Recent trends in the practice of medicine have been shifting from a predominantly private practice model toward an employment model. Many factors are driving this. The popular emphasis on work-life balance has promoted the impression that it’s better as an employee, which is not necessarily true. Skyrocketing debt from training is making doctors reluctant to lay out money to buy into a practice. Healthcare reform has created uncertainty about how the industry will be affected, making a salaried position look more attractive.
I have practiced in both models, and experienced the good and the bad each has to offer. This is the second article of a four part series comparing the differences. Weigh the pros and cons of each before making your final decision.
Fewer hassles
As an employee there are none of the hassles of running a business. That responsibility is someone else’s. Your boss will do the hiring and firing and make all the business decisions. You can focus on the practice of medicine.
Practice viability
As an employee, you have a guaranteed income with no concern about your patients’ ability to pay or their insurance status. You also have no worry about having enough patients. You will not need to advertise to boost your patient volume. You don’t need to concern yourself with billing and collections. You only need to cash your paycheck. If the area is financially depressed, you may make more money being employed, as the hospital may subsidize your salary to keep their doors open.
No overhead
As an employee, you have no additional costs. You won’t be buying into a practice, which may be a significant benefit if you have lots of debt and no money in the bank. You won’t need to buy your share of the building, or purchase any equipment. There are no overhead worries. You even get paid vacations.
Higher initial salary
Employees usually get paid a higher income at first and it usually doesn’t grow much from there. This is one of the things new doctors notice right away. Starting salaries as an employee tend to be higher. In fact, if the organization is in great need, the starting salary could be outrageously high.
Flexibility
Leaving an employed position is often easier. You won’t have a buyout agreement. You can give your notice and leave. Sometimes there may be something you need to pay back, if you leave too early. But if you are struggling with the decision of where to live, the option of an easy exit may be a real benefit if you find you picked the wrong practice to join.
Automatic referrals
As an employed physician, you often walk into a situation where good patient volumes are a certainty. This is particularly true for a referral-based practice where the primary care physicians are also employees and are obligated by contract to send their patients to see you.
These are some of the most important advantages of being an employee. Next week’s blog will cover the disadvantages of owning a practice. Learn more in my book The Doctors Guide to Starting Your Practice Right.
Feel free to comment below if you feel I missed an advantage that is important to you.
