,000 per occurrence / $3,000,000 aggregate
Tail Coverage
Employer-funded on without-cause termination by employer. Silent on voluntary resignation and on for-cause termination.
Tail Cost Estimate
California outpatient psychiatry tail typically runs $15,000–$30,000 under claims-made policies. Lower than procedural specialties but still material at job transition.
Two changes: (1) Extend tail funding to voluntary resignation with 60 days notice (currently only on without-cause employer termination). (2) Add consent-to-settle language with reasonableness standard.
Termination Provisions
MODERATEWithout-Cause Notice
60 days mutual. At the lower end of market for outpatient psychiatry given panel-transition complexity.
With-Cause Provisions
For-cause includes: (a) loss of California medical license; (b) loss of DEA registration; (c) impairment under DSM-5 substance use criteria; (d) felony conviction; (e) material breach uncured after 30 days notice. The impairment clause uses "as determined by Practice in good faith" language, which is overly subjective.
Physician Rights
Limited. Physician may terminate for: (a) Practice material breach uncured after 30 days notice; (b) sale, merger, or change of control. No express right to terminate for substantial schedule modification or material reduction in compensation structure.
Extend without-cause notice to 90 days. Narrow the impairment clause to require either: (a) a documented Medical Board action, or (b) a peer-reviewed determination by a board-certified addictionologist. Add physician termination rights for substantial schedule modification (>15% change to total hours or >20% change to visit-type mix) and any material reduction in compensation.
Benefits & Leave
MODERATEHealth Insurance
Group health plan effective first day of employment. Employer pays 75% of premium for physician; physician pays 100% of dependent premium. Below market — typical CA private practice psychiatry packages cover 85–95% of physician and 50–70% of dependents.
CME
$2,500/year allowance and 4 CME days. Below market — professional-society guidance for psychiatry recommends $3,500–$5,000 annually and 5–7 CME days.
PTO
20 days PTO + 5 sick days + 6 federal holidays. Standard for outpatient psychiatry.
Retirement
401(k) with 3% employer match after 1 year of service. Below market — typical CA private practice psych offers 4–6% match.
Disability
Group long-term disability covering 60% of base salary, after 90-day elimination period. Own-occupation specialty-specific disability not included.
Malpractice
Claims-made, $1M / $3M, employer-paid during active employment. Tail funded only on without-cause employer termination (see Malpractice section).
Negotiation Approach
Lead with the no-show policy. It is the largest concrete dollar impact ($40,000–$60,000/year), and the framing is operational rather than compensatory ("we should align on no-show economics"). After the no-show, stack telepsych parity, audit right on the bonus formula, and on-call differential. The Section 5.3 restrictive covenant is assessed in the dedicated Non-Compete Analysis section of this report — fold its recommendation into the same negotiation round.
Opening Move
Email the practice administrator or owner: "I want to flag a few items in the contract that touch on how we share operational risk. Specifically, no-show economics, telepsychiatry parity, and how the productivity bonus is calculated. I have specific market data on each. Can we set 30 minutes to walk through?" The framing of "shared operational risk" — not "I want more money" — is essential in private practice negotiations where the employer is also a clinician.
Key Principles
- In private practice psychiatry, the employer is typically a clinician — frame asks operationally, not adversarially.
- Lead with risk-sharing language (no-show, audit right) before compensation language.
- Anchor every ask to a 2025 benchmark percentile — the data is the leverage, not sentiment.
- Get audit right in writing. "We'll be transparent" is not enforceable. The clause must specify what data, in what format, on what cadence.
Sequencing
- 1Email opening with three framing topics
- 230-min call: walk through no-show, telepsych, bonus calculation, on-call
- 3Receive counter in writing within 5 business days
- 4One round of refinement; lock audit right and no-show terms
- 5Final redlined contract for execution
Negotiation Priorities
Financial Impact
At a typical 20% no-show rate, 50% pay for missed slots recovers roughly $30,000/year — $90,000 over three years. The 80% fill-rate guarantee recovers $40,000–$60,000/year depending on the actual no-show pattern — $120,000–$180,000 over three years.
Current Terms
No compensation for no-shows or <24-hour cancellations
The Ask
50% pay for no-show slots up to 4 slots/week, OR 80% schedule fill rate guarantee with employer paying base rate for any shortfall
Fallback
An 80% schedule fill-rate guarantee with the employer paying base rate for any shortfall — roughly $40,000–$60,000/year of protection at typical no-show patterns.
