Private vs Hospital Employed

[PainApp2021]

Hi there everyone,

I learned last week that I will be joining your ranks as a pain doc as long as I don't get kicked out of my residency, and as long as I complete the fellowship I matched at. A little while back I had a fantastic job offer for a pain job after completing fellowship, however unfortunately my wife and I decided that the location was a deal-breaker (after Hurricane Ida) and I value her more than the $$$.

My question to you all:

Can anyone comment on what earnings as a "partner" actually mean realistically? Does it make more sense to work for five years as a hospital employee, have my 350k federal loans forgiven while earning ~400k/yr, and then make the move to a private gig? Or am I more likely to out-earn (470k averaged over five years) in private practice over the same time frame?

Also one additional question:

How early in the recruitment process do you ask about compensation package? I understand not wanting to come off as money-hungry, but at the same time I do not want to waste anyone's time (particularly my own) if they are going to offer 25% percentile or something similar.

Thank you

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[RoloTomassi]

Good question. It's hard to compare because hospital gigs and PP gigs both have a lot of variance. Are you sure you're going to easily find that? 350 forgiveness (no strings attached if you leave) + 400k? PP has so much variance. Some are slave labor for 3 years before potential partnership, some are partnership/ASC right off the bat or in 1 year.

Money aside, you have to assign value to intangibles--location, control over payer mix, patient population, staff, hours, procedure mix, etc. Lot of variance between hospital vs PP but also between each opportunity.

 

[PainApp2021]

Good question. It's hard to compare because hospital gigs and PP gigs both have a lot of variance. Are you sure you're going to easily find that? 350 forgiveness (no strings attached if you leave) + 400k? PP has so much variance. Some are slave labor for 3 years before potential partnership, some are partnership/ASC right off the bat or in 1 year.

Money aside, you have to assign value to intangibles--location, control over payer mix, patient population, staff, hours, procedure mix, etc. Lot of variance between hospital vs PP but also between each opportunity.

It is very difficult to compare- I agree! The PSLF forgiveness is if you are working at a non-profit 501(c)3, which many hospital employed positions are. There are no strings attached in that situation because the hospital itself is not actually giving you any of the money toward student loans.

 

[vit8bsm]

the first 1-2 years of private practice on your own you probably won't make over 250k because you'll be busy building the practice, getting patients, getting credentialed, figuring out how billing works etc, so would you rather make 400k for 5 years and then go into private with savings in the bank and loans paid off and take the pay cut for probably about 2 years? Or would you rather deal with that pay cut now and have a flourishing practice in maybe 2-3 years? PP is super variable, some doctors think anyone making over 600k is committing fraud, other's say if you're not making over 600k you're either lazy, inefficient or something along those lines so you should discuss with pain physicians in your area to see what type of income they're pulling in.

Personally I'd probably work for a year or two for a private practice to save money up, learn the ropes of PP pain etc. and then go out on my own.

 

[agolden1]

Also, this may depend largely on where you want to be and how things are looking in a year from now.

Current fellow in the job hunt. COVID has made a number of practices really tighten their belts. Looking at massive geographic swath. N=1, but…

Many private practices aren’t looking to expand, or if they are taking on a fellow aren’t really considering a partnership track. Many hospitals aren’t looking to expand with another pain physician including in fairly small towns. Hopefully it’s better in a year from now.

If you are geographically restricted, it may be a matter of taking on whatever happens to be available in the area until you can open your own shop.

I have a much longer post on this one after I actually sign some place.

 

[Iamnew2]

the first 1-2 years of private practice on your own you probably won't make over 250k because you'll be busy building the practice, getting patients, getting credentialed, figuring out how billing works etc, so would you rather make 400k for 5 years and then go into private with savings in the bank and loans paid off and take the pay cut for probably about 2 years? Or would you rather deal with that pay cut now and have a flourishing practice in maybe 2-3 years? PP is super variable, some doctors think anyone making over 600k is committing fraud, other's say if you're not making over 600k you're either lazy, inefficient or something along those lines so you should discuss with pain physicians in your area to see what type of income they're pulling in.

Personally I'd probably work for a year or two for a private practice to save money up, learn the ropes of PP pain etc. and then go out on my own.

Realistically though, what is the average pain salary these days even for those who do make it to partners? At the fellowship I did, all the docs were Independent contractors I think or employed but paid per collections - except for a few I don't think most of them pulled more than 300-400k. How many pain docs are truly making 600$k plus these days? This is an honest question.

