Published in the September 2007 issue of Today’s Hospitalist
If you’re a hospitalist looking for a job, you probably know that the superheated job market has pushed starting salaries for hospitalists to new highs. What you may not realize, however, is that there are plenty of other perks that may be out there waiting for you.
A good example is the sign-on bonus. While this is not a particularly new tool to recruit physicians, it has become almost pervasive as recruiters compete with one another for a limited pool of physicians. And in an era of increasing one-upmanship, some recruiters are paying sign-on bonuses of up to $40,000 to attract well-qualified hospitalists.
The perks recruiters are using vary tremendously and depend on the geographic area you’re looking in, the type of organization you’re interviewing with “a hospital or independent group “and how quickly a hospitalist is needed. But the trend is clear: Recruiters are offering more “and more lucrative “incentives to get physicians’ attention.
Related article: Hospitalist physician pay is rising.
Here’s a look at the strategies that recruiters are using to attract hospitalists, and what they mean for individual physicians searching for a job.
When it comes to sign-on bonuses, most recruiters agree that these have not only become almost mandatory, but that the dollar amounts physicians are receiving are on the rise.
Ryan Anholt, executive vice president of Dallas-based Delta Physician Placement, says that the average bonus that hospitals and groups he works with pay is about $18,000. Some of his clients in the Midwest are offering a salary of $215,000 with a $40,000 sign-on bonus.
You won’t find those numbers in every market, however. In Boston, where Rebecca Woods, CPC, is regional vice president for physician recruitment and retention with Vanguard Health Systems, sign-on bonuses range between $5,000 and $7,000.
According to Mr. Anholt, hospitalists are receiving bigger sign-on bonuses than many other hospital-based physicians, including anesthesiologists and ED physicians. “When it comes to other hospital-based physicians other than radiologists,” Mr. Anholt says, “sign-on bonuses for hospitalists are higher.”
Unlike some of the other incentives used to recruit physicians, the mechanics of sign-on bonuses are relatively straightforward. In most instances, sign-on bonuses are considered loans that physicians “pay back” by working in a practice for a pre-defined period of time, typically one or two years. Leave before then, and you’ll be expected to pay back some or all of the bonus.
There is one variable in sign-on bonuses, and that’s when you receive the money. Some groups pay the sign-on bonus as soon as you sign, even if your start date isn’t for another six months. Others pay half on signing and half on your start date; others don’t pay the sign-on bonus until the first paycheck is cut.
Another incentive you may encounter is the income guarantee. While income guarantees are not generally as common as sign-on bonuses “and for some very good reasons “some recruiters say they are becoming more popular.
Historically, hospitals have used income guarantees to attract physicians to a community. The hospital helps physicians set up a practice, and it guarantees their income for a year or two to help them get established.
Income guarantees haven’t been widely used in hospital medicine because so many hospitalists receive a salary. Because they’re not paid solely on their productivity, hospitalists often have little need for an income guarantee.
Hospitals sometimes do offer income guarantees to private hospitalist groups whose physicians work within their walls and are paid based on productivity instead of a salary. Particularly if there is only one hospitalist group in town, a hospital may give the recruiting process a boost by guaranteeing the newcomers’ income.
In addition, there are instances in which hospitalists employed by the hospital may be offered a form of income guarantee.
Andrea Oetjens, RN, president of The Berner Group, a national recruitment firm, says that she has some hospitals giving their employed hospitalists an income guarantee. These hospitalists may receive that guaranteed income for their first year, but they then have the option to move to a different compensation plan, either a salary with productivity incentives or straight productivity.
What do hospitals that offer an income guarantee want in return? Typically, physicians must stay in the community for a certain time frame, usually two to three years.
One of the hospitals Ms. Oetjens works with, for example, is guaranteeing a hospitalist’s income for one year. In return, the physician is expected to stay for three years.
She represents another hospital that is guaranteeing the hospitalist’s salary for two years, but there is no expectation of how long the physician needs to stay.
“The hospital is trying to find the right person who plans to stay in that community,” Ms. Oetjens says. “They make a good offer, and they ask for a commitment in return.”
But for some physicians, being asked to commit for several years can be a deal-breaker.
“Not everyone is willing to sign a guarantee saying they’re going to stay X amount of years,” explains Ms. Oetjens. “What if they don’t like the practice environment, or if their family isn’t happy with the community? Situations change.” She adds that several hospitalists have recently turned down opportunities with income guarantees because of the time commitment.
