Contract/Partnership Questions

[Zie]

I am a soon to be newbie attending (188 more days to go, but who is counting) and am starting to evaluate job offers. Looking for my "first grown up job". I have an offer from smaller group and a larger group in my area. There are definate advantages/disadvantages to each.

I am very familiar with the small group as it is where I trained, but downside is it is where I trained and I may always be considered a resident. Average pay, no room for advancement, small group, 2 years to partnership with no buy-in. Partnership means only meager increase in salary.

The larger group offer has LOW starting salary year 1 with progressive increases to year 5. They have a crazy bonus structure that appears very lucrative and will help far surpass the pay of the smaller group if all pans out. There is also an option of buy-in for shareholder at year 2 and year 5. This would allow me to spread my wings a bit and get out from under the residency umbrella.

Crunching numbers and assuming bonuses: If everything pans out the way the interviews said, I would make equal total money by year 3 or 4 at either job. Calls/Vacations are similar.

I guess that I am just looking for advice. Both groups seem to retain employees. Location is much better for one job. I have personal issues with evaluating a job assuming the bonuses to be income, b/c they are not definate pay. Is there a possible benefit for working for the group without buying in, or would it be better to be a shareholder. Lots of questions and they are all starting to make my head hurt.

Any advice from some of you whom have experienced and lived this all before would be much appreciated.

Zie

---

Members don't see this ad.

 

[2ndyear]

How much is the buy in? That may have some bearing on your decision, and did you get an idea of how much the partners/shareholders are making after, say, 5 years? Out here it's uncommon to buy into a group with money, we generally pay with time (and reduced salary) only, but I understand this is regional and more common in the West.

You also mentioned location. Location is huge in my mind. If you're not happy with location (and more importantly if your significant other isn't happy...) then 'nuff said. Search is over. Take the pay cut and deal with it.

 

[Zie]

They suggested that after 5 years, most will bring in 450k without being shareholder. But again just over 1/3 of that would be in the form of bonuses. Could they be deceiving me/exaggerating? Yes they could. Said buy in was around 40K total.

The Chief seems to be nice and forthcoming, but I suppose I would just be more comfortable with more salary and less bonus.

 

[Lonestar]

Everytime i hear bonus, i immediately think "maybe." 1/3 of your salary seems to be a huge percentage of your salary in bonus. I would be very hesitant about this.

I joind a group that covers 2 hospitals. I take call at one hospital and cover the other during non-call days. I am in a employee non-partnership track position. 3rd yr is pretty much partner salary. Salary is nice and not too confusing. On top of that, they allow me to take call (for extra pay) at the other hospital. My salary has already gone up by 15K by just doing this and taking home call. Vacation/timeoff is equal from day one.

Personally i am happy with my scheduled payments and don't have to worry about buying in and rest of the mess.

Just assume that the bonsues are not there and approach it that way. 5 yrs seems like a long partner track. If you squint your eyes enough, even the ugliest girls look preety. Same goes for this job.

 

[leaverus]

If you squint your eyes enough, even the ugliest girls look preety.

Um, i've tried that - doesn't work. It makes the pretty girls look ugly though.

Anyway, i'm really bad about this kind of stuff - is there a FAQ somewhere related to basic questions regarding jobs/ payment structures/ contracts/ partnerships. What exactly is "buy-in?" Is it pretty much what it says, you have to "buy into" the partnership via $$? Are all groups like that? Why does such a thing exist? Isn't your sweat and tears for the first couple of years enough?

 

[bubalus]

Anyway, i'm really bad about this kind of stuff - is there a FAQ somewhere related to basic questions regarding jobs/ payment structures/ contracts/ partnerships. What exactly is "buy-in?" Is it pretty much what it says, you have to "buy into" the partnership via $$? Are all groups like that? Why does such a thing exist? Isn't your sweat and tears for the first couple of years enough?

The ASA sends out a book about beginning practice. Talks about contracts, insurance, etc.

One way of looking at a buy in is this: You're joining a group of physicians who have spent years developing a profitable relationship with a hospital. You haven't contributed at all to that, so you shouldn't reap the same benefits right away. The group also wants a period of time to make sure you are a good fit. Buy ins usually involve time and money. Some groups take a percentage of your take for the first few years. Others may take a lump sum at the end of the buy in period. Some may do both. The buy in is frequently distributed to the partners (remember when you become a partner). The time factor varies from group. Some may be one year, others more than that. Five seems really long. At the end of the buy in typically comes the possibility of partnership. You don't want to give up 25% of your take for the first two years to buy into a group that won't make you partner (assuming you're competent and deserve partnership).

What happens when you leave a group you've bought into? Is there a buy-out? Probably not.

What happens if you don't make partner? Do they give you the buy-in back? Not a chance. You get to go on to another job with another buy in, plus you may have to buy tail insurance on top of that.

That five year gig sounds concerning to me. Five years is a long time in this market. You better make some big bucks in a very desirable area with a ton of vacation if you're going to go through that. Having a huge percentage come from bonuses is an easy way to get screwed out of 1/3 of your salary. The buy-in at years 2 and 5 sounds like a multi-level partnership thing which can also be very concerning to me. I'd definitely talk to people who have left that group and who didn't make partner. It would really suck to not make partner (or be stuck as a lower-level partner) after a 5 year buy in.

Some groups may make you a partner immediately. They usually really need someone. Others may not require a monetary buy in, but would grant voting rights with partnership at a certain time. It's probably fair to say that most groups will require some sort of buy in. If I were looking to screw a new hire for a few years, I'd want the longest track with the biggest buy in that I could have and still get decent applicants who would stay through the whole buy-in time.

 

[JP2005]

this job sounds like a NAPA job i interviewed with a few months back on Long Island

 

[Mista Suprane]

this job sounds like a NAPA job i interviewed with a few months back on Long Island

JP you are too grimey to get a job anyway.