 

[RoloTomassi]

Realistically though, what is the average pain salary these days even for those who do make it to partners? At the fellowship I did, all the docs were Independent contractors I think or employed but paid per collections - except for a few I don't think most of them pulled more than 300-400k. How many pain docs are truly making 600$k plus these days? This is an honest question.

Everyone I know who has been partner for 1 year+ makes >600

 

[Iamnew2]

Everyone I know who has been partner for 1 year+ makes >600

How many people are partners realistically? Of all the people in pain I know, not a lot are making 600k.

 

[Laryngospasm]

Realistically how would you know what your staff were making. Also academic docs are always underpaid and they accept it for the cushy job.

 

[gaspasser127]

Based on jobs I’ve been interviewing at i think PP guys who are partners are def clearing 600k or at least the majority of them are. This is in the mid-west and southeast.

Hospital employed positions are good but there is likely a ceiling for compensation that you won’t exceed without sketchiness. You can still clear 600k tho in certain parts of the country.

But really… the jump from fellow to attending salary is going to be the most consequential salary adjustment in our lives. Life is very different when you go from making 60k to 400k. I don’t think you get a whole lot more out of life going from 400k to 600k or even to 1M and the stress probably is overwhelming. Focus on your health and family.

 

[vit8bsm]

Realistically though, what is the average pain salary these days even for those who do make it to partners? At the fellowship I did, all the docs were Independent contractors I think or employed but paid per collections - except for a few I don't think most of them pulled more than 300-400k. How many pain docs are truly making 600$k plus these days? This is an honest question.

When I said PP, I should have been more specific. I mean you own your own practice. You're right, it's not common to join a practice on salary and get paid over 600k. Most pain doctors I know who own an office with a mid level or two helping with consults (doc doing all the procedures though) can comfortably make that if they're efficient and get enough patients. That comes with the headache of being a business owner, marketing yourself, creating relationships in your area for referrals, dealing with all the bull**** of owning your own office, dealing with insurance companies, bad employees, anything slightly unethical going on in your practice is on you... the list continues. You can make 300-500k for someone else and live a great, stress-free life without dealing of any of that previous BS, but for the docs who own their own office/clinic, c arm, have a mid level or two (for simple follow up consults, anyone having mid levels do their spine procedures or complex cases is crazy), maybe some ancillaries etc, 600k+ is very normal.

But again, the quality of life is drastically different, very few people can run a practice alone and don't age 2x as quick and start to hate their life. Is the couple extra hundred thousand worth that? From the various physicians I've met, I think that going the employed route makes sense for most.

 

[Iamnew2]

When I said PP, I should have been more specific. I mean you own your own practice. You're right, it's not common to join a practice on salary and get paid over 600k. Most pain doctors I know who own an office with a mid level or two helping with consults (doc doing all the procedures though) can comfortably make that if they're efficient and get enough patients. That comes with the headache of being a business owner, marketing yourself, creating relationships in your area for referrals, dealing with all the bull**** of owning your own office, dealing with insurance companies, bad employees, anything slightly unethical going on in your practice is on you... the list continues. You can make 300-500k for someone else and live a great, stress-free life without dealing of any of that previous BS, but for the docs who own their own office/clinic, c arm, have a mid level or two (for simple follow up consults, anyone having mid levels do their spine procedures or complex cases is crazy), maybe some ancillaries etc, 600k+ is very normal.

But again, the quality of life is drastically different, very few people can run a practice alone and don't age 2x as quick and start to hate their life. Is the couple extra hundred thousand worth that? From the various physicians I've met, I think that going the employed route makes sense for most.

It's hard to own and operate your own clinic in certain competitive markets int he country. In the Chicagoland area where I'm at, it's next to impossible. Some of the groups are so engrained and so old it's very hard for the new guy or gal to compete. Many are multi site places. There is an Ortho group here who has like 27 locations I think. How does one compete with that? And you are right owning a business is hard as heck, and there is so much overhead and so many headaches. It's hard to market yourself when there are 50 other doctors who do the same thing within a 10 block radius.

 

[RoloTomassi]

You don't have to go solo. When you have partners, you share overhead and administrative burden. A good practice manager/COO/CFO is like an administrative midlevel, and can deal with all the headaches for you, free you up to bring in more revenue than their salary.

 

[DOctorJay]

Everyone I know who has been partner for 1 year+ makes >600

What locations/regions?

 

[RoloTomassi]

What locations/regions?

