Employed Physicians Benefits
I fully understand why choosing to be an employed physician is the preferred model for the majority of doctors, including over 90% of recent residency graduates.
Employment is turn-key, guaranteed income, and often laced with signing incentives.
Employed Physician Pain
I have been an employed physician for over 20 years. Sooner or later most employed physicians come to the realization that the ease and security of the position has a painful backside that includes losing professional and personal control over your life.
This pain can leave physicians in a position to consider making a change that helps ease the burden. That Y in the road occurred for me 10 years ago, as I teetered on the edge of burnout. There were seven in our highly successful group at that time, and we all went different directions as a result of employed physician burnout issues.
Summary of Options
The following is a summary of the options I considered at that time, and are the same options available to you:
1. Leave medicine altogether
Your identity does not have to be defined by your education. Choose something that gives you meaning and purpose. If medicine is unfulfilling, you don’t have to stay in it.
If you are unsure, take a sabbatical from medicine. Step away for a season, and do some personal inventory to reflect on what you are passionate about, and what your ideal world would look like.
With your education and degree as a physician, you have many options.
Don’t let income and lifestyle preferences force you to live miserably. Nor let the guilt of “not using your degree” impair you from pursuing your passions.
2. Migrate to Private Practice
You will maximize control of your professional life the most with this transition, especially if you open your own practice.
One of my close friends and fellow physicians in our practice chose to leave the group, during the same Y in the road. He landed in industrial medicine, but has now transitioned to his own Direct Primary Care private practice. He loves it.
But one must be mindful this transition requires the most time, energy, and resources of any of the 5 options.
3. Change Jobs
Find a greener pasture that promises to have offer you a more benevolent employer, complete with more professional autonomy. When our group broke up, a few of the doctors chose this route. Ultimately my peers felt trust was broken with management, and typically when this bedrock element is fractured, it’s hard to recover with the same employer.
Moving on was best for both physician and employer.
Depending on where you live, this could require a stress filled household move as well. Don’t minimize or monetize the price of this change in your household. The change may be best for you professionally, but it may come at a significant personal cost to the members of your home.
4. Become A Medical Contractor
You can box in your work life, and create space for personal interests by moving to shift work for contracted services. There are a host of short and long term options for this type of work depending on your specialty, but the most well-known option is specialty-specific locum tenens positions.
Many acute care hospitals offer a wide range of contracted service positions for the myriad of medical services provided at their facility. Transitioning from an employee to a contractor can provide a needed infusion of autonomy.
Two members of my group chose to go this route. They took jobs in industrial medicine that allowed them to work Monday through Friday 9 am-4 pm, no call, no weekends or holidays, slow pace, and no messing with insurances.
Most contracted doctors are self-employed, but some work as members of a group organized to provide contracted medical services.
5. Employment Lite
This is a version of contracted professional services. It is technically a PC-PSA contract
Visually a standard employment contract looks like this.
In this model you receive a W-2 from your employer controls almost everything except the dollars that land in your household after they filter through your benefit plans and taxes.
Visually an Employment Lite or PSA Contract looks like this.
In this model you receive a W-2 from your own Professional Corporation (PC) while your PC receives a 1099 from your employer. You have now gained greater control over your personal and professional life. Your dollars are filtered strategically through your business and household so that the benefit plan and tax strategies are maximized to your individual needs. Additionally this provides the optimal business structure for adding professional side hustles to your PC’s professional services contracts.
This is where I migrated to and I love it.
Employed Physician Blind Spot
Although it is lesser-known, I believe it to be a great fit for many physicians who prefer the safe harbor of employment.
Most physicians don’t know about it for a couple of reasons:[the_ad id=”471″]
- It is a hybrid of options 1, 2,3, & 4. Thus it is a bit more complex and works best under the guidance of experienced agency.
- Many healthcare employers are unfamiliar with it and therefore don’t offer it in their standard boilerplate contract menu. As you probably know, creativity in contracting for physician employers is often considered too risky due to federal compliance issues.
Why I Love “Employment Lite” as the best option for regaining personal and professional control
1. It allows you to keep your current job, and not have to move or change employers.
2. You increase your professional opportunities and personal benefits far beyond the rigid structure of standard employment.
- You form your own Professional Corporation business in order to contract your professional services through what is called a PSA
- Your PC is paid by your employer typically in a productivity model, or salary.
- Your own PC pays you a salary
- Your own PC controls and provides your highly individualized benefit package.
3. You are not responsible for the operation of the medical practice in most cases, although this can vary based on the contractual arrangements.
4. Through the PC, your professional and personal cash flow becomes co-mingled in order to maximize your net worth.
5. You can outsource the business management of your PC to an agency of your choice for services that include (I would recommend this in order to simplify things):
- Benefit plan creation and management
- Tax, accounting, payroll, and book-keeping
- Retirement and investment management
- Contract formation and negotiation
- Legal counsel and compliance for the business
6. You dramatically increase your retained income under this business structure due to cash flow management. Without doing any more work for your employer, your net annual income typically increases by $50,000 or more.
Visually Employment Lite looks like this
I urge you to make a change before the burdens of physician employment send you down the path of burnout. There are many options available to you, and employment lite might be the logical pivot to make as you seek to regain professional and personal autonomy.
Dr Inc.
