- You Don’t Have to Choose Just One
- The Big Three Physician Employment Options:
- Academic Medicine Physician Employment – Pros
- Learn, Travel, and Grow
- Rich and Rewarding
- Perks and Resources
- Physician Employment – Academia Benefits
- Academic Medicine Physician Employment – Cons
- Working for Free
- A Cog in the Wheel
- Taxing For Introverts
- Communication Breakdowns
- Academia Politics
- Private Practice Physician Employment – Pros
- Money, Money Everywhere!
- Smooth Operations
- Private Practice Physician Employment – Cons
- Debt and Overhead
- Lawsuits and Threats
- Employee Hassles
- Stressful Conflicts
- Employed Physician – Pros
- Physician Engagement
- Hassle-Free Teaching
- Balanced Priorities
- Cutting Edge Equipment
- Collegial Team Environment
- Summary – Employee Benefits
- Employed Physician – Cons
- Limited Investment Upside
- Smaller Platform
- Risk of Stagnation
- Non-Clinical Physician Employment
Fortunately, there are many physician employment options. Should we work in academia like where we trained? Or branch out on our own? Maybe we should go with the newest trend and become an employee? What do you think is the best place to work?
Most doctors don’t stay in their first job out of residency. Most change within the first few years of practice. They usually stay in the same category of employment though. For example, moving from one private practice to another. So making that first decision will likely influence your subsequent career.
You Don’t Have to Choose Just One
Few doctors have worked in multiple practice environments, but I’m one of them. My practice experiences include working in private practice, academia, and as a salaried hospital employee. Apparently, that is uncommon. The North American Spine Society asked me to speak at their annual international conference on this topic.
Here are my thoughts on the different practice environments. Doctors ask me what is the “best” type of practice. I’m not sure there is one best place. I observed pluses and minuses with each job type.
The Big Three Physician Employment Options:
- Single-specialty private practice
- Multi-specialty private practice
- Hospital or clinic
- Non-clinical employment
Academic Medicine Physician Employment – Pros
My Experience – Academia Benefits
The medical school gave me “a platform.” It allowed me to communicate my thoughts throughout the world. I wrote papers for peer-reviewed literature, taught students, residents, and fellows. I published in all of the major journals in my field and wrote chapters in a leading textbook. The teaching and writing spread my name through the national and international medical community.
Learn, Travel, and Grow
It also opened up opportunities for international travel, international presentations (Edinburgh, Scotland) and to be an oral examiner in interesting locations such as Kuala Lumpur, Malaysia. Working with young students and residents helped connect me to modern trends and stay up with technology and new ideas. Teaching young learners continuously forced me to keep my knowledge fresh and updated. I enjoyed being around youthful energy and optimism of young physicians.
Rich and Rewarding
Increasing happiness isn’t so dependent on a higher salary as it is on optimal spending and social comparisons. Financially, I always felt quite rich since comparatively, I had a very high net worth and a very high income. The students were deep in debt and barely able to cover their monthly bills. The students and residents were smart and eager to learn. They thanked me for teaching and for being a mentor. Many of them are still my friends or practice partners a decade later.
Perks and Resources
I had early information on research and certification trends in my field. Access to all the world’s literature, a research library, psychologists and educational specialist were readily available. Generous pension plans and low health care insurance costs were standard. Clinic hours tend to be reasonable and not excessively demanding. I was given “teacher discounts” and access to TIAA-CREF investments at institutional rates. The free tuition at my university significantly reduced the cost of my MBA. Some of the other perks included: access to free software, educational retreats, leadership conferences, technology, and writing workshops at no cost. My on-campus job made evening business classes manageable.
Physician Employment – Academia Benefits
Credibility with patients, insurers, attorneys
Continual CME opportunities
Ability to train the new generation
Stay fresh and connected with young clinicians
Feel fortunate, powerful, and rich by comparison
Academic Medicine Physician Employment – Cons
My Experience – Academia Drawbacks
Incomes are significantly lower in academia. As a specialist with high potential earnings, this pay difference is big. There are also few options for outside investments or equity ownership in a practice. Committee meetings and medical directorship were often unpaid. There were fees and taxes such as the “deans tax.“ Those taxes would come out of my paycheck and cover who knows what. Those not in a tenure-track or who do not get promoted to full professor are sometimes treated as second-class citizens.
Working for Free
Teaching duties were expected but never compensated. Research work was expected but not compensated. Our clinics needed to be productive enough to cover our own overhead and salary. That expectation was rarely met since the university clinics seemed incapable of running efficiently. State and federal funding and grants seem to have withered away. That trend increases the productivity demands and stress placed on academics.
