With today’s wild and woolly job market, emergency physician candidates are experiencing an unprecedented variety of items tossed at them, from huge sign-on bonuses to free dry cleaning. It’s especially difficult to sort through all of it and make sense of what has value. What is a sign-on bonus really worth in the long run – or loan payback, hourly salary, bonuses, pensions, retirement, and of course the now popular RVU incentive? These days, I find younger physicians, particularly those just coming out of residency, are more susceptible to fabulous front money and less impressed with the long-term gains. That can be a big mistake. Let’s look at each category.

Sign-on bonus

Ah, the wonderful world of short-term bribery … to be honest, that’s what sign-on bonuses are, a bribe to get you to take one job over another. I have nothing against financial gain, being a devoted capitalist from way back, but I like a big bang for my buck.

A $30K sign-on paid when you sign a contract sounds really juicy, doesn’t it? But what if I told you that the average physician blows these dollars long before starting the job and, all too often, figure out in a few months that oops, the chunk of change was nice but the job really sucks! The scenario draws from the same pool of psychology as lottery winnings … found money blown on unimportant frivolities leading to bankruptcy. You know the story.

What I’m starting to see now is a sign-on bonus structure that is spread out over time, rewarding longevity. It’s more of a “Thank you” than a “Please,” and far more valuable in the long run. If you perform well, your value goes up, as does your retention bonus.

Loan payback

With the average grad coming out of residency with an educational debt in $300-$350,000 range, that’s a heck of a big millstone hanging around the neck. Asking employers to help with that used to be a Federal or State Underserved Area perk. But these days, emergency medicine residents are adding it to their must-have lists. Certainly having an employer tell you it will take a third of that debt off your hands is a high-value compensation item, but it all depends on how it is structured.

No one except a desperate lunatic is going to offer $100K in loan payback for signing a 1-year contract. This is strictly a time equals money deal. Expect an average of $20K-$25K a year scenario where you must work 4 or 5 years to realize the full value. And here’s the rub. You’d best be real sure you are going to be happy in the job, because 5years is a long time to be miserable at work! Try to get a pro-rated application of the loan payback, so that if you do decide to leave before the full-time commitment is up, you don’t lose what you have earned to that point.

Avoid the all or nothing deal; it’s too much of a gamble. Also, don’t expect to see this option with a small, democratic, private group. Most don’t have the profit margins necessary to fund this kind of deal, even on a long-term basis.

And equal equity ownership groups are going to be hesitant if it was not provided for the owners in the past. These kinds of groups have more profit-derived dollars to offer that can potentially be even more lucrative down the road.

Hourly salary

Many candidates hear the hourly and stop listening. Big mistake! Guaranteed salaries are hard to find these days, and the really high ones ($225 to $300 an hour) are usually in location-challenged areas where money is the only sales lure they have to offer. It is also usually in lieu of bonus pools and RVU-driven compensation that can sometimes add up to even higher levels of earning.

Most employers are going with a multi-level compensation program that starts with a guaranteed hourly base that is supplemented with incentive earnings and benefits. These guaranteed hourlies can be shift-based, with higher dollars available for nights, but the shift differential is a tired trend that is, in my opinion, on its last legs.

To realize true value, look for a base that is commensurate with norms in the area and, when added into the full package, creates a strong comp figure in exchange for the work. Make sure you are not required to work an unusually high number of hours annually to earn the max income. Full-time clinical in the private sector averages around 1,400-1,600 hours.

Benefits

These are a disappearing commodity. In the good old days you had paid vacations and health coverage and disability and all sorts of cool stuff that added as much as $65-$70K to your package. Now? Not so much. If you take on a position as an independent contractor, this category is moot – there are no benefits except malpractice coverage – end of story. As an employee, the most important benefit you want to look for is strong health care coverage for you and your family, hopefully including dental and vision and prescription options.

That’s where the true value lies. Disability is attractive, but it is mostly available to a hospital employee or employee of a large group. It also has to provide a serious income if you are permanently disabled and can’t work.

Life insurance is sometimes offered. But the truth is, the levels aren’t high, and you can do better securing this sort of thing on your own.

You can find all these on your own through ACEP at group rates, or through a good benefit agent. Paid vacations are also primarily a thing of the past, with most groups and employers working the vacation leave into the schedule. Another true value is CME stipend which should be at the $5K level each year for the private sector, without paid time to take it. Finally, that malpractice coverage is the last thing you want to ignore. Make sure it is at least $1MM/$3MM and that tail is provided, or at the very least, earned over time.

Next month

In May, we’ll look at true values in the prevalent incentive income packages and the essential pension/retirement programs.

Barb Katz is the owner of The Katz Company EMC Inc., an emergency medicine consulting and recruitment firm. She has been writing about emergency medicine careers and teaching effective job searching to residents for nearly 20 years. She can be reached at katzco@cox.net.

[Editor’s note: This is the first of a two-part series examining each part of emergency physician compensation packages.]