Some income guarantees have no payback provision, typically because they’re offered by a private group, not a hospital. If you join a private practice where everyone is paid based on their productivity, the group may guarantee your income for a year or two. While a hospital is required by federal law to make sure you “pay back” what is defined as a loan, even if it’s by working in the community for a pre-defined amount of time, a private group can give you the money outright.
According to David Cornett, regional vice president with Cejka Search, a national firm, the hospitalists he works with are much more willing to consider this type of income guarantee precisely because there are no strings attached. “When you start getting into those income guarantees that have a payback requirement and forgiveness,” he says, “physicians get nervous.”
Educational or loan forgiveness programs are another recruitment incentive, although they have been the least popular for hospitalists. There are signs, however, that the use of loan forgiveness may be growing.
Mr. Cornett, for example, says that some form of loan forgiveness is “on the table” for about one-third of his company’s searches. He expects that the growing demand for hospitalists will prompt even more of the clients he represents to consider loan forgiveness.
Take a look at recruitment ads, however, and you won’t see loan forgiveness as a perk. That’s because hospitals typically like to keep this incentive quiet so they can introduce it as a negotiating tool.
“Loan forgiveness is often a bargaining tool that employers may not lead with until they know it’s necessary,” says Mr. Cornett. “Employers have a finite pool of money, so don’t lock yourself into loan forgiveness until you know some of the other details that they are willing to offer, which may be attractive to you.”
Reading between the lines, then, the lesson is this: If you’re interested in loan forgiveness, ask about it “even if the hospital you’re interviewing with doesn’t mention it first.
Also keep in mind that loan forgiveness plans typically function much like sign-on bonuses and income guarantees. The money is typically considered a “loan” that must be paid back with service.
Despite the sometimes serious commitment times required by loan forgiveness, some recruiters say they are seeing a slight uptick in the number of hospitalist jobs that are offering it. “I think it’s getting more popular,” Ms. Oetjens explains. “With the costs of education, many of these physicians need some help.”
Generosity varies with size and location
With so many variations on recruiting incentives, it can be hard to keep track of who’s offering what. But recruiters say there are some guidelines about what hospitalists can expect in terms of signing incentives.
For one, you can expect the most generous sign-on bonuses from smaller hospitals and those in rural areas. The laws of supply and demand make it more difficult for these hospitals to attract physicians, so they’re upping the ante in terms of dollar amounts.
If you’re looking for a job with a large hospitalist company, on the other hand, you’re likely to see smaller sign-on bonuses and fewer other incentives like income guarantees and loan forgiveness.
Rik Thrailkill, director of operations and interim COO for EmCare, says that companies like his operate on a fixed margin and can’t necessarily afford expensive perks like loan forgiveness. He is quick to add, however, that hospitalists shouldn’t let “super-sized incentives” like sign-on bonuses overshadow other aspects of practice compensation.
As an example, Mr. Thrailkill points to the compensation plan used by EmCare, which pays physicians a bonus based on RVUs. Because that bonus gives physicians an additional $25,000 to $40,000 beyond their salary, he explains, it can over time eclipse even the most generous sign-on bonus or income guarantee, which are typically offered for only one year.
Other recruiters agree that while incentives like sign-on bonuses and income guarantees may calm the nerves of jobseekers worried about what the future may bring, physicians need to look beyond the perks. Jo-Ann Toldt, director of recruitment and retention for TeamHealth East, says that while incentives are a good start, physicians need to take a much broader view.
“If physicians don’t enjoy the practice,” she says, “all the incentives in the world won’t contribute toward satisfaction, retention and sustainability. And that’s what physicians really are looking for.”
Edward Doyle is Editor of Today’s Hospitalist.
Residents reap new sign-on incentive
Residents who sign a contract to work as a hospitalist after training may be in for a nice surprise: They may receive a monthly stipend from their prospective employer while they finish their residency.
The amount of these stipends is all over the map, but recruiters say that checks of between $1,000 and $2,000 a month aren’t unheard of.
And while stipends to recruits still in training are more widely used outside of hospital medicine, the intense pressure to find hospitalists means that more residents can expect to be offered cash up-front, particularly if they’re strong candidates.
They can also expect to field these offers earlier in the year. At least one recruiter said that one of her clients began interviewing third-year residents in July, not September or October.
The money for these stipends typically comes from the same pot that is used to pay a sign-on bonus, so anything residents receive in the form of a stipend is deducted from the amount normally reserved for that bonus. And as is the case with sign-on bonuses, residents can expect some sort of payback provision if they leave the practice before a year or so.
But for residents who are struggling to live “and pay off student debt “on marginal salaries, any money up front is more than welcome.
Look here for the most current hospitalist jobs.