Walk-Away Point
If employer refuses any no-show protection, the effective hourly rate is materially below the stated $200/hour. Contract is not signable without this protection or a base-rate increase to $235–$250/hour to compensate.
Say this
“At a typical 20% no-show rate, my effective hourly drops well below the stated $200. I'd like 50% pay for no-show slots, capped at four a week — or an 80% fill-rate guarantee with the practice covering the shortfall. The schedule is built by the practice; the no-show risk should not sit entirely on me.”
Financial Impact
Defensive — locks in current parity rules. If telepsych pay slipped 10% on the 40–60% of volume delivered virtually, the exposure runs roughly $12,000–$18,000/year — $36,000–$54,000 over three years. The silence in the current contract would let the employer cut the physician's telepsych pay without breach.
Current Terms
Silent on telepsych vs in-person rate parity
The Ask
Explicit clause: telepsych encounters compensated at the same hourly rate and bonus formula as in-person encounters
Fallback
A side letter confirming current parity practice, with any future telepsych rate change requiring mutual written agreement.
Walk-Away Point
Non-negotiable. Telepsych is 40–60% of outpatient psychiatry volume. The clause is symbolic to negotiate but materially important to enforce.
Say this
“Telepsych is 40 to 60% of outpatient volume and this contract is silent on it. I'd like one sentence added: telepsych encounters are compensated at the same hourly rate and bonus formula as in-person. If parity is already the practice, writing it down costs nothing.”
Financial Impact
Defensive — the bonus pool is currently invisible to the physician, so the bonus the contract describes is worth $0 without verification. The fallback base increase of $15,000–$25,000/year is worth $45,000–$75,000 over three years.
Current Terms
Practice determines write-offs "in its reasonable discretion" with no physician audit right
The Ask
Quarterly encounter-level receivables report, payer-mix transparency, annual right to engage independent accountant at physician's expense
Fallback
Drop the receivables bonus entirely in exchange for a $15,000–$25,000 base increase — a phantom bonus is worth less than visible salary.
Walk-Away Point
Without audit right, the 30%-of-receivables bonus is a phantom. Better to negotiate it out of the contract entirely in exchange for a $15,000–$25,000 base salary increase.
Say this
“The bonus is 30% of net receivables, but write-offs are at the practice's sole discretion and I have no visibility into the pool. I'd like a quarterly encounter-level receivables report and an annual audit right at my own expense. I'm not asking you to change the formula — only to let me verify it.”
Financial Impact
A $400/weekend stipend at the 1:4 rotation (13 weekends/year) pays $5,200/year — $15,600 over three years. A $100 per-call rate at typical telephonic volume runs $5,000–$7,500/year — $15,000–$22,500 over three years.
Current Terms
1:4 weekend telephonic on-call uncompensated
The Ask
$400/weekend stipend, OR per-call rate of $100, OR exemption from rotation
Fallback
A per-call rate of $100 per documented telephonic encounter ($5,000–$7,500/year at typical volume), or exemption from the rotation.
Walk-Away Point
After-hours telephonic psych is high-liability work. Uncompensated coverage is structurally inappropriate; if employer refuses any compensation, the base rate must increase materially to compensate.
Say this
“The 1-in-4 weekend telephonic call is uncompensated, and after-hours psych calls are high-liability decisions. I'd like a $400 weekend stipend — about $5,200 a year at this rotation. Compensated call is the norm for employed psychiatry; uncompensated call is the outlier.”
Generate Counter-Proposal
What this section does
- Generates a full counter-proposal letter in your chosen tone (warm or firm), addressed to the employer, citing specific specialty benchmarks and your negotiation priorities.
- Lets you select which priorities to include, and supports both new-offer and renegotiation letter types with an optional contract start date.
- Output is editable, copyable, and prints to PDF alongside the report — ready to send, or revise it first.
Unlimited Q&A
Example question
Unlimited Q&A — ask follow-up questions about your analysis
Ask about any clause, negotiate strategy, what specific language to request, or what a term means in practice. Answers are grounded in your actual contract text and benchmarks for your specialty. Yours forever — come back any time.
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