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A financial package that gives doctors security and a fiscal leg-up in launching their careers could be the major fringe benefit in attracting them, according to the results of a recent study about the practice preferences of new physicians.
The 1997 Survey of Final-Year Medical Residents by Merritt, Hawkins & Associates, an Irving, TX, recruiting firm, yielded few surprises about the employment picture in primary care except that family physicians, internists, and pediatricians are becoming more confident about their worth — and willing to flex competitive muscle to achieve it.
"In the past, some candidates have been surprised by their value," says Mark Smith, Merritt Hawkins vice president, "which we believe is no longer the case. After all, if you’re asked to dance as many times as these doctors will be asked, eventually you’re going to find out that you’re fairly attractive. That’s what’s happening here."
Survey results indicate:
• More than 90% of new primary care physicians expect initial annual incomes in excess of $100,000.
• More than 75% of them would be affected "somewhat" or "greatly" by a $12,000 signing bonus in choosing an opportunity.
• More than 77% of U.S. trained candidates also would think favorably of an offer that included loan forgiveness, even if it’s attached to a three-year commitment. (For more information, see copy of survey results, p. 51.)
The profile emerging from this year’s survey class of 300 is one of physicians who are better informed and expect better pay than their older colleagues. They’re turning down entrepreneurial medicine for salaried positions and gravitating toward single- and multi-specialty situations rather than solo practices and partnerships.
More than 60% of those polled say they prefer to work in a group setting, up from 53% in 1995. Only 2% are holding out for a solo situation, while 12.7% are still open to a partnership.
When asked about compensation, 86% said they expect to be paid as salaried employees, including a majority (72%) who want a base plus production bonus. The latter figure is up substantially from 1995 when 55% indicated that preference.
The numbers reflect a shift in thinking by physicians that fortunately parallels the marketplace, Smith says. Young doctors are looking for salaried positions at the same time the industry is offering them.
They want financial stability, so it’s not surprising that fewer of them, 11.3% in 1997 vs. 41% in 1995, are willing to take an income guarantee, intrinsically more risky than a salary. Only 2%, will settle for compensation based on production alone.
"Graduating residents and fellows today are averse to taking risks," says Roger G. Bonds, MBA, CMSR, president of the National Institute of Physician Recruitment and Retention in Atlanta, a national training resource for in-house recruiters. "They see their situation overall as so precarious that anything that will cut down on that possibility looks good to them.
"They don’t have as much control over their destinies as doctors did five years ago. So if they can defuse one of the challenges of going into practice by taking a salary, it’s probably a smart move to them."
Indeed, despite their openness toward salaried positions, only 10.7% (down from 20% in 1995) say they prefer working in a managed care environment. Another 29.3% (up from 19% in 1995) wouldn’t choose it. Smith attributes the declining interest to a combination of factors, including bad press, bad reviews, and bad initial experiences.
"Physicians don’t like practicing what they consider cookbook medicine," he says. "They may like the fact that their call is one in 25 and that they can leave at five. But they don’t like it that every time they turn around, somebody is telling them what or what not to do."
In any case, offering them money — and other benefits — won’t be enough if an offer is in a place that they couldn’t call home. Geographic location is still the first consideration after quality of care in selecting an opportunity for 72.7% of respondents.
Once that’s taken care of, 42.7% say a good financial package and loan forgiveness is their second consideration. Combined with 18% who rank those concerns first, the responses reveal a group of doctors who put finances above other factors including specialty support and even adequate call/coverage.
What message do those numbers send to recruiters? Be creative and competitive in the financial package you propose because it’s the major item you can control, says Smith. It may also be the only way to get a candidate’s attention and separate your offer from others.
Perks such as loan forgiveness and signing bonuses can be a bargaining chip, especially when salary only goes so far. They can make a significant difference for candidates with earning potential — and a heap of debt. And they can be done in various ways, for various amounts, to build relationships now for later.
Bonds encourages institutions to offer signing bonuses in the form of yearly stipends before candidates leave their residencies. The money is discretionary income that can make a difference in residents’ lifestyles just when they need it. At the same time, it’s the tie that binds them to the institution or group.
Young physicians are becoming increasingly tuned-in to those items that will tether them to a practice. It’s not surprising then, says Smith, that 77% of U.S. trained respondents in this survey say they would be affected by loan forgiveness, even if it came with a three-year contract.
That arrangement can be positive for both a candidate and your hospital or group. You get a commitment of time and the promise that if the physician leaves, there will be a payback. And the doctor gets help with one of the biggest financial burdens he or she will ever face.
"If you don’t establish a strong financial package and some form of [loan] forgiveness, the debt will stay with these doctors forever," Smith says. "So it’s imperative that you provide that security upfront."
It also might help you stay ahead of the parade of other recruiters clamoring for the attention of candidates, when they’re also getting information elsewhere.
Consider that 67.3% of respondents say they will seriously examine practice opportunities at least one year before they finish training. More than 85% of them rank sources other than recruiters as the primary method by which they get information. Their contacts include word-of-mouth and networking (44.6%), residency programs and specialty societies (17.3%), journal advertising, and even the Internet (23.4%).
That doesn’t shut you out entirely, however. While 14.7% name physician recruiters as a first source of information, another 38.7% rank them most often as a secondary resource. Also, more than half (63%) of U.S. trained and nearly half (39%) of foreign-trained physicians report receiving an excess of 25 recruitment solicitations during their residency.
No matter where you are in the mindset of those doctors, this survey should be a useful tool in helping you solidify your approach in attracting primary care physicians to your institution, Smith says.
"The feedback from these residents," he says, "is as close a temperature as we could take to see if we’re on the right track in providing the right package.