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Salary One Part of the Compensation Package

Salary One Part of the Compensation Package

I am a senior medical resident who intends to start a new job as a hospitalist later this year. I have been interviewing and feel fortunate to have several offers of employment. Is there anything I should be looking for in employment contracts?

M. Berkowitz, DO, Manchester, N.H.

Dr. Hospitalist responds:

Congratulations on your graduation, and welcome to the rest of your career. I have worked in HM for more than a decade. You have made a wonderful career choice; there is no better time to be a hospitalist.

Selecting the right job is important. I recognize it’s not easy to determine the best employer for you. All too often, I hear about physicians taking a job because the employer offered the highest salary. Money is important, but it’s not the only variable you should consider when sorting out offers. I have no formal training in human resources or employment law, but I have been hiring physicians for more than a decade, and I believe there are very important elements of compensation in any job offer aside from salary. For example, benefit packages and benefits costs to the employee and employer vary from job to job. Some employee benefits cost the HM group 25% of salary. Compare a job offer with paid benefits to a job offer with a similar salary and no paid benefits. When you do the math, you’ll understand why salary isn’t the only variable you should consider.

Take time to understand retirement plan offerings, including the short- and long-term implications. Some employers offer pension plans; most offer access to 401(k) or 403(b) plans. Some employers match employee contributions, while others do not. Over the long term, match programs offer a huge investment advantage. However, it is important to know the terms of the plan—namely, the vesting period. The vesting period is the number of months or years an individual must be employed to qualify for matching contributions. Ideally, you want a retirement plan that vests immediately.

Another important benefit is malpractice insurance. Do not assume that your employer will provide malpractice insurance at no additional cost to you. Do not assume that all malpractice insurance policies are the same. Most policies provide a monetary amount of coverage for each incident with an annual aggregate limit. For example, a 1/3 policy covers up to $1 million per incident and up to $3 million in annual aggregate. Higher amounts of coverage will offer greater protection against high-dollar verdicts but might make the insured an attractive candidate for litigation in the eyes of some plaintiffs.

Most hospitals require that physicians carry a medical malpractice policy with a minimum amount of coverage before they grant privileges. Some policies, such as occurrence policies, provide coverage for incidents that occur during your period of employment, even if you leave your job.

Claims-made medical malpractice policies typically are less expensive, but they will not provide coverage after you leave an employer unless the policy includes “tail coverage.” If you have a claims-made policy, I urge you to consider purchasing tail coverage. The take-home message is that medical malpractice insurance should be figured into your employment decision.

Also consider whether prospective employers offer signing bonuses; reimbursement for continuing medical education; and health, life, disability, and accidental death and dismemberment insurance coverage for you and your family. I suggest you examine the language of each individual insurance policy to understand what coverage is offered.

Perhaps the most important piece of advice I have for you is to retain the services of a healthcare attorney. Make sure this person is familiar with physician employment agreements in the state where you plan to work. TH

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