Southeast

 

[vit8bsm]

It's hard to own and operate your own clinic in certain competitive markets int he country. In the Chicagoland area where I'm at, it's next to impossible. Some of the groups are so engrained and so old it's very hard for the new guy or gal to compete. Many are multi site places. There is an Ortho group here who has like 27 locations I think. How does one compete with that? And you are right owning a business is hard as heck, and there is so much overhead and so many headaches. It's hard to market yourself when there are 50 other doctors who do the same thing within a 10 block radius.

I don't disagree. That can be said for any business on the planet. Private medical clinics are no easier than most businesses. At the same time, I've noticed that huge, behemoth medical companies/hospitals/groups actually have a bad rep among patients. It's kind of why CVS hasn't killed off private pharmacies yet. Once you get big enough (8 and 9 figure valuation), practices tend to stop prioritizing about patient satisfaction and they focus on increasing revenues as they become more and more corporate. It's not impossible to outcompete them, but it definitely is very difficult. The longest wait times and worst patient service tends to be at the biggest offices and clinics (multilocation with tons of owners).

You don't have to go solo. When you have partners, you share overhead and administrative burden. A good practice manager/COO/CFO is like an administrative midlevel, and can deal with all the headaches for you, free you up to bring in more revenue than their salary.

A lot of people willing to manage a clinic full time are either 1) incompetent and not capable of producing more than their salary or 2) suspicious and scheme. It's possible to find a good manager and they're worth their weight on gold, but it's not easy at all. Most people who have good manager and people skills are building better careers than setting up a small doc office.

 

[Iamnew2]

I don't disagree. That can be said for any business on the planet. Private medical clinics are no easier than most businesses. At the same time, I've noticed that huge, behemoth medical companies/hospitals/groups actually have a bad rep among patients. It's kind of why CVS hasn't killed off private pharmacies yet. Once you get big enough (8 and 9 figure valuation), practices tend to stop prioritizing about patient satisfaction and they focus on increasing revenues as they become more and more corporate. It's not impossible to outcompete them, but it definitely is very difficult. The longest wait times and worst patient service tends to be at the biggest offices and clinics (multilocation with tons of owners).


A lot of people willing to manage a clinic full time are either 1) incompetent and not capable of producing more than their salary or 2) suspicious and scheme. It's possible to find a good manager and they're worth their weight on gold, but it's not easy at all. Most people who have good manager and people skills are building better careers than setting up a small doc office.

Medicine has far greater headaches than other industries. I have a small cosmetic business. It's simple - get service - pay money - done. No insurance, no waiting for months, no deducting or paying half what I bill, etc. Simple transaction. Medicine has become very burdensome.

 

[GlowInTheDark]

It is very difficult to compare- I agree! The PSLF forgiveness is if you are working at a non-profit 501(c)3, which many hospital employed positions are. There are no strings attached in that situation because the hospital itself is not actually giving you any of the money toward student loans.

It doesn’t seem like you’re fully grasping the amount of $ that would be forgiven if you achieved PSLF. It certainly won’t be the full $350k, maybe $100k if you’re lucky.

I’m a current fellow, interviewing with multiple practices/hospitals in multiple settings. Of the practices that have been more forthcoming with my anticipated earnings after…say 1-2 years and making partner…I would easily make more than an employed hospital position (as I should, frankly).

I wouldn’t trust a soul that was willing to sign me even before finishing residency.

 

[RoloTomassi]

It's hard to own and operate your own clinic in certain competitive markets int he country. In the Chicagoland area where I'm at, it's next to impossible. Some of the groups are so engrained and so old it's very hard for the new guy or gal to compete. Many are multi site places. There is an Ortho group here who has like 27 locations I think. How does one compete with that? And you are right owning a business is hard as heck, and there is so much overhead and so many headaches. It's hard to market yourself when there are 50 other doctors who do the same thing within a 10 block radius.

I find those who are successful in PP have an entrepreneurial spirit, and enjoy the challenge and competition. If you hate the business side of things and are only doing PP for the potential money, you'll probably be miserable. In the end, do what you enjoy in life, and if being a business owner is more a hassle than journey, don't force it.

 

[nvrsumr]

I would say that in some ways solo can be easier than group.

One boss- Only one way for staff to learn to do things and a lot of consistency for patients etc.

Partnership = marriage. People and priorities change or take problems to work.

Ultimate flexibility- revenue delta can be wide as covid taught. Add a PA or subtract an employee as needed.

Perks- maybe ur wife is the office manager or markets. Lots of other items where all the benefits flow to one person. These arrangements can get sticky with partners.

