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Salary: Academic vs. Private Practice
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i know of two places that published salaries for academics
univ of michigan had salaries posted several years ago for all employees
http://www.d-struct.org/projects/salary/
there was a similar list for UCs
http://www.sfgate.com/news/special/pages/2005/ucsalary/
salaries range usually from 150 to 200. notice that salary and total income aren't necessarily the same
univ of michigan had salaries posted several years ago for all employees
http://www.d-struct.org/projects/salary/
there was a similar list for UCs
http://www.sfgate.com/news/special/pages/2005/ucsalary/
salaries range usually from 150 to 200. notice that salary and total income aren't necessarily the same
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Thank you for the information. I have another question. When salary and total income are not the same, where does the difference come from? These questions arose when I was discussing post-fellowship options with someone (academic v. private practice v. VA or military), and I realized how little I know about the finances of my options. 😱
I have a large student loan debt, and while I don't require a rock star lifestyle, I want to eat more than ramen noodles and pinto beans. 😀
I have a large student loan debt, and while I don't require a rock star lifestyle, I want to eat more than ramen noodles and pinto beans. 😀
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A variety of places
1) Bonuses - the size of and reasons for getting a bonus vary by institution
2) Benefit packages - are frequently sizeable at university programs - healthcare, retirement, disability insurance, malpractice*, and sometimes other items (e.g. free or subsidized college tuition for your kids)
3) "Other" - departments find creative ways to compensate people. This is generally done for very high earners (i.e. not junior faculty) at public institutions that have to open their records.
* before someone says that malpractice is included in everyone's salary - which it is 99% of the time - working for an institution insulates you the varying cost and availability of malpractice. If a 4 man private practice group pays an extra $100K for malpractice, then each partner's salary drops $25K. That's not necessarily true at a university.
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The AAMC publishes a book which lists average academic salaries by region and specialty. I think this is it: https://services.aamc.org/Publicati...1&cftoken=57DCD7B6-0457-43E9-A965187FA37F0EBC
My PD had it and we looked up various areas around the US I was interested in, so I would know what the average was. You might check and see if some of your faculty or your library has it before purchasing.
Contract negotations and salary considerations have a lot more involved that just "show me the money". Private practice may entail a salary guarantee for the first year or so, to help you get on your feet, but after that you would be on your own, and generally responsible for your share of the practice expenses, even if you aren't a partner. Since practice expenses will go up when you join (as they have more billing time, paperwork, etc.), you need not only to consider whether malpractice is included, but also health insurance, practice expenses, licensing, etc. A lot more than they ever told us, especially in academic residencies, about.
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Kimberly makes good points - the overall guiding priniciple for private practice is that you are a small business owner.
You provide a service to a patient and they pay you.
You pay your business expenses
You take home the rest
Ultimately, you start each year $100,000 or more in the red and work your way out with every procedure you bill. Every single penny you spend on malpractice, licensing, nurses, etc is ultimately coming straight out of your pocket. It's not at all like having a job that pays $X/year ... which lots of people like!
You provide a service to a patient and they pay you.
You pay your business expenses
You take home the rest
Ultimately, you start each year $100,000 or more in the red and work your way out with every procedure you bill. Every single penny you spend on malpractice, licensing, nurses, etc is ultimately coming straight out of your pocket. It's not at all like having a job that pays $X/year ... which lots of people like!
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I realize that salary is not the sole determinant of a financial offer. That was how our discussion started... is it better to go somewhere with loan payoff and take a smaller salary/bonuses? Is an academic career a reasonable option if I choose that? One person pointed out that there are certain benefits of working in the VA system that are not available in any part of the private sector.
We actually have had some talks about contract negotiations in my residency, in general terms. I guess what I am looking for is information on how that balance of salary/bonuses/benefits/malpractice/licensing and fees/etc varies in different settings.
I appreciate all of the previous comments too.
We actually have had some talks about contract negotiations in my residency, in general terms. I guess what I am looking for is information on how that balance of salary/bonuses/benefits/malpractice/licensing and fees/etc varies in different settings.
I appreciate all of the previous comments too.
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All good questions and the answer to all of them is it depends. There are consultants who do nothing but analyze compensation packages - the details are too numerous to generalize, especially when you throw in
varying costs of living, potential spouse job opportunities, etc.
I will say that I've never heard of anyone working for the VA without substantial extenuating circumstances. From what I hear, they pay very poorly, benefits or no.
