Jillian Byhee
Jillian Byhee

What to negotiate – and what not to negotiate

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Chris Hinz

Table of Contents

Nothing — besides finding a great job — is likely as important to you as negotiating a great deal.

WHEN LOOKING FOR YOUR NEXT opportunity, your goal is to finesse a deal that satisfies you every which way. But how do you know what to negotiate and what you likely have to leave on the table?

“I’ve found that almost everything is negotiable,” says Gene Ransom, JD, CEO of Baltimore-based MedChi. “There’s always an exception to the rule. You just need to ask.”

So how do you ask? We’ve put together must-have information about the general process and those items that you likely can go after versus those you’ll likely have to leave alone. Knowing the realities, particularly about three top targets — compensation, non-competes and work/life balance — may help you shape and negotiate a great deal!

Untouchables baked in

A good negotiating starting point is to put aside items that you likely can’t touch. Whether you’ll be employed by a large system or join an independent private group practice, HR managers have built a bevy of non-negotiables into the usual and customary benefits shared by everyone.

For starters, every physician contract is steeped in legalese, including a bevy of significant regulatory statutes that will govern what and how you’ll be paid. You won’t be able to modify them or any standard policies defining your work life. Likewise, you probably can’t put a dent in the health care plan, modify the family leave structure, enhance the vacation schedule, or change any boilerplate benefits just to suit you. Keep in mind, that many of the perks that come with joining the organization are bundled in a standard package.

As Lisa Gora, JD, of Epstein Becker & Green PC’s Newark, New Jersey, legal team notes, the entity’s focus is avoiding any hint of discrimination. So extending family leave for one new employee, for example, is likely not in the cards. “You have to have policies that apply to everyone equally,” she says.

Size sets the stage

Beyond those untouchables, everything is theoretically on the negotiating table. Yet organizational size and structure really do matter in terms of what you can or can’t do.

The larger, more complicated the health care system, the heavier the lift to change provisions than the lift for a smaller entity. If, for example, the organization has multiple hospitals over multiple states, you’ll likely encounter policies that your potential bosses can’t budge on because they’re governing so many employees with so many contracts.

If, for instance, there are 20 physicians in your specialty all earning between “X” and “Y,” you likely won’t do much better being the 21st.

As Kip Aitken, director of physician recruitment at CGH Medical Center, notes: “You’re not going to be able to negotiate a salary that’s outside of that band. That’s just what they expect the job is going to pay.”

Conversely, the smaller the entity, the more negotiating flexibility you may have, as you’re building one-on-one relationships with those who probably will make the offer. Also, if they “really, really want you because you’re going to make up a third of their revenue,” Ransom says, your bargaining power is likely much better than if you were one of a staff of 30 in your specialty.

Indeed, whether it’s a small independent rural practice, a community hospital or an academic medical center group, there are progressive challenges tied to size and structure. “Those are very, very different types of organizations,” says Sherri Vaughn, M.D., associate chief medical officer for The University of Kansas Health System. “Their contracts and flexibility will be very different too.

Compensation tops negotiables

So, what about those negotiables? When it comes to opportunities, compensation usually tops the list. Fortunately, no matter where you land, there’s usually wiggle room on salaries. You can’t change the fundamental pay structure, but you probably can finesse a salary number that fits your goals and the research that you’ve done.

But what should you know about any offer on the table?

For starters, before raising your salary expectations, realize that your future bosses are constrained by whatever they can offer by fair market value. Compensation must reflect internal equity. That is, how does the salary they’re offering you stack up with the salary for the same skills and experience that they’ve offered in the past or in the future? For administrators, managing agreements with various and sundry elements to appease various and sundry people is cumbersome and potentially unsettling, especially if and when staffers begin comparing notes.

Indeed, salary is one piece of the package puzzle that St. Louis-based SSM Health administrators are willing to negotiate if the stars align. Yet because her organization is a Catholic non-profit entity, Jessica Hall, who works in provider recruitment, warns that any offer must fit both internal compensation policies and fair market value.

Even as you’re negotiating, your attention should be on how your potential package will be structured. Will your earnings consist of a guaranteed salary alone or with performance or other incentive-type bonuses? And how might productivity measures or quality factors figure into the mix? You may welcome an initial salary guarantee, but if your compensation eventually rests on work relative value units (WRVUS) or a percentage of what you bill, be very certain as to how that transition works.

Too often, says Michael Belkin, JD, divisional vice president for amn Healthcare/Merritt Hawkins, candidates focus on negotiating the best upfront money—a “short-term reality”—when they should be concerned about long-term implications.

You clearly don’t want to be blindsided at your first review that you didn’t hit the mark because you didn’t understand the compensation formula, or it relies on a patient census that simply doesn’t exist. Instead, make sure that the projected numbers are both real and reasonable so that you have a realistic hope of meeting your performance goals.