A Cog in the Wheel
We were unable to talk to pharmaceutical reps or accept a lunch, dinner, or gift from a vendor. That policy limited our ability to learn about new treatments. It made for some awkward dinners at which I was not allowed to eat. I was invited or mandated to participate in various committees. Many met at 7 AM. Most of the time there was no food or coffee or even a greeting from anyone to acknowledge my participation. Many of the committees seemed unfocused and powerless. The decisions had already been made elsewhere. Spending hours in these meetings felt like a pointless and unpleasant waste of time.
Taxing For Introverts
As an introvert, I found it difficult to always have people around me. They watched everything I did and continuously asked questions. They second-guessed why I did everything. I felt like I never had time to myself to think or take a break during the day.
My days go better if I can occasionally grab a few minutes to myself. Something as simple as time to check personal emails, take a stretch break, call a friend, take some meditative breaths or step out into the sunshine make the day more enjoyable. Those breaks remind me that I’m a living human being enjoying the present moment – not a clinical production machine. These special moments were prevented since I always had an entourage of learners. They were always asking me where I was going. I would literally have to tell them, “I’m going to the bathroom now. Please do not follow me – I will be right back.” How annoying.
I was fired from a compensated medical directorship for one of my roles. No one even bothered to tell me. I eventually found out indirectly. It became obvious that my department was powerless since our department chair had no say in the decision.
When the clinic nurses were rude and unhelpful, I could do nothing about it. I tried, trust me. I brought this to the attention of the nurse manager. The nurse manager said that she did not work for me and neither did her nurses. They had no intention of changing anything. I told my department chair about this unbelievable experience. He said he had had similar conversations and experiences. He too was unable to make any improvements. I’m not saying that every academic job comes with all these problems but many of them are prevalent in academia.
Physician Employment – Academia Drawbacks
Less money than private practice
Publish or perish
Declining State/federal revenues
Inefficient clinics and O.R.
Private Practice Physician Employment – Pros
My Experience – Private Practice Benefits
My private practice years were truly great ones. I learned how to run an efficient clinical practice. Having supportive and highly motivated colleagues certainly helped. We could hire and fire-at-will. There were multiple opportunities for collaboration and strategic investments. We selected a manager who carried out our priorities in a way consistent with our values. I was extremely productive during those years. Yet, I could schedule time off whenever I wanted. The autonomy and staffing ratios made seeing patients pleasant.
Money, Money Everywhere!
Financially, there was significant upside potential. As an owner of the business, I was able to capture all of the value that I produced. Furthermore, I received revenue from the work of others. We captured our own downstream revenue from imaging, physical therapy, surgery centers, and leasing medical office space.
As a large specialty practice in a small town, we had name recognition. More importantly, we had clout with the payers and hospital networks. They all knew they needed to deal with our private practice. That clout endowed us with leverage that further boosted our revenue through volumes and favorable contracts.
We structured the practice to minimize any bureaucratic or “paperwork” hassles within the practice. The physicians focused on doing what required a medical license. Operating at the “top of our license” made for a rewarding physician experience.
Physician Employment – Private Practice Benefits
Can be or feel like “the boss”
Ancillary income opportunities
Compensated for risk
Private Practice Physician Employment – Cons
My Experience – Private Practice Drawbacks
Our private practice focused too much on productivity and revenue generation. There were times when I wanted to spend more time with a patient or do procedures that were not well-reimbursed. Such activity was discouraged. Such activities didn’t optimally contribute to revenue and profits.
We had to focus on covering our enormous overhead expenses. The annual overhead expenses came to several hundred thousand dollars per physician. No doctor would break-even until they paid their portion of the overhead. We started each year feeling that we were already in a deep hole that we must dig out of.
Debt and Overhead
The overhead costs and financial pressure worsened as the practice grew. We soon outgrew our space and had to build a new building. Each doctor had to take out a loan to cover the $1 million that every doctor owed. It made good economic sense – at least in the long run. But going back into debt late in a successful career was quite stressful.
Lawsuits and Threats
There are also liability risks in private practice. A commercial realtor sued our practice and all of the doctors individually. It was apparently from a misunderstanding. The commercial real estate company thought that we were going to buy one of their properties because one of our doctors expressed an interest. The property was taken off the market but our practice didn’t end up buying it. That property did not sell the owner filed suit.
We also had higher liability risks from malpractice, partly because of the public’s perception of the “rich doctors.” Some of the partners didn’t exactly keep their financial success secret. That fueled greed and jealousy. In addition, we were sued by employees and former employees. Some of the allegations involved wrongful termination of someone in a “protected class” (age over 40 or a minority). This allowed a federal claim against us.
In those cases, we -fortunately- had excellent documentation supporting the decisions to terminate employment based on over 90 days of poor performance. We were eventually vindicated. We were able to prove those individuals were not targeted or discriminated against. Nevertheless, it generated huge stress and legal fees.