Regarding academics vs. private practice, you will almost always make less money as an acadmic - just have to decide what you want out of your career. And you have to decide what you want out of your financial life. You can pay off your loans and eat well as an academic - no problem. The question is how nice will your house(s) be, where you vacation, etc.
varying costs of living, potential spouse job opportunities, etc.
I will say that I've never heard of anyone working for the VA without substantial extenuating circumstances. From what I hear, they pay very poorly, benefits or no.
Regarding academics vs. private practice, you will almost always make less money as an acadmic - just have to decide what you want out of your career. And you have to decide what you want out of your financial life. You can pay off your loans and eat well as an academic - no problem. The question is how nice will your house(s) be, where you vacation, etc.
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The answer to your question is as ephemeral as the old saw, "I have a 3.35 gpa and a 32 MCAT, will I get into medical school?" It depends and only you can decide what is worth giving up and what isn't. Since I am currently in the abyss, I shall share some of my experiences...
PRIVATE PRACTICE:
Pros
- Essentially no limit on what you can make; you work, you can bill, and you can decide how much you want to work
- Room to grow - ie, become a partner, add other services, buy into ancillary services (ie, like an ASC - but be careful of Stark Law violations)
- Often more technologically advanced than academics - ie, EMRs, "paperless" practices, in-office equipment
- Someone else to do your billing, paperwork (albeit not all of it, and you still have to keep an eye out for mistakes)
- Senior partner(s) to train you, mentor you
Cons
-You may have to work a lot to make a decent salary, especially when starting out and if you don't have a salary guarantee
- its like a marriage; you must get along with your partners, otherwise it can be very uncomfortable. Like a marriage, it can be easier to get into, and more painful to get out of.
- Someone else is doing your billing, paperwork (that means you can be exposed to embezzlement, improper billing and lack of follow-up which reduces your income)
- Lack of multidisciplinary environment; other specialists are generally not in the office with you, and you have to market yourself to them if you want referrals.
ACADEMIC/HOSPITAL-BASED PRACTICE:
Pros
- Set salary and income; you know what you are getting and unless you are a real slacker, you will get it without fail
- Opportunity to teach (although this can occur in private practice as well)
- Often residents to do some clinically useful training for you
- Can have time to do research, own lab (hard to do in private practice; funding from companies, especially for cooperative trials is pretty low and not worth the paperwork and necessary administrative people it takes for smaller practices)
-Ancillary services and other specialties close-by, in house.
- malpractice, health insurance, etc. are provided and your contribution is generally low
Cons
- Academic advancement is often very regimented and can be political; can toil in the trenches for years and find that advancement to professor is fraught with high school like popularity contents
- Salary has tendency to be lower than in private, not as much room for increase (ie, you can't work more and get a higher salary)
- may require research, or lab time
- may require teaching, which some don't like
- interdepartmental politics
Anyway, these are just off the top of my head. I'm sure there are many more. Working at the VA, as Pilot notes, is generally not seen as a good deal for most. The salary is often MUCH lower than what you would earn elsewhere, even a local academic or community hospital, the regulations far greater, the resources can be far less (ie, not all hospitals provide even the most basic specialists...especially after hours) and patients must be transferred, the nursing staff has a reputation for not being the most skilled, etc. But the hours can be good.
While a loan payoff can be tempting, if in return you take a lower salary - consider that if you took the lower salary for a few years, and they paid off your loans, you would still be earning the lower salary after that period. But if you took a higher salary, but lived at the lower salary and paid off your loans yourself, when they were paid off, you would have the higher salary .
Only you can decide whether the lower salary is worth other incentives - loan payoff, extra vacation, signing bonus, more CME $; in general though, the loan interest rate is so low that a loan payoff is not necessarily worth the lower salary offers you get.
PRIVATE PRACTICE:
Pros
- Essentially no limit on what you can make; you work, you can bill, and you can decide how much you want to work
- Room to grow - ie, become a partner, add other services, buy into ancillary services (ie, like an ASC - but be careful of Stark Law violations)
- Often more technologically advanced than academics - ie, EMRs, "paperless" practices, in-office equipment
- Someone else to do your billing, paperwork (albeit not all of it, and you still have to keep an eye out for mistakes)
- Senior partner(s) to train you, mentor you
Cons
-You may have to work a lot to make a decent salary, especially when starting out and if you don't have a salary guarantee
- its like a marriage; you must get along with your partners, otherwise it can be very uncomfortable. Like a marriage, it can be easier to get into, and more painful to get out of.
