While the public at large often views physicians as having high salaries, those within medicine understand that quantifying a physicians’ compensation is a complex process, Medical Economics reported May 6.
Primary care physicians, for example, earned an average of $300,000 in 2023, according to the report, much lower than the $432,983 average for nonsurgical specialists. However, rising healthcare costs have placed increased pressure on physician pay negotiations as healthcare facilities try to manage costs.
Here are five things for physicians to know as they approach salary negotiations, per the report:
1. Get a full understanding of the compensation package. Compensation packages can feature a number of potential add-ons, but these can be difficult to negotiate after the fact, if not confirmed up front. For full-time roles, Medical Economics encourages physicians to ask proactively about benefits, sign-on and retention bonuses, relocation compensation and loan repayment. It is also important to ask proactively about a practice’s philosophy around schedule, patin time off, family leave and other nonmonetary benefits.
While locum physicians are not offered the same compensation packages as full-time employees, it’s still important to ask about hourly rate, start and end dates, shift schedule and cancellation policies, onboarding and administrative processes at the onset of negotiations.
2. Understand malpractice coverage. Physicians should determine as early as possible what responsibilities fall on them in the case of malpractice. Locum physicians who are not working through an agency should dedicate time to educating themselves on buying their own policy. The report also encourages physicians to understand tail coverage, which protects them from claims filed after a policy ends. This can be essential when switching jobs or insurance carriers and prevent unexpected legal or financial issues. Practices may also be able to assist physicians financially with this coverage, so it should be discussed early on in negotiations.
3. Get familiar with RVUs. While private practice and locum assignments may utilize relative value units less than other settings, it’s important for physicians to understand if and how they may be factored into productivity and value tracking at their organization. Specifically, physicians should ask what the multiplier is per work RVU and the threshold expectation to start earning the multiplier in order to understand their true earning potential.
4. Leverage market research. Understanding the lay of the land when it comes to compensation is important for physicians going into contract negotiations as practices may have a threshold of what they’re willing to negotiate. In addition to online research, physicians should reach out to others in comparable positions to get a realistic idea of what they might earn.
5. Know when to walk away. Physicians should have a clear idea of what are deal-breakers and boundaries for negotiations.
“Determine what is and isn’t negotiable beforehand and recognize that not every position is worth compromise,” the author writes. “Walking away isn’t a failure; it’s an opportunity to find a better fit. Locum work is a compelling option that allows you to work in different practice settings and locations to determine what is best for you.”
