We’ve all heard this in the past: Life isn’t fair. Though that may be true, it’s reasonable to expect your compensation package to be fair when compared to your colleagues, to the market and to the sacrifices and years of training you spent preparing yourself for this profession.
But how do you set expectations when you are looking for a new position? There are many formal (and sometimes costly) surveys out there, from MGMA to Sullivan Cotter and AMGA. You can look to social media or ask your colleagues or maybe your program director.
But what’s the best way to answer the question?
There is no formal gold standard salary survey that all employers use. In our vast experience at Contract Diagnostics, we see more reference to the MGMA survey than others when it comes to how employers set pay.
Of course, employers are all different in how they put together a total compensation package.
Some employers use the median of a major survey, such as MGMA, or a few blended together. Others have their own internal proprietary metrics. Some survey the local market and apply a “goodwill” factor if they have a great brand in the community.
So what is fair?
Fairness is, of course, relative. Does the job allow you the flexibility you want? Will you be working a lot but earning well? Is it a short-term position or somewhere you are looking to stay long-term?
We recommend you get to know the local market by interviewing throughout the area and doing your best to filter the available data. Though most physicians do not purchase the major survey datasets, the hospital or medical group you are looking to join may be able to provide you with some of them.
Do plenty of due diligence
It’s easy to say that you would want to negotiate pay, but we feel the process starts with good questions.
Employers should welcome your questions around pay, whether the compensation is negotiable or not. Having this level of transparency is one of the big steps to ensure you are paid fairly. Questions to ask include:
- How do they set pay?
- What is the range for those in that office/department?
- How often does the compensation plan change?
- What metrics or surveys do they use?
- Are all paid the same, and if not, why?
- What types of reports are provided to providers?
- Are you able to see an example of the data?
Total compensation vs. salary
Once you know how they set and view compensation, you’re able to turn to another important topic in overall pay: benefits. Benefits can range from 0 to more than 30 percent of total compensation.
Though all employers offer different benefits, packages can include retirement plans, paid time off, expense accounts for fees and CME, life and disability insurance, vision, dental and medical insurance, car leases, club memberships and more.
Viewing benefits as part of your pay is essential to evaluating whether or not your pay is fair. This should also be taken into account for independent contractors, who may have no benefits at all (and be subjected to additional taxes).
Discrepancies are real
We have all heard about gender pay gaps, and this is alive and real in medicine as well. All physicians, regardless of sex, race, ethnicity, or visa status should be asking important questions around their compensation.
Raise your hand
Even if you are currently employed and happy with your position, you need to make sure you are paid fairly for the market in relation to your colleagues, your experience and tenure.
It’s important to know a replacement for you, should you leave, could cost your current employer over $100,000. Transition costs for employers are not cheap. They have to spend time interviewing, credentialing, then likely paying signing and relocation dollars. It then takes your replacement years to build their practice to a level the same as yours.
So raise your hand if you’d like a compensation review. It can be painful if you haven’t had a raise in five years, but see new physicians with higher starting compensation and better bonus structures than you.
Don’t just sign
Don’t sign your agreement without taking multiple steps to ensure your pay is fair.
Spend the time to go through these steps. Invest in the process. Employers expect it, and you don’t want to regret not asking the right questions to the right person at the right time. That time is now!
Jon Appino is principal of Contract Diagnostics. He is passionate about the education of physicians in the business aspects of medicine. He currently lives in a small suburb of Kansas City, Missouri, with his wife and two young children.