- Someone else is doing your billing, paperwork (that means you can be exposed to embezzlement, improper billing and lack of follow-up which reduces your income)
- Lack of multidisciplinary environment; other specialists are generally not in the office with you, and you have to market yourself to them if you want referrals.
ACADEMIC/HOSPITAL-BASED PRACTICE:
Pros
- Set salary and income; you know what you are getting and unless you are a real slacker, you will get it without fail
- Opportunity to teach (although this can occur in private practice as well)
- Often residents to do some clinically useful training for you
- Can have time to do research, own lab (hard to do in private practice; funding from companies, especially for cooperative trials is pretty low and not worth the paperwork and necessary administrative people it takes for smaller practices)
-Ancillary services and other specialties close-by, in house.
- malpractice, health insurance, etc. are provided and your contribution is generally low
Cons
- Academic advancement is often very regimented and can be political; can toil in the trenches for years and find that advancement to professor is fraught with high school like popularity contents
- Salary has tendency to be lower than in private, not as much room for increase (ie, you can't work more and get a higher salary)
- may require research, or lab time
- may require teaching, which some don't like
- interdepartmental politics
Anyway, these are just off the top of my head. I'm sure there are many more. Working at the VA, as Pilot notes, is generally not seen as a good deal for most. The salary is often MUCH lower than what you would earn elsewhere, even a local academic or community hospital, the regulations far greater, the resources can be far less (ie, not all hospitals provide even the most basic specialists...especially after hours) and patients must be transferred, the nursing staff has a reputation for not being the most skilled, etc. But the hours can be good.
While a loan payoff can be tempting, if in return you take a lower salary - consider that if you took the lower salary for a few years, and they paid off your loans, you would still be earning the lower salary after that period. But if you took a higher salary, but lived at the lower salary and paid off your loans yourself, when they were paid off, you would have the higher salary .
Only you can decide whether the lower salary is worth other incentives - loan payoff, extra vacation, signing bonus, more CME $; in general though, the loan interest rate is so low that a loan payoff is not necessarily worth the lower salary offers you get.
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as usual many good comments made. dr. cox really spelled a lot of things out for people so that they can better understand the differences.
having worked in both practice setups, i can say that the difference between the university physician and the private practitioner as far as salary is closing. the term "salary" really should be used loosely. even many university systems have gone to a productivity based pay scale.
i think when you look as how much will you make you have to think like a business person. you need to think about location, insurance payor mix of the practice, likelihood of investing in other things such as PT, MRI, Pharmacy. these are things that will increase your revenue.
there are some university/private practices (RUSH comes to mind) and then there are true university practices (University of Michigan).
something also to consider, you can also work for a hospital or hospital system (be a hospital employee)where you may get a salary. the hospital covers overhead. less pay and headache.
let me tell you when searching for a job/practice, no one prepares you for all the business mumbojumbo and legal crap you have to understand.
having worked in both practice setups, i can say that the difference between the university physician and the private practitioner as far as salary is closing. the term "salary" really should be used loosely. even many university systems have gone to a productivity based pay scale.
i think when you look as how much will you make you have to think like a business person. you need to think about location, insurance payor mix of the practice, likelihood of investing in other things such as PT, MRI, Pharmacy. these are things that will increase your revenue.
there are some university/private practices (RUSH comes to mind) and then there are true university practices (University of Michigan).
something also to consider, you can also work for a hospital or hospital system (be a hospital employee)where you may get a salary. the hospital covers overhead. less pay and headache.
let me tell you when searching for a job/practice, no one prepares you for all the business mumbojumbo and legal crap you have to understand.
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Reminds me of my favorite story about a small VA hospital that refers to our larger "academic" VA. They don't have radiography at night. No, no radioLOGY. They don't have radioGRAPHY after hours. When somebody crumps (or even wheezed) after hours, it's just you, your stethoscope and Osler's ghost sitting on your shoulder.
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Yep...mine was the same. No radiology after hours or on weekends. The patients had to be shipped, at the government's cost, to Hershey Med (30 minutes away). And of course, they would be shipped back...even with some frightening findings on the CT scans, Xrays,etc.
Nothing too good for our vets!
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That doesn't even make sense to me from a cost perspective. Without even considering delays causing complications and resulting increased length of stay, it just doesn't make sense to me why transporting a patient to another hospital and back would be better than just paying radiology techs be available after hours. It just boggles the mind. Good to know our tax dollars are well-spent. Guess I shouldn't be too surprised.