This combination of monotonous clinics, legal liability, financial responsibilities, the need for debt financing, and pressure to cover our substantial overhead was additive. The growing and constant stressors were palpable. There were other conflicts too. Sometimes the doctors or managers would disagree.
Making major decisions became onerous. It seemed impossible to stay decisive, focused, and nimble when 16 partners had equal votes. Multiple divisive factions grew based on minor differences of opinion. Sometimes meetings ended up boisterous or even physically confrontational. I don’t miss those monthly meetings one bit.
Physician Employment – Private Practice Drawbacks
Focus on the almighty dollar
Can feel like running on a treadmill
Increasing overhead expenses
Internal disputes over compensation, overhead, call, buyouts etc.
Employed Physician – Pros
My Experience – Employee Benefits
I am currently employed by a non-profit hospital network. For me, it has been the best of all worlds. I have a lot of say in how my practice runs. As an employee, I have virtually no liability. I do not hire employees or own the practice’s assets. Any disagreements get sent to HR. The human resources department also deals with the intricacies of hiring, salary market assessments, discrimination accusations etc.
I receive a competitive and consistent paycheck along with good benefits. I am part of a large hospital network which provides us with a variety of opportunities for referrals and collaboration with specialty physicians. There are opportunities for education and leadership. Unlike in academia, I feel that my participation is actually valued. People at the meetings listen to me and my fellow physicians and implement any good ideas we provide.
Teaching opportunities exist. Some are even compensated. I teach medical students, residents, and my fellow physicians. I enjoy it and I do so on my own terms. The residents and medical students who rotate with me are extremely grateful. They realize that I am not obligated to teach. This helps them appreciate the gift of education even more.
My employer uses a “balanced scorecard” approach. It is not all about the almighty dollar. We, of course, still have to be fiscally responsible. It is not the only mission or goal of our organization though. I find that refreshing. We are allowed to take extra time with complex patients. We don’t turn away patients with poor insurance or no insurance when they need help.
Cutting Edge Equipment
Our network has the resources to purchase top-of-the-line equipment, EMR, and billing systems. We have a team of billers and coders who keep us up-to-date on changes in insurance or Medicare guidelines. We have a floor of compensation that will cover all of my needs and most of my wants. There’s also upside opportunity for bonuses and future salary increases. I would just need to make changes to my schedule and increase my productivity. Whether and when I choose to do so is up to me.
Collegial Team Environment
I have a lot of say in the hiring and firing of staff. The administration welcomes ideas around improving patient flow or office processes. There is a minimal top-down bureaucratic intervention but senior leadership is available to help set priorities and our organizational mission. Since we have a well-articulated balanced organizational vision, we know where we are going. We have extensive resources to help propel us to our destination and to make our daily clinic life manageable. We do not have excess pressure for revenue productivity at all costs.
Summary – Employee Benefits
Guaranteed base salary
Potential of bonus or incentive
Balanced incentives e.g. the patient good, quality of service
Happy co-workers and a congenial work environment
Treat the patient irrespective of cost
Limited debt, legal liability, or financial risk
Reasonable work hours
Employed Physician – Cons
My Experience – Employee Drawbacks
I have less autonomy than I did in private practice. I am not an owner in the organization and do not have significant equity that will grow over time. Although I have some say in office procedures, hiring and firing. I do not have the ultimate authority. As our organization grows, decisions are becoming more top-down. When senior leaders decide a consistent policy is needed it gets implemented. It will be the same across all specialties even if it isn’t the best for our clinic.
Limited Investment Upside
There is limited upside compensation. I am employed. By definition, my employer needs some portion of the profit I produced for other needs. Those needs may be expanding service lines or subsidizing other less profitable clinics. I’m not able to put away as much money in retirement plans as I would if I owned a private practice. Investment opportunities are also more limited.
I do not have a national reputation or a wide influence across this country let alone internationally. My name is no longer directly affiliated with a famous medical school. There is limited opportunity for international presentations, visiting professorships, or sabbaticals.
Risk of Stagnation
I am not around eager learners. There is limited opportunity for intellectual collaboration, local CME, or evening courses. Even traveling to a conference is somewhat discouraged and that funding is the first to go with any budget cuts. Furthermore, I am at the mercy of any new leadership changes or changes in management philosophy.
Summary – Employee Drawbacks
Not the boss or in control
Limited or no ancillary income
Overall institutional financial and marketplace challenges affect you
Limited ability to research
Few teaching/CME opportunities
Non-Clinical Physician Employment
My Experience – Non-Clinical Work
Since I finished my medical training I have not had a full-time job outside of medicine. I discovered dozens of possible jobs that I would be qualified for or could become qualified soon. I know workers in other fields who have medical degrees. If you get burned out on medicine or want to leave clinical practice you should explore those options.
