W2 salary question

[The kitchen sink]

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currently in the job market negotiating a few contracts, I know there is MGMA data and medscape data

it ranges between 366k to 447k

What does this translate into hourly W2 rates?

I’m sure it depends on amount shifts worked per month

Thanks

 

[CCM-MD]

Medscape is a joke, no one uses those. MGMA numbers translate to total cash compensation: base plus any productivity/quality bonus/401k match. Excludes benefits like health insurance.

Rather than trying to translate the MGMA data into hourly rates, calculate your estimated annual cash compensation from the hourly rates being offered to you and compare it to the MGMA numbers.

 

[The kitchen sink]

Medscape is a joke, no one uses those. MGMA numbers translate to total cash compensation: base plus any productivity/quality bonus/401k match. Excludes benefits like health insurance.

Rather than trying to translate the MGMA data into hourly rates, calculate your estimated annual cash compensation from the hourly rates being offered to you and compare it to the MGMA numbers.

Ok help me understand how to properly calculate this please

If I do a mix of day and night shifts. Lets say about 14 shifts/month at an average rate of 190-200/hourly per shift on a W2 salary that equates to approx 33K per month which is about 396K per year. That excludes productivity, quality and 401K.

Is that an accurate way of calculating my ‘base pay’ ?

If I add in the rest, I believe it would be somewhere in the 430-440K range.

 

[CCM-MD]

If you’re doing week on/off it would be 182 shifts a year. Which comes out to $437k at $200/h, plus whatever quality, productivity, CME, 401k match you are getting. Add that up and the number you get would be more of an apples to apples comparison to the MGMA.

If you want to do it right you also want to get the region specific and practice type specific data from the MGMA and also ask your prospective employer what the avg annual wRVUs are to get a better idea of how hard you are going to be working. You don’t want to work at the 90th percentile and get paid at the 50th percentile.

 

[The kitchen sink]

If you’re doing week on/off it would be 182 shifts a year. Which comes out to $437k at $200/h, plus whatever quality, productivity, CME, 401k match you are getting. Add that up and the number you get would be more of an apples to apples comparison to the MGMA.

If you want to do it right you also want to get the region specific and practice type specific data from the MGMA and also ask your prospective employer what the avg annual wRVUs are to get a better idea of how hard you are going to be working. You don’t want to work at the 90th percentile and get paid at the 50th percentile.

I’m doing a bit less so it essentially comes out to 168 shifts at an avg rate of 195/hr which comes out to 390ish before benefits.

I’m also talking to another place trying to work out a per diem rate. Negotiations are stalling out at around the same rate, supposedly a really light volume shop

If you’re doing week on/off it would be 182 shifts a year. Which comes out to $437k at $200/h, plus whatever quality, productivity, CME, 401k match you are getting. Add that up and the number you get would be more of an apples to apples comparison to the MGMA.

If you want to do it right you also want to get the region specific and practice type specific data from the MGMA and also ask your prospective employer what the avg annual wRVUs are to get a better idea of how hard you are going to be working. You don’t want to work at the 90th percentile and get paid at the 50th percentile.

I think my total comes out something like 168 shifts/year.

Aside from doing what you suggested, if all else seems fair, do you think i’m getting a fair contract?

 

[CCM-MD]

This is probably below the national median. But it depends on the location (could be a great deal for NYC for example), how hard you are going to be working, what the total comes out to after bonus.

 

[chocomorsel]

Yup. That is low. Agreed.

 

[The kitchen sink]

This is probably below the national median. But it depends on the location (could be a great deal for NYC for example), how hard you are going to be working, what the total comes out to after bonus.

Well for the per diem gig:

It is essentially an area near right outside the NYC metropolitan area

Supposedly light work for day shifts on the weekends (as I’ve heard from colleagues)

Per diem (my choice as to number of shifts), no benefits, malpractice with tail covered by hospital

Critical care PA coverage who do perform basic CC procedures (lines etc)

They started the offer at 175/hr, now settled around 195/hr

I’m just wondering if that is a good deal for the region or not, and if not how do i counter? With survey data? Etc
There is no source for per diem data, is there?

 

[The kitchen sink]

Yup. That is low. Agreed.

See above response. Any advice?

 

[CCM-MD]

If that’s 200/h for a locum position or even 1099 that is terrible. Locum rates are $350-400+/h right now. For permanent/W2 $200/h is probably around the median.

