The effects of the current and looming physician shortage are readily apparent in the healthcare industry. When it comes to physician availability, patients aren’t the only ones struggling to find a provider. Healthcare organizations are also finding it difficult to hire the most desirable physicians due to an extremely competitive environment – especially when it comes to primary care physicians. In addition to offering attractive base salaries, it has become commonplace for organizations to include hiring incentives in order to procure the best candidates.
According to a 2018 report by the Medical Group Management Association (MGMA), compensation for primary care providers rose more than 10% in the previous five years, almost double the increase seen in specialty fields. The report, which used data from over 136,000 providers across the United States, showed median earnings of $257,726 for primary care physicians, and $425,136 for specialists. Organizations must stay abreast of current compensation trends for the positions they wish to fill – to attract the best candidates, offering a competitive salary is paramount. In addition to specialty, geographic location is an important variable when determining compensation. The top-earning states for physicians are Indiana, Oklahoma, Connecticut, Wisconsin, and Nevada, while the lowest-earning states are Michigan, Massachusetts, Hawaii, New Mexico, and Maryland. In most industries, urban areas offer higher salaries, but that’s not always true in healthcare. For example, the median income for an anesthesiologist in a non-metro area (defined as an area with a population of 50,000 or less) was $469,057, nearly $25,000 more than the median income of anesthesiologists located in urban areas. With some exceptions, most specialists in rural locations can expect to make more than their urban counterparts. Specialty, geographic region, and location all play a part in determining what constitutes an attractive and competitive compensation offer.
When recruiting physicians, examples of typical incentive offerings include a signing bonus, continuing medical education (CME) support or reimbursement, and a relocation allowance. According to MGMA’s DataDive Provider Compensation database, which represents 147,000 providers in a variety of specialties, the most recent median signing bonus for a family physician without an obstetrics certification was $28,000, the median amount for CME support was $2,750, and relocation allowance was $7,050. For physicians specializing in internal medicine, the median values were as follows: a signing bonus of $20,000, CME support of $3,500, and a relocation allowance of $7,800. While these numbers reflect the median values of various specialties, we’ve also seen signing bonus amounts of up to $50,000 and relocation allowances ranging from $10,000 to $20,000, depending on the specialty and the desirability of the candidate.
Organizations who wish to hire a resident or fellow once they complete their training may offer a monthly stipend as a hiring incentive. Typically, a monthly stipend offer is contingent on an early signing commitment and can range from $1,500 to $3,500 per month for the remainder of their training. When it comes to recruiting younger candidates right out of residency, loan repayment programs are also a very desirable incentive. According to the American Association of Medical Colleges, the median amount of loan debt for recent medical school graduates was $200,000. Typically, organizations will pay a monthly or yearly sum toward loan repayment in exchange for the candidate working full-time for an agreed-upon amount of time. One example: When seeking physicians to fill rural job openings, Banner Health, a nonprofit healthcare system, offered $100,000 in loan repayments over five years. Some healthcare systems also offer a retention bonus where the physician receives an agreed-upon amount ($25,000, for example) after each year of service to an organization.
There is no one-size-fits-all approach to determine the best hiring incentives and amounts; much depends on the type of position, organizational resources, geographic location, and the individual candidate. At Jordan Search Consultants, we spend time getting to know the organizations we recruit for – and the candidates we recruit so that we can help develop innovative recruitment packages that attract the best candidates. For help and insight on finding and hiring the right provider for your organization, email us or give us a call at 866-750-7231.