These are just a few random thoughts in the era of Covid.
(1) In normal times and busier case loads its almost always a win for the owner to have the associate see patients unless volume is fantastically low. These are the sort of situations where the owner says variations of - "I have to see all the patients". That makes "no base" situations trickier. Not a lawyer - probably beneficial to have a short time table escape hatch in the contract. The last thing you want is to be trapped in some sort of 3 months scenario where you aren't being paid at all, no base, seeing no patients - waiting to quit.
(2) Does the person in question have a family? Benefits in podiatry practices tend to be sparse. For example, my health insurance is paid for as an employee of the practice. My family is also on the plan, but the payment for them comes out of my salary. That comes out to about $1000 a month - if you have no collections/base/guarantee - how will that be paid for?
(3) There is some relatively decent information on this forum if they look around for it though its a little all over the place.
(4) Be careful that the owner doesn't try and say - well you are actually a contractor as opposed to a W2 employee due to the no-base. There are variations of pros and cons to each, but contractors pay both sides of social security (like another 6.5% tax). They do have the ability to have a solo 401k. My big issue with the contractor offer whenever I hear about it - everyone always seems to get offered a usual podiatry bullcrap collections percentage even though their expenses will be substantially higher since they'll pay more taxes and have to pay for their own benefits. A contractor needs to be paid substantially more. Additionally, the way most podiatrist owners run their practices and treat their associates is not how the relationship with a contractor works. Contractors work for multiple people. They take work where they can get it. They don't sit for hours not getting paid 5 days a week in someone's office.
(5) You will inevitably receive some feedback consisting of the following:
(a) the northeast sucks
(b) hospital/multi-specialty pay is better
(c) private practice is awful
We have a vibrant and opinionated community! All of the above are true
(6) No matter the "generosity" of the % collections in a no-base situation - your friend will need a plan to deal with the fact that they may not have any substantial cash flow for several months. I looked back at my billing quite a bit when I first started and while ultimately we did collect the majority of our "allowed" it still took quite awhile for money to come in. Consider a claim through private insurance. Perhaps the patient pays a $40 co-pay. You charge an E&M and X-rays. The billing has to go through the insurance company, who reduces the fee schedule to the allowed amount, who then potentially passes the unmet deductible portion to the patient, who then maybe, eventually pays it. That isn't a 2 week turn. In fact, that patient may return for a 3 week follow-up and the insurance company still hasn't adjusted the visit - so you can't even say - oh btw, you have a $85 balance from last time, would you like to pay that today.
During that time your friend will have student loan payments, apartment/mortgage bills, etc.
(7)
-Bases/guaranteed salary are all over the place. I've seen $65, $75, $100, $120, $145(k). Others will know of different variations/values etc. If you are sitting at $120K base that's probably about as good as most people get. Not saying better isn't out there. But believe it - sub-$100K is and it isn't always associated with higher % collections amount.
-% collection values tend to be much lower in podiatry than other professions. I was offered 17% once. Probably normal spectrum of values is 30-40% with anything breaking 35% being considered decent as compared to what most have. A poster on here has advocated that more than 40% should be what you fight for. Most I've seen anyone get was 40% (and they actually had the best base I'd seen).
-We could draw a line in the sand and say anything under 30% is unacceptable/terrible, but the simple truth is someone else could come along and say the same for anything under 35%.
-With "no base" - I think I'd ask for 40% (someone may come along and say 42-45%). Course the higher you ask the more likely the pod is to ask their friends what they are paying and tell you that you are crazy. To which you say - you aren't paying me a base. I don't work for free.
-Probably would also be helpful to have an occurrence malpractice policy so that when you have to quit because you never got paid there is no tail.
(8) Podiatrists do have a tendency to create bullcrap salary tiers in which people make less money the harder they work. With a no base the tiers either need to not exist or get substantially better with each level.
(9) Podiatrists also have a tendency to want to with hold percent collection money until the end of the year, call it a bonus, and string you along on your base. If your salary specifies 35% etc - and the money you'd ultimately be owed for that exceeds your base - that's not a bonus. In a no base situation you must absolutely be paid your % collections throughout the year. The owner can sort his bonus out at the end of the year. Throughout the year the associated should be able to receive timely information on their collections - on the whole and from each patient so they can adjust/modify their billing.
(10) Your friend must absolutely have a lawyer review their contract. That said - a friend of mine had a lawyer review theirs. The friend had been told all sorts of things by the practice owner - an almost endless litany of verbal promises were made and none of these were in the contract. The resident attempted to provide feedback from their lawyer and the offer was rescinded. You must use a lawyer, but private practice owners are often not going to negotiate. My personal contract experience was that the owners accepted almost none of my modifications.
(11) Your friend should temper their expectations concerning how their future private practice will be. The people who trained me were I think very successful - hospital based, practicing essentially full spectrum, reasonably interested in billing and coding/adopting their practices - collections exceeding a million each. I met many successful people during 4th year - young doctors a few years into their practice busting their tails with collections approaching a million. I think there are plenty of practices out there whether the doctor thinks they are working hard and potentially their collections are only $400ish. A person like that can't pay a base of $120K. They can't image paying a collections percentage of 35% or more because often their overhead is 65% or more.
(12) Get all the "benefits" and costs and what not sorted out/detailed and have the owner spell out their interpretation of what it actually means to be paid a % collections - how does that work, what counts towards it ie. E&M, X-ray, CPT, DME
-There's been a bunch of crap lately of people being offered contracts where they had to pay their own malpractice
-A lot of owners are conniving bullcrappers who will try and manipulate what collections are or state that practice overhead expenses are yours etc. ie. well after the collections are added up we subtract the secretary overhead cost before we multiple by the %#. Bullcrap.
Good luck to your friend.