 

[grt398]

It's probably really hard, but it'd be worth asking other docs in the area (maybe faculty know former fellows in PP in the area?) to see if you can get some data. I agree with CCM-MD above that the rate they're offering for 1099 right now is quite low but there's always the geography issue (i.e. NYC/SF/LA/Seattle etc) so if it's some hospital Scarsdale/Yonkers/whatever that's a very short train ride from NYC, you might be kinda stuck.

 

[The kitchen sink]

If that’s 200/h for a locum position or even 1099 that is terrible. Locum rates are $350-400+/h right now. For permanent/W2 $200/h is probably around the median.

It’s per diem W2 (no benefits) directly contracted with the hospital. I choose when and how much I work.

So that’s essentially what i’m trying to understand is, are locums rates (1099) through a locums company supposed to be similar to the per diem W2 rates?

 

[The kitchen sink]

It's probably really hard, but it'd be worth asking other docs in the area (maybe faculty know former fellows in PP in the area?) to see if you can get some data. I agree with CCM-MD above that the rate they're offering for 1099 right now is quite low but there's always the geography issue (i.e. NYC/SF/LA/Seattle etc) so if it's some hospital Scarsdale/Yonkers/whatever that's a very short train ride from NYC, you might be kinda stuck.

It’s about 1.5 hour drive outside of NYC.

It’s a W2 per diem, however no benefits. Not 1099.

I am trying to understand what the difference should be in W2 vs 1099 pay, should it be similar, or different, and if so, how different?

The competiting 1099 locums offers in the same area are in the $350-400 range. I am already involved in this. I just wanted to line up a good gig for once the CC covid surge rates died down.


Thank you for the responses and advice.

 

[CCM-MD]

If they are not giving you any benefits, that’s essentially a 1099 position in my mind and the rate should be higher than what they are giving an employee who gets full benefits.

 

[lunaire]

It’s about 1.5 hour drive outside of NYC.

It’s a W2 per diem, however no benefits. Not 1099.

I am trying to understand what the difference should be in W2 vs 1099 pay, should it be similar, or different, and if so, how different?

The competiting 1099 locums offers in the same area are in the $350-400 range. I am already involved in this. I just wanted to line up a good gig for once the CC covid surge rates died down.


Thank you for the responses and advice.

Kinda strange to offer a W2 with no benefit vs plain 1099 for per diem. If you do accept this contract, you should read the fine lines very carefully. You may have to go through payroll to get reimbursement for travel, lodging etc; if they are covered.

ALso, agree with the others, hourly rate is low. That seems more like a NYC kinda rate. The suburb should be paying more... I've been out of that area/market for a while, but $250 would be what I'd negotiate for; much more if lodging/transport is not provided. With that said, low volume with help may make it worth it, if that's what you're looking for.

 

[The kitchen sink]

If they are not giving you any benefits, that’s essentially a 1099 position in my mind and the rate should be higher than what they are giving an employee who gets full benefits.

Kinda strange to offer a W2 with no benefit vs plain 1099 for per diem. If you do accept this contract, you should read the fine lines very carefully. You may have to go through payroll to get reimbursement for travel, lodging etc; if they are covered.

ALso, agree with the others, hourly rate is low. That seems more like a NYC kinda rate. The suburb should be paying more... I've been out of that area/market for a while, but $250 would be what I'd negotiate for; much more if lodging/transport is not provided. With that said, low volume with help may make it worth it, if that's what you're looking for.

That’s all fine and dandy, i’ll prob just stick to my locums gigs that are paying much more

Curious, have y’all heard this term called ‘fair market value’? This is the term the contract guy kept throwing out there while lowballing me.

Any idea what this is? Sounded like some bs but apparently its ascertained from surveys such as the MGMA etc

 

[dieABRdie]

Curious, have y’all heard this term called ‘fair market value’? This is the term the contract guy kept throwing out there while lowballing me.

Its a phrase that administrators use to trick naïve, spineless doctors into accepting a crap offer. I've heard it before. They make the claim that they aren't allowed to pay you more than the median MGMA because its not "fair market value."

Fair market value is anything within the range of MGMA. There's no law that says they can't pay you whatever they want, assuming you have no financial stake in the facility. I went back and forth with an admin once for an incredibly rural job. I refused to take less than 75% MGMA. He refused to go above median MGMA because.... "fair market value." I walked and am glad I did.

Don't fall for it.

 

[The kitchen sink]

Its a phrase that administrators use to trick naïve, spineless doctors into accepting a crap offer. I've heard it before. They make the claim that they aren't allowed to pay you more than the median MGMA because its not "fair market value."

