The money section of the Wall Street Journal this September referenced a study by Northwestern Mutual Life Insurance in which it concluded that Americans would rather talk about sex than money.
Many of us have come to learn that it is impolite to discuss money, which may account for the reason that so many of us are uncomfortable with the topic—much less tackling salary negotiations.
Over the last two decades, I have served as a liaison between CEOs and physician candidates during the various stages of the recruitment process, including contract negotiations. Empowerment during a physician salary negotiation comes from knowledge, strategic planning, timing and an understanding of the rules of engagement.
Know your money terms
Knowing the differences between salary, productivity and financial packages is important. They are not synonyms. Salary, along with the productivity piece, is income reported on your W2; a financial package includes your salary, productivity, signing bonus, CME allocation, benefits (i.e. insurances, retirement plans, etc.), relocation stipend and any other items assigned a dollar value.
In layman’s terms, a financial package is akin to an employee’s hidden paycheck. Be advised that when it comes to financial packages, there are governing bodies that impose boundaries and mandates on salaries, benefits and incentives legally acceptable in a job offer to a physician candidate.
Get your sources in order
One the best pieces of advice is to become knowledgeable about salaries using data collated by reliable sources such as MGMA and other organizations offering compensation benchmarks by region, state, practice structure and setting.
Also seek real-time salary benchmarks from colleagues who have recently accepted new positions. They can speak about their experiences in negotiating deals along with offers they received during their practice search. When the topic of salary is initiated by the prospective employer, it is advisable and reasonable for you to ask about the salary range of recently employed physicians working in the practice.
Additionally, you may want to seek any documentation that substantiates your anticipated compensation, which is often derived from a medical staff plan conducted by the hospital.
Make a professional connection
The first steps toward a successful salary discussion rely on the initial interactions between parties and their perceptions of each other.
Your ability to make a personal and professional connection with practice decision-makers is paramount. You must also have the ability to succinctly communicate your skill set in a way that aligns with the practice’s needs, yet in a way that doesn’t appear boastful. The end game for you is to build a foundation of respect, cohesiveness and mutual interest in taking the next steps.
Salary discussions should be initiated by the practice, not you. For the prospective employer, recruiting new associates to a practice is expensive and one that requires a deliberate, cautious approach. The decision-maker must have confidence that you match the personality and culture of the practice before they will even utter a syllable about money to you.
Bring up salary at the right time
Despite etiquette debriefings with physician candidates about the appropriate timing to discuss salary, I have on occasion had physician candidates who have gone rogue during an initial conversation with a practice leader.
A common mistake made by these impatient candidates is positioning a premature salary discussion as a courtesy when their true agenda is transparently evident: “Before we begin, as I do not want to waste your time or mine, how much are you offering?” In post-interview conversations with medical directors and CEOs on the receiving end of this dialogue, I’ve learned that many not only eliminate these candidates from consideration, but also make comments such as, “They were too money motivated; we have decided to pass on this candidate, as they are not a match for our practice.” One physician leader asserted in a conversation with me, “…since when is it commonplace to offer a dollar amount before you know what you are buying?”
When it comes to talking about compensation, patience, knowledge and timing are everything.
The idiom “all in good time” should be the mantra for physicians seeking new positions. Rest assured everyone in the process understands you are not a volunteer and expect a fair wage to share your talents. That said, your rushing or pressuring the salary conversation before the appropriate time is not only ill mannered but myopic. Successful negotiations require emotional intelligence combined with confidence supported by factual data and market information.
Conduct yourself in a calm, controlled and professional manner in all interactions with the practice. As is true in all negotiations, be prepared to walk away if discussions experience an impasse. Options are not only empowering, but also liberating. Have a minimum of two and no more than three positions as finalists. That’s not to suggest playing contracts against each other but rather giving yourself the option to negotiate in good faith effort with a safety net.
This brings me to another observation: When it comes to negotiating, people invest their egos into the interaction. Seems as though everyone wants a story to tell friends about how they outsmarted the opponent, which resulted in their being a master negotiator. This may work when buying a car, but when it comes to employment agreements, administrators and their board of directors, for the most part, have structured an approved financial package.
This is not to say that an offer should be taken at face value and that dollars cannot be moved from item one to item two in structuring your best deal. But there are legal and financial boundaries that confine all parties within a negotiation.
How to discuss financial criteria
The conversation about salary and benefits is usually broached during your site interview by the practice. The initiator should be the practice representative who almost always is the practice’s decision-maker and is serving as the administrator or lead physician.
As a rule of thumb, confine your physician compensation negotiation to your recruiter and the individual in the practice who possesses the authority to say “yes.”
As a recommendation, talk with your recruiter about your financial criteria before speaking with the practice. The recruiter should have insights about the group’s standard agreements, salary ranges, A/R, anticipated revenue and other vital information.