The survey, which was sent to 5,000 2009 residents and fellows between December 2009 and January 2010, resulted in employment compensation arrangement as the major preference (60.3%) compared to income guarantee (39.7%).
The survey also explored the advantages and drawbacks of employment and income guarantee arrangements, with some surprising results. Physicians cited “increased financial security” as the most important factor when comparing the two compensation agreements (63.7%). It was followed by a “fixed compensation rate” and their “work hours being devoted to patient care and not running a business,” which both tied at 46.6%. Other considerations for choosing between employment and income guarantee include “decision-making capabilities” (34.5%), “fixed schedule” (29.3%), “physicians not wanting to be told when to come and go” (29.3%), “collegiality among colleagues” (24.1%) and “business and leadership acuity” (24.1%).
Michael P. Broxterman, COO of PHG commented, “In today’s industry and economic downturn, we see more doctors who don’t want to take on the typical financial risks. Most of the young doctors we work with want security and a balanced quality of life. In addition, we also see the trend among baby boomers accepting a change in their careers towards employment simply because they are fatigued by the business of medicine.”
Unlike in previous years, where most physicians preferred solo practice and the high earning potential of income guarantee, today’s physician recruiting industry is inclined towards employment. However, some respondents still favor income guarantee. A Cardiologist remarked, “There is earning potential and professional growth in income guarantee, but some healthcare groups are not being clear about it in their contracts.” An Anesthesiologist also noted that while he prefers income guarantee, “I don’t have much of a choice but to be employed as I have no practice to set up.”
The industry may be trending towards employment, but there’s still some interest in income guarantee. When physicians were asked to choose between employment and income guarantee, provided that they made 10% more under income guarantee, 52% of the respondents opted for income guarantee.
Broxterman concludes, “Over 90% of all the opportunities our clients offer to physicians are either employment only or include both employment and net income guarantee as agreement options. How healthcare groups structure their compensation agreements can affect their recruiting plans as well as physician productivity, so they must plan it out carefully.”