Recently, we went through an intense round of salary negotiation with one of our docs. Previous employee physician negotiations had gone smooth. But this time, it was much more challenging.
Our approach was to offer well-balanced work and life proposition that not only maximized the physician’s salary, but also created a financially strong, healthy organization. The compensation structure was transparent, rewarded hard work, encouraged initiative, and motivating for the physician.
According to the physician, our plan actually did the opposite.
Back to the drawing board
Being wet-behind-the-ears about physician compensations, there was a need to learn more about this topic in an effort to find a comp structure that met both party’s expectations.
I knew this was a common issue in medical practice, so I assumed that somebody had to have the answers to our question: What is the best compensation model out there for a private practice physician?
I delved into the MGMA’s physician compensation surveys, bought the MGMA’s Physician Compensation Plans: State-of-the-Art Strategies, and reached out to my smarter group of friends I know for advice.
I searched online, probed, inquired, studied and read everything I could find in an effort to address the different issues. Surely someone had already created a physician compensation model that would achieve the results we were looking for. And I was bound to find it. I was confident I was going to find the answer.
I did find it.
I found the best comp package ever.
And I have the secret as to how you too can create the best compensation package ever.
Do you want me to share it with you?
OK, here it is:
The best comp package is the one that you create. Therefore, the secret lies within you.
Insert sad trombone.
Disappointed in the answer? I was too.
I felt like the main character in the movie Kung Fu Panda when he finds out that the noodles his dad makes didn’t have a secret ingredient. Po says, “Wait, wait… it’s just plain old noodle soup? You don’t add some kind of special sauce or something? His dad responds, “Don’t have to. To make something special you just have to believe it’s special.”
After spending about six-months on this quest, you know which comp package we selected? The very one we had offered to the doc at the beginning of the negotiations.
Why? Because after this process it became painfully aware that there wasn’t a perfect system. And I realized our comp structure was just as good as any of the ones out there.
I found out that every comp structure has its pros and cons; therefore, everybody tweaks them to address the issues each practice thinks is a concern for them. Consequently, there are probably as many compensation structures as there are doc’s.
Thus, the one we had put together was in fact the best comp package for our practice.
It was necessary
The process challenged me as a practice manager. In fact, I even lost sleep because of it. But the process help me gain a better insight into our practice. I had to further understand our cost, our potential earnings, as well as, our practice’s philosophy, hone our vision, and decide what was important, what were the priorities.
However, although I did find the best compensation package for our practice, that does not mean it will always be the one. I still think it is important to continue to study, to inquire, to discuss and to read all the different resources out there and continue tweaking it. But the lesson I’m taking away here is how I frame the issue. I now know that I’m not going to find a pot of gold, so to speak, at the end of the rainbow. Now I’ll produce our pot of gold and take it to the end of the rainbow.