Vacation- no one is fighting over whatever holiday. Flip is always available by phone.

Reputation- yours alone.

 

[Ferrismonk]

I am curious to see what the financial effect is from all the Medicare changes this year and all the Blues going to Turning Point. Dropping the 3rd facet on most of our facet blocks has got to leave big dent...

 

[PainApp2021]

It doesn’t seem like you’re fully grasping the amount of $ that would be forgiven if you achieved PSLF. It certainly won’t be the full $350k, maybe $100k if you’re lucky.

Why do you say this? There is no cap on PSLF.

 

[GlowInTheDark]

Why do you say this? There is no cap on PSLF.

You have to make 120 qualifying payments based off your repayment plan. With an attending salary for 5 years your payment will likely be in the $2000-4000 range for nearly half of those payments. Fortunately, qualifying will be significantly easier than it has been due to reform that DoEd rolled out in the last 2 weeks.

I wouldn't make a career decision based off PSLF.

Public Service Loan Forgiveness (PSLF) for Doctors | White Coat Investor

If you're working for a(501(c3), PSLF is the federal debt forgiveness program most physicians should be looking at, offering tax-free forgiveness in under 10 years if you qualify.

www.whitecoatinvestor.com

 

[deleted875186]

You have to make 120 qualifying payments based off your repayment plan. With an attending salary for 5 years your payment will likely be in the $2000-4000 range for nearly half of those payments. Fortunately, qualifying will be significantly easier than it has been due to reform that DoEd rolled out in the last 2 weeks.

I wouldn't make a career decision based off PSLF.

Public Service Loan Forgiveness (PSLF) for Doctors | White Coat Investor

If you're working for a(501(c3), PSLF is the federal debt forgiveness program most physicians should be looking at, offering tax-free forgiveness in under 10 years if you qualify.

www.whitecoatinvestor.com

This. You’ll be on a standard 10 year repayment once you have a full attending salary. Look at a amortization schedule for a 350k loan, 6% interest, 10 years. By five years, which is when you’ll be eligible for PSLF, you will have paid about 200k, and you balance left will be just under 200k. Interest rate is a killer, I’m assuming yours is around 6%.

Alternatively you can refinance with a private bank for just under 3% and try and aggressively pay off the loan. Even if you take 10 full years to pay off at the lower 3% interest rate, Yoj will end up paying 405k.

Look at the difference in salary, probably you come out in top with the higher salary job and no PSLF.

 

[GlowInTheDark]

This. You’ll be on a standard 10 year repayment once you have a full attending salary. Look at a amortization schedule for a 350k loan, 6% interest, 10 years. By five years, which is when you’ll be eligible for PSLF, you will have paid about 200k, and you balance left will be just under 200k. Interest rate is a killer, I’m assuming yours is around 6%.

Alternatively you can refinance with a private bank for just under 3% and try and aggressively pay off the loan. Even if you take 10 full years to pay off at the lower 3% interest rate, Yoj will end up paying 405k.

Look at the difference in salary, probably you come out in top with the higher salary job and no PSLF.

Want to point out, if you’re under REPAYE and make proper pavements you get the interest benefit, which will halve your effective interest rate.

I’m at a 6.2% rate, effective rate is 3.1%. I was considering private refinance but decided against it as their rates were not better…or worse. And having federal loans…beyond the interest rate…is superior generally

ADDENDUM: remember too though, once you hit attending $$ you’ll likely lose the interest subsidy on REPAYE

 

[deleted875186]

Want to point out, if you’re under REPAYE and make proper pavements you get the interest benefit, which will halve your effective interest rate.

I’m at a 6.2% rate, effective rate is 3.1%. I was considering private refinance but decided against it as their rates were not better…or worse. And having federal loans…beyond the interest rate…is superior generally

I don’t understand this. REPAYE pays for all interest in subsidized loans and half of interest on unsubsidized when your calculated payment is not enough to even cover the interest accruing every month. When yojr income is high enough, the payment caps out at the 10 year standard repayment, and you end up paying interest and principle just like a 10 year repayment, no interest subsidy. Am I missing something?

 

[GlowInTheDark]

I don’t understand this. REPAYE pays for all interest in subsidized loans and half of interest on unsubsidized when your calculated payment is not enough to even cover the interest accruing every month. When yojr income is high enough, the payment caps out at the 10 year standard repayment, and you end up paying interest and principle just like a 10 year repayment, no interest subsidy. Am I missing something?

