Actually, you buy in usually as a partner, which becomes a capital contribution toward your group, which is a partnership (corporation). They then pay your buy-in amongst themselves as a distribution, which after write-offs is pretty close to tax-free. You're actually paying them three years worth of "buy in" if you look at it that way when you include the first two years of reduced pay plus your lump sum.
Some other groups might take your buy-in and add it to the partner bonus pool, which might be paid quarterly, which means you (as a new partner) will get a portion of your money back in the form of a bonus.
Greed can be a motivating factor even with small groups. The more physicians they add, the more it dilutes their bonus pool. Be weary of groups that require more than one year of a partnership track - it usually means they are hoarding as much as they can. The typical accounts receivable (the amount the group has billed from your work but not collected) is 6 months behind, which means after a year of time, you should be generating them revenue even if you were paid at their same salary. Your lower salary accounts for their short-term loss which they keep anyway in the form of your AR.
They benefit from people not making partnership in two ways 1) you work two years for a lower salary and leave, and 2) after you leave they get to keep all of your AR. When shopping for a partnership job, it can be fun to see how they react to your question about who keeps the AR. If you are an independent contractor, you might have a claim to it. This is one reason the employee model can be popular with partnership track physicians.
CMG's are not without their pitfalls, but they infrequently pay a higher rate than someone on the partnership track, even as an employee. I would guess that for a five-year period, for those on a partnership track versus those who are strict CMG workers, it's pretty close to a wash for net income.
The groups that don't tell you what you will make as a partner usually have four things they are hiding:
1) The fact that they don't plan on making you a partner
2) That partnership bonus is not much and will actually put you slightly above or just at market average for your area after your buy-in period
3) There are many tiers to partnership level, and they are accompanied with many additional responsibilities (i.e. reduced clinical hours PLUS mandatory administrative work or committee service). Only the top three holders of the corporation make the big bucks and control the show.
3) The group is in trouble.
Be weary and run the numbers. Also, call around the other groups in the area where you want to work. Use them as references for your potential group's reputation. Directors and groups have local history, and often you will learn more about the "partnership" from those who are local and outside of the group. There is a group local to my practice that is known for voting on "partners" and actually using a fraternal type of "black ball" system. If one partner blackballs any physician at any time during their partnership track, they will never be offered partnership - even if it is your first shift working with that partner. They have let numerous people go at the two-year mark and in the past 7 years, and after countless "partnership track" physicians, have never added a partner. They continuously market themselves as 99th percentile for pay. Wonder why...
. The dystopia presented in the book has to be a bit overblown, but it was enough to freak me out a bit.
