For resident physicians making the transition directly to practice, the end of residency brings with it an important milestone: Picking your first physician practice setting after a decade or more of training.
Beyond geographic location and salary, there’s much more to explore, including: What’s your ideal practice environment? What kinds of compensation structure and benefits are important? Will there be support for time-consuming administrative tasks? And will you ever get to take a real vacation?
Those questions may not be forefront in the minds of resident physicians, “a group of folks who, for the most part—90% of them—have never had a ‘career’ job, ever,” said Brandi Ring, MD, the chair of obstetrics and gynecology at a 115-bed hospital in Keene, New Hampshire.
Residents transitioning to practice “have been in school for 30 years. They’ve never interviewed for a job. They've never had to know what their own worth is,” said Dr. Ring. “They don't understand their place in this business world and the fact that physicians are one of the very few revenue-generating people” in the world of health care.
It can be tricky for those accustomed to an academic environment to learn how to assess more than just a job’s salary and benefits, said Dr. Ring, an AMA member who has worked in both private and academic practice settings and who teaches a course on physician contracting and negotiation.
“Coming out of residency, you don't feel like you have any negotiating power because you have no power in residency,” she said. “So, it is very common for early career physicians to have no concept of what that worth is to an organization and for organizations to take advantage of that.”
Dr. Ring has advice, though, for residents emerging into the wider job market: Ask questions, look at the job holistically and decide what works best for you.
Find a fit for the long haul
The research shows that many early career physicians fresh out of residency end up in a transitional job, one that they often will leave within just a couple of years. Dr. Ring said those mismatches can be costly for physicians and their employers, who may need to spend $1 million or more to replace physicians lost to turnover.
“Leaving a job as a physician has a significant economic impact,” she said, giving as one example medical liability insurance or tail insurance. Though sometimes those costs can be negotiated into a new position, “often that's going to take the place of a sign-on bonus or reduce your sign-on bonus.”
Departing physicians also need to pay—or negotiate into their new contracts for—moving expenses. Such costs can be even higher when noncompete agreements, also called restrictive covenants, are so restrictive that they require the physician to leave the state if they want a new job. Another important consideration for departing physicians is knowing the time required for their employer contributions to their retirement accounts to vest, which can sometimes be years for new physicians.
“If you leave a job in just two in three years, your employer was contributing all this money to your retirement account, but you might only get to keep half of it, or you might not get any of it because you haven't stayed with them long enough,” Dr. Ring said. “So not only are you in a job that you are not a good fit for, but there's all this money on the table that you just might decide to walk away from.”
That doesn’t mean, though, that transitional jobs are always the wrong choice. Dr. Ring said residents with heavy educational debt loads should not discount positions that offer generous medical student-loan repayment and a chance to explore different practice environments.
“There are a bunch of ‘get employed for a period of time for repayment’ options out there, and people tend to kind of shy away from them a little bit,” she said. “But honestly, for a lot of reasons, it's a great option to start there. It actually frees you up a little bit” for a more lasting position down the line.
With finances, more than salary matters
When Dr. Ring finished residency, she wanted to go back to her hometown of Denver, and that desire limited her options. It’s important, she said, to also think through all of the business details when scouting out that first physician job.
“In residency you’re like: Oh, my only decision is academic or nonacademic. That's really all that's presented to you,” she said. “Both of the jobs that I was looking at were private practices, but certainly I didn't think about the impact of how that private practice was structured, what effect it would have on what my day-to-day looked like and what my income and earnings would look like. I certainly did not have any of that kind of business gestalt to think that far in advance.”
In a first job out of residency, a physician may get a guaranteed salary for a year or two. After that, Dr. Ring said, a variety of factors may influence earnings. In addition to understanding productivity goals, you should also know about how the practice or organization’s finances will in turn affect yours.
“As the cost of medicine is increasing and increasing and increasing, as overhead goes up, your revenue goes down,” she said. It’s important for physicians to understand their share of the load.
Some of the other questions she suggests asking potential employers include:
- What is the structure of your private practice as a corporation and how is it set up?
- Is there a private equity component to your practice? How is clinical autonomy protected?
- How does overhead affect physician salaries?
- If you want to hire a new staff member, what does that process look like?
- Do physicians have their own dedicated medical assistant to help during the day?
- What is your responsibility and oversight of nurses or nonphysician providers, in terms of reviewing their charts or signing off on the care they provide? Are you compensated for that work?
To get good answers, go to the people with whom you’ll be spending the most time at work, Dr. Ring advised. Fellow physicians and other members of the care team will give you insight into the real day-to-day workings.
“Someone who is in that practice who can answer those questions is extraordinarily valuable,” she said. That firsthand reality check will tell you, for example, whether “an eight-hour day really is as rosy as the eight-hour day that they're picturing. Or is it really a 12-hour day and you never get a chance to stop and breathe?”
Additionally, physicians should have an attorney review their employment contracts, providing the kind of specialized guidance that helps avoid trouble down the road.
The AMA has teamed up with Resolve, a contract review and negotiation firm specializing in physician employment, to provide custom contract review to AMA members at a discount. Resolve offers personalized legal experience to help physicians secure the best employment contract terms no matter where they are in their careers. Ready to access your AMA-member Resolve discount? Learn more now.
Figuring out your comfort zone
Physicians often work long, sometimes unpredictable hours. And when job-hunting, it’s helpful to know how much of that time will be taken up in the EHR and with other bureaucratic processes like prior authorization and surgical pre-approvals—often unpaid burdens.
“Critically, what everyone is struggling with is administrative tasks,” Dr. Ring noted. “For folks coming out of residency now, other administrative support tools are going to be really important,” she said, specifically mentioning ambient augmented intelligence (AI) or digital AI scribes.
What it may come down to is “really asking how that overhead for all of those people who make your life administratively easier is reflected in your bottom line and in your revenue.”
Ultimately, she added, it’s about figuring out your comfort zone.
Learn more with the AMA STEPS Forward® toolkit, “What to Look for in Your First or Next Practice.
Evaluate the Practice Environment to Match Your Priorities.” It is enduring material and designated by the AMA for a maximum of 0.5 AMA PRA Category 1 Credit™. Read up on AMA accreditation.
Keep an eye out for red flags
As with personal relationships, it’s important to notice and pay attention to your impressions during the job-hunting process. And if you spot enough red flags, don’t be afraid to act, Dr. Ring said—no matter how far into negotiations you are.
“If something's not going well in that prehiring negotiation time frame—you get a bad vibe, you are not having good negotiations—if you're getting this much pushback over a hiring, it is not going to get better once you get hired,” Dr. Ring said. “Trust your gut and don't get into a situation where you are going to be abused and manipulated. If it doesn't feel right, walk away.”
Find out more about the AMA Resident and Fellow Section, which gives voice to—and advocates on—issues that affect resident and fellow physicians.