“It’s always best to have an example utilizing the actual formula,” Gora says. “You want to avoid ambiguity or broad language that employers sometimes insert into an agreement.”

Granted, when it comes to the primary components of a compensation package, it’s tempting to focus only on base and bonus, the salary that you’ll earn for honoring the employment terms and the extras for reaching goals and completing tasks. But don’t ignore the benefits that, as Ethan A. Nkana, JD, MBA, principal of Rocky Mountain Physician Agency, notes, “add a tremendous amount of value, although the value generally can’t be deposited into a bank account.”

In fact, you should be concentrating on what he calls the “wrap-around value” of the entire contract. That is, pay attention to every item that might maximize what you’ll earn or even provide a negotiating opportunity.

From paid time off (PTO) and continuing medical education (CME) stipends to bonuses for administrative, leadership or other tasks, the list that Nkana presents to his clients reflects an expansive array of items that could tie a bow on any deal.

Indeed, having a CME stipend in your package can be a real bottom-line plus. Ditto on other fees. With a price tag attached to getting a medical license, earning a dea number, taking your boards, or joining a professional society, having the organization pick up the collective tab can be welcome. It’s worth negotiating the above pieces or any other items fitting your wants and needs.

For instance, although Jillian Bybee, M.D., accepted her position with Helen DeVos Children’s Hospital in late winter several years ago, she wanted to wait until summer, well after graduation, to come on board. Even though her new bosses insisted that they needed her before then, she successfully negotiated a later start date. “It was within the realm of what they were willing to do,” she says. “Both sides were reasonably happy with it.”

Today, as a pediatric intensivist and associate pediatric residency director, Bybee urges young physicians to be resolute in their requests, even if they’re in specialties with more candidates than opportunities. Bybee advises finding the right position first so that you can be confident and proactive in negotiating your priorities. More importantly, you’re not rushing into a position before you’re rested and ready to take it on.

Going for the non-compete

If you and/or your employer dissolve your relationship at some point, you want to know that you’ll have the flexibility to move on with your life. That may mean negotiating changes to a potentially onerous or overreaching non-compete.

Yes, you can debate the legality or even sustainability of any restrictive covenant clause. But non-competes are a legally binding — albeit “generally troublesome” — fact of life in most states.

You likely won’t be able to eliminate the clause from your contract, but it is fair game to challenge those geographic and time restrictions that may bootstrap your future choices by being unreasonable. Will you be prohibited, for instance, from performing your specialty within “X” miles of the organization’s furthest clinic or just from where you hold office hours most days of the week? Does it forbid you from working close by for multiple years rather than months?

Restrictive covenants vary from state to state, so know just how it works in your location. Make sure that the non-compete scope is truly reasonable for both time and geography. More importantly, where does the distance emanate from? If you’re aiming for a sprawling hospital system or even a large private practice, does the area apply to every office or clinic that you enter?

“You want to make sure that if you were to leave the organization, you haven’t taken on something that would require you to also leave the state or upend your entire life,” Bybee says. “It’s at least worth an ask. The worst that people can say is ‘No.’”

Striving for work/ life balance

If there’s a trifecta of major negotiating targets—with compensation and reasonable noncompetes topping the list—work/ life balance is certainly up there too. Fortunately, in today’s health care environment, more and more employers are recognizing that more and more physicians want flexibility.

You might be able to negotiate your practice commitment in any number of ways: By working fewer, but longer, days; by reducing your direct patient care to less than the traditional 40-plus hours a week; or by getting a commitment for more personal or administrative time off.

At Western Anesthesiology Associates, Inc., for instance, practice leadership provides various scheduling options to satisfy the wishes and needs of its 60 physicians servicing a variety of St. Louis-area hospitals, ambulatory surgery centers and medical offices.

Whether the physicians want to work five or fewer days a week or participate in full or limited call, for instance, the group offers the kind of flexibility that can be a major draw and negotiating point or plus for both sides. They’ll also consider flexible per diem and hourly arrangements.

As Donald E. Arnold, M.D., president of the practice and first vice president of the American Society of Anesthesiologists, notes: “We decided as an organization over 25 years ago that because people were not all cut out by the same cookie cutter, they were going to need a different level or varying levels of commitment to their professional work to satisfy their personal life. So, we have the ability to offer positions based on a physician’s individual goals over the arc of their careers.”

Final thoughts

Whatever your professional niche, negotiating a satisfying deal still involves sticking to your work/ life vision.

Where do you have the best opportunity to secure a great job long-term and live a great life in a great place? You may not be able to lasso everything. That’s the nature of the beast. But you want to bring your best-educated negotiating skills to bear so that you can secure the best arrangement for you. Whether that means less salary and more work/ life balance or something totally different, it’s to your advantage, say experts, to take the decision-making long view rather than quickly following the money.

That means being comfortable with the priorities that you can negotiate—and those items that you must leave on the table. •

 

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Chris Hinz

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