Help with a PP offer

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eeor1006

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Hi all,

Newly licensed ECP here. A group practice recently made me an offer: 55/45 split, no benefits at all. They offer office space, receptionist, teletherapy program, medical billing, phone answering, referrals, testing materials, EMR, and marketing. They will also help me get paneled with all the major insurances. I will get to choose how many hours I work and when I work. I spoke with several psychologists who are working/worked there and they all seem to like the practice owner and manager. The practice is pretty established in the area and has a good reputation.

My first reaction is to turn it down. The split is lower than I anticipated. Since I'd like to do 100% virtual therapy at this moment, I wouldn't need office or receptionist. The biggest perk they offer is that they seem to have a steady flow of referrals, which would be nice. Your thoughts?
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Walk! I just quit a similar split. It's not worth it. Ask for a more equitable split and see what they say. If they budge it might be worth pursing. But if not, the owner is probably a cheap, penny pinching, jerk who wants your income without your liability for trinkets.

Keep in mind, when talking to other people there, you're also dealing with survivors bias.
 
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I agree, there'd need to be some pretty extraordinary benefits to justify a 55/45 split, and it doesn't sound like there are. I would walk. Briskly.

I mean, if you were seeing all of your patients in another state and they were having to fly you out there twice a week and put you up in a swanky hotel while covering all of your meals every time, maybe? Or if you were unlicensed and they weren't able to bill for a bunch of your work.

You could try negotiating, but when that's their starting offer, I honestly don't know how receptive they'd be to a more equitable split.
 
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If all you are doing is virtual therapy, there is no reason to give up 45% of your reimbursements just for referrals. Now is a very easy time to get patients. Join your state psych association, many have listservs where people put a call out for referrals all the time. Ours has had about 5 people looking for providers so far today. Meet with certain clinics who see the patients you cater to (e.g., psychiatry/med mgmt PP, primary care).
 
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Let's assume 40hr weeks, 50 weeks per year. That's 2000 hours at work per year. Then let's assume that 25% of that time goes to no shows, gaps in schedule, admin work, IT problems, eating lunch, going to the bathroom, and times when insurance doesn't pay. That leaves about 1500hrs of revenue generating work per year. Now apply the CMS fee schedule for psychotherapy , at $103/hr. Now apply the split... you'd be making ~$56/hr. Annual income before taxes and expenses would be $84,000.00. From that you'd need to pay your own health insurance, malpractice insurance, disability insurance, and self employment tax.
 
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PsyDr said:
Let's assume 40hr weeks, 50 weeks per year. That's 2000 hours at work per year. Then let's assume that 25% of that time goes to no shows, gaps in schedule, admin work, IT problems, eating lunch, going to the bathroom, and times when insurance doesn't pay. That leaves about 1500hrs of revenue generating work per year. Now apply the CMS fee schedule for psychotherapy , at $103/hr. Now apply the split... you'd be making ~$56/hr. Annual income before taxes and expenses would be $84,000.00. From that you'd need to pay your own health insurance, malpractice insurance, disability insurance, and self employment tax.
Click to expand...

In other words "congrats on making less than many midlevels!"
 
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Painting this fence is awful fun. No way I would let any of you do this....
 
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Thanks everyone! Wow, I knew it was bad, but not this bad. The numbers laid out by psycdr really put things into perspective for me. I think I will keep looking or go into pp on my own.
 
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borne_before said:
What if I gave you a bite of my apple?
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Mr Miyagi had a better racket. Have Daniel-san paint the fence and wax the car while charging for karate lessons. I have considered suckering some people into doing yard work for me by calling it outdoor crossfit and charging $40/each for a group class.


OP,
Agreed with the others that it is a bad deal. That said it can be par for the course in many areas. Remember to check for non-compete clauses and such. While they not enforceable generally, you don't want to have to go to court and spend thousands on a lawyer. If you have to take such a deal so you can eat/pay bills, make sure that you can easily shift into your own practice without restrictions later on. Good luck.
 
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I was something like that while post-doc. Then was 70/30 contract at the same place when licensed. Fascinatingly the owner offered 50k flat with no benefits to go full time employee/clinical director. It blew my mind. I stayed at 70/30 and they attempted to cut my split down twice, saying I was seeing too many clients and they couldn’t afford me at that level. Of course cutting someone’s wages because they are too productive, reliable, and focused on your business, and are making you too much money, and when you don’t have enough staff to reassign folks anyway is a fairly novel concept IMO. You don’t need admin, office space, referrals or their BS. Frankly I wouldn’t do it for a 90/10 split in this environment… Go solo or build out a group, stay away from the folks eating their own…
 
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PsySeeker said:
I was something like that while post-doc. Then was 70/30 contract at the same place when licensed. Fascinatingly the owner offered 50k flat with no benefits to go full time employee/clinical director. It blew my mind. I stayed at 70/30 and they attempted to cut my split down twice, saying I was seeing too many clients and they couldn’t afford me at that level. Of course cutting someone’s wages because they are too productive, reliable, and focused on your business, and are making you too much money, and when you don’t have enough staff to reassign folks anyway is a fairly novel concept IMO. You don’t need admin, office space, referrals or their BS. Frankly I wouldn’t do it for a 90/10 split in this environment… Go solo or build out a group, stay away from the folks eating their own…
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RE first bolded point: ...as in, just a 50k salary (without benefits), or 50k on top of some other amount? And they legitimately expected you to take that?

RE second bolded point: yeah, if they somehow can't afford you because you're seeing too many patients and collecting too much money, sounds like they're doing something wrong. Or they're full of it, of course.
 
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AcronymAllergy said:
RE second bolded point: yeah, if they somehow can't afford you because you're seeing too many patients and collecting too much money, sounds like they're doing something wrong. Or they're full of it, of course.
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It's they're deceptive way of saying that they're losing out on significant money they'd earn if those patients went to one of their other providers who took the sucker's split.
 
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AcronymAllergy said:
RE first bolded point: ...as in, just a 50k salary (without benefits), or 50k on top of some other amount? And they legitimately expected you to take that?

RE second bolded point: yeah, if they somehow can't afford you because you're seeing too many patients and collecting too much money, sounds like they're doing something wrong. Or they're full of it, of course.
Click to expand...
Yes, 50k flat, nothing else. It was surreal.
 
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psych.meout said:
It's they're deceptive way of saying that they're losing out on significant money they'd earn if those patients went to one of their other providers who took the sucker's split.
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Oh that was it for sure, mainly to the free labor that was carrying a huge amount of the total caseload (ie prac students) that they expected me to supervise four of for like $40 bucks a week each). Thing is, they didn’t even have students with any capacity at the time, just greed and/or some very strange ego stuff. Tip of the iceberg stuff though really. Was a total 💩 show.

I love having my own practice. Truly. I have zero intention or desire to ever work for someone else’s entity/interest ever again.
 
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