Fair market value is anything within the range of MGMA. There's no law that says they can't pay you whatever they want, assuming you have no financial stake in the facility. I went back and forth with an admin once for an incredibly rural job. I refused to take less than 75% MGMA. He refused to go above median MGMA because.... "fair market value." I walked and am glad I did.

Don't fall for it.

Thanks, that’s exactly what I thought.

 

[The kitchen sink]

Its a phrase that administrators use to trick naïve, spineless doctors into accepting a crap offer. I've heard it before. They make the claim that they aren't allowed to pay you more than the median MGMA because its not "fair market value."

Fair market value is anything within the range of MGMA. There's no law that says they can't pay you whatever they want, assuming you have no financial stake in the facility. I went back and forth with an admin once for an incredibly rural job. I refused to take less than 75% MGMA. He refused to go above median MGMA because.... "fair market value." I walked and am glad I did.

Don't fall for it.

So you’re basically saying the offer i’m getting is crap?

 

[anonperson]

That’s all fine and dandy, i’ll prob just stick to my locums gigs that are paying much more

Curious, have y’all heard this term called ‘fair market value’? This is the term the contract guy kept throwing out there while lowballing me.

Any idea what this is? Sounded like some bs but apparently its ascertained from surveys such as the MGMA etc

Fair market value is this phrase hospital admin throws around to low ball physician pay.

They will also incorrectly throw out Stark Law without really explaining it in hopes of getting physicians to shut up and accept a low offer.

From my last contract negotiations (different specialty) the administrator I dealt with would throw those phrases around without understanding the meaning.

They wanted to cut our pay by around $20,000 claiming we were overpaid/FMV/Stark Lawetc. 4 of us resigned and found jobs that paid more with less work in the community.

Not surprisingly, when they realized that people actually quit, they redid contracts and came up on compensation on the people who did stay.

Moral of the story: Administration is greedy and stupid.

A hospital can pay whatever they want for a physician. They can play around with compensation using bonuses, medical director stipends etc.

Admins goal is to pay 25th% to 50th% pay for 75th% to 90% work. That is their playbook. Nothing more complicated than that.

 

[CCM-MD]

What is included in MGMA "total comp" is below. I incorrectly stated earlier in this thread that 401k employer contributions are included - this is not the case.

 

[chocomorsel]

So you’re basically saying the offer i’m getting is crap?

Yes!!!

 

[aafisahar]

So you’re basically saying the offer i’m getting is crap?

It's crap for a hospitalist gig, nevermind cc.

 

[The kitchen sink]

Yep, that offer has been declined. Sticking with locums who are paying up

 

[lunaire]

Kinda crazy how paying a higher salary is so much less desirable than paying the same amount or higher for a locums. I know this for a fact that in my medical system - a top 10 largest healthcare system in the US - they would rather let an uncovered shift go to a locums than pay me the same amount. I got the admin and a locum recruiter offering me the same shift, but locums is paying a significant amount more, even with the recruiter's cut.

 

[The kitchen sink]

Kinda crazy how paying a higher salary is so much less desirable than paying the same amount or higher for a locums. I know this for a fact that in my medical system - a top 10 largest healthcare system in the US - they would rather let an uncovered shift go to a locums than pay me the same amount. I got the admin and a locum recruiter offering me the same shift, but locums is paying a significant amount more, even with the recruiter's cut.

EXACTLY this.

Must have something to do with tax write offs, right?

Or stupidity/ psychological effects? I.e. if we pay them this much then everyones going to want a raise and we can’t have the plebs revolting etc

I don’t really know the reasons why but it’s definitely like this in most places

 

[anonperson]

Or stupidity/ psychological effects? I.e. if we pay them this much then everyones going to want a raise and we can’t have the plebs revolting etc

Mainly this.

CEO/CFO see salaries for doctors/nurses/techs as a giant black hole.

If they start to pay one of their own employed physicians a higher rate for an uncovered shift, it sets a precedent in their eyes that can get out of control.

It's a mix of greed and stupidity from administration.

 

[lunaire]

EXACTLY this.

Must have something to do with tax write offs, right?

Or stupidity/ psychological effects? I.e. if we pay them this much then everyones going to want a raise and we can’t have the plebs revolting etc

I don’t really know the reasons why but it’s definitely like this in most places

It's also a corporate finance thing. Locums can be categorized as a temporary/variable cost. This looks better when corporate profit is down. One of the C-suite's main objective is to make sure the company at least appears profitable. There are some pros to not having your company seem like it's heading for bankruptcy.