Although I haven’t worked full-time in other fields I have earned money from other kinds of work as a “side-gig” along the way. I have received honoraria for speeches, stipends for teaching, royalties for publishing, fees for consulting with pharmaceutical companies, investment banks, and law firms. Each of these could be expanded or turned into a full-time gig.
Physician Employment – Non-Clinical Work
What are your impressions of the different practice environments? If you are just starting out, what do you think will be best for you? If you have practiced for awhile do you have any regrets about your selection?
Whoa WealthyDoc! That was such a thorough write up.
I have mainly worked in private practice in Canada and it is the absolute best for my personality and professionally. Our overheads with only 1 staff is super efficient and I believe it’s less than 10% of our billings. We run a very efficient office without partners rhus no arguments. Yay! I don’t have to ask anyone if I want to change anything in our office.
But you certainly give a great over view of all the options doctors have in the USA as well. We have many of the same options in Canada.
I’m glad you like where you are. That is what really matters.
In the U.S. we have a skewed view of the Canadian health care system. Most of the Canadian doctors I have met report something similar to your comments. I was surprised to learn there are opportunities to increase income for those who choose that.
Very nice summary!
Like you, I have worked in academia. I have been a solo practitioner, and worked as an employed physician. Each has their advantages and disadvantages, as you have so well enumerated. Thank you for taking the time to write.
Thank you for the kind words.
It sounds like you are a kindred spirit. It is good to know there are others out there who are crazy enough to try all three. I’m glad you agree with my general ideas about the pro and con of them. So many doctors have asked me to just tell them the “best” that I felt the need to expand on the nuances a bit.
That is really a great pros/cons list of potential practices a graduating resident will have available.
I did the academic route for a couple of years at the same residency I trained and did my interventional radiology fellowship (part of me staying was the director of the program actually created a spot for my ex-wife to join as a resident if I stayed on as faculty).
One thing I noticed is that if you become faculty at the same place you trained, you never fully get rid of the “resident stigma.” Everyone has gotten used to you being a resident and often treat you like one even after becoming faculty for a year or more. Those residents that left and then came back often were treated with more respect than those that continued straight through.
I also did not like the way senior physicians would dump things on the junior ones (I had one attending assigned to read films in the morning and left the whole pile for the junior night person). Salary was based on years there, not productivity and someone with a great work ethic like me who read everything put in front of him got screwed with this type of payment concept.
My current practice is part of a large mutlispecialty group. I have the advantage of a payment system now based on “eat what you kill.” If I read a lot of studies, I know that extra money will come directly to me and not someone else.
Those are all great points. Unfortunately, academia tends to have a less than ideal culture. There is some hazing and a lot of hierarchy based on things other than competence or efficiency. A lot of idealists entering academia become jaded fast by the politics and resistance to change.
I also agree it is good to get your training elsewhere. If the nurses used to call you Bob and you dated her friend when you started training, they will never be able to see you as “Dr. …” the knowledgeable expert in the field.
My private practice was “eat what you kill” and it worked well. No one really cared if I wanted to work more or less because it mostly just affected my own income.
Really great post WD. Great insight to the pros and cons of each type of structure. I joined private practice straight of training so that’s all I know. I miss the teaching part of an academic institution, but I don’t think I could handle being watched all the time like you said.
“I would literally have to tell them, “I’m going to the bathroom now. Please do not follow me – I will be right back.” How annoying.”
Now that is funny!
The difference is in private practice, there is NO time to go to the bathroom.
In my private practice, the profit at the end of the month gets split evenly and everyone gets the same share, so the griping becomes about who is the weakest link and riding on others. Fortunately, our group is pretty collegial.
Glad you liked it, MD.
I’m steady-busy now at work but I have time to drink water and take care of bodily functions. Sometimes I have time to chat or joke around and I love that.
Yes, the medical students are the worst. They think they can impress by being attentive and they don’t want to miss anything important so they would be glued to my side. The way to impress is to be quiet and don’t interfere with the clinic. Help with scut voluntarily and study and know your stuff. They don’t get that for some reason.
My private practice had a rare but wonderfully effective method of allocating profits. It was based on a percentage. If you make 10% of the revenue you pay 10% of the overhead. It may be a little unfair to the highest earners since they would pay the bulk of the overhead. In my practice, there were two ortho-spine doctors but they didn’t seem to mind since they made a ton of profit and the rest of the group fed them cases. If I work less and drop from 20% to 8% revenue then my overhead expense drops too. We NEVER fought about productivity or how to share profits or expenses despite a multispecialty arrangement. That is very rare from my discussions with other private practice doctors. It was a true eat what you kill arrangement. Not a eat what other people kill kind of deal.