No, you’re not missing anything…I was commenting about my personal situation and was distracted while typing. I can completely see how what I said is confusing and I failed to point out what you’d did.

Once I lose interest subsidy I’m planning to look at refinance particularly if I’m not in a 501c employed position.

 

[drusso]

Realistically though, what is the average pain salary these days even for those who do make it to partners? At the fellowship I did, all the docs were Independent contractors I think or employed but paid per collections - except for a few I don't think most of them pulled more than 300-400k. How many pain docs are truly making 600$k plus these days? This is an honest question.

$600K is the new $300K

 

[PainApp2021]

You have to make 120 qualifying payments based off your repayment plan. With an attending salary for 5 years your payment will likely be in the $2000-4000 range for nearly half of those payments. Fortunately, qualifying will be significantly easier than it has been due to reform that DoEd rolled out in the last 2 weeks.

I wouldn't make a career decision based off PSLF.

Public Service Loan Forgiveness (PSLF) for Doctors | White Coat Investor

If you're working for a(501(c3), PSLF is the federal debt forgiveness program most physicians should be looking at, offering tax-free forgiveness in under 10 years if you qualify.

www.whitecoatinvestor.com

That is a fantastic point. I never thought about the realistic amount I would be paying monthly over the five years time at an attending salary. Thank you so much for this!

 

[RoloTomassi]

Best to just live like a resident and try to pay off your loans within 2-3 years. It's what's recommend on White Coat Investor and other FIRE type sites. Unless you have some high certainty investment, it's best to pay off ASAP.

 

[redchyvak]

I don’t understand this. REPAYE pays for all interest in subsidized loans and half of interest on unsubsidized when your calculated payment is not enough to even cover the interest accruing every month. When yojr income is high enough, the payment caps out at the 10 year standard repayment, and you end up paying interest and principle just like a 10 year repayment, no interest subsidy. Am I missing something?

Close - you're mixing up the difference between REPAYE and PAYE. While you get the interest subsidy if your calculated payment is less than the interest accruing, payments are NOT capped under REPAYE. As your income goes up, so too does the monthly payment. This is one huge, major reason why people with either high incomes or spouses with high incomes shouldn't choose REPAYE if they're trying to also go for PSLF.

PAYE, on the other hand, doesn't give you the interest subsidy during residency, but is DOES cap the payments at what the 10-year standard repayment plan would be.

 

[deleted875186]

Close - you're mixing up the difference between REPAYE and PAYE. While you get the interest subsidy if your calculated payment is less than the interest accruing, payments are NOT capped under REPAYE. As your income goes up, so too does the monthly payment. This is one huge, major reason why people with either high incomes or spouses with high incomes shouldn't choose REPAYE if they're trying to also go for PSLF.

PAYE, on the other hand, doesn't give you the interest subsidy during residency, but is DOES cap the payments at what the 10-year standard repayment plan would be.

So ideally the OP should be in REPAYE while in residency making payments that count towards PSLF, then switch to another payment Roman like PAYE to make the last payments to qualify for PSLF. Will end up paying a good portion of the loan over 5 years, but it sounds like PSLF would give the OP at least 100k forgiveness or so. Whether that’s worth the pay cut is likely a no.

Also tot he OP, would look into whether the PSLF is tax free, I think they just changed this. If it is not tax free then your getting hosed.

 

[redchyvak]

So ideally the OP should be in REPAYE while in residency making payments that count towards PSLF, then switch to another payment Roman like PAYE to make the last payments to qualify for PSLF. Will end up paying a good portion of the loan over 5 years, but it sounds like PSLF would give the OP at least 100k forgiveness or so. Whether that’s worth the pay cut is likely a no.

Also tot he OP, would look into whether the PSLF is tax free, I think they just changed this. If it is not tax free then your getting hosed.

In an ideal world, yes...but the problem is that when you switch from one program to another, it resets the 120 required payments. That was one of the reasons they structured it they way they did - no free lunch in this regard.

As for PSLF: it is tax free, and is currently listed it as such on studentloans.gov. If however you don't qualify for PSLF in that you aren't working for a non-profit organization, you can still qualify for forgiveness after 20 years - and that forgiveness is taxable.

If the previous 5 years count for PSLF, then going for PSLF probably would save some money. Standard repayment plan is about $3800, so doesn't really matter if you're choosing PAYE vs REPAYE if going for forgiveness. Guessing roughly $3k/mo in student loans, you'd be paying off $180k for the next 5 years and the balance would be forgiven.