Compensation is not a physician's only consideration when contemplating a new job, and it shouldn't be a hospital's only draw. Physician retention starts with healthcare executives making strong hiring decisions.
The physician shortage is driving up the value compensation packages and simultaneously making physician retention more challenging.
According to the Medical Group Management Association's Physician Placement Starting Salary Survey, released last month, first-year physicians are enjoying, signing bonuses, paid relocation fees and other perks such as student loan forgiveness as part of their compensation.
"It clearly is getting more and more competitive due to the shortage of physicians", says Kenneth Hertz, healthcare consultant with the MGMA. "The median [first year guaranteed starting salary] is $260,000, but there are salaries that we've seen that are considerably higher. I've personally seen them at $450,000 or $500,000."
Hertz also says he's seen starting bonuses in the $50,000 to $75,000 range, but that it wouldn't surprise him a bit to see a bonus topping $100,000. "Everybody is looking for a signing bonus when they come on," agrees Craig Talega, vice president of physicians' services at Divine Savior Hospital in Portage, WI.
Job hopping is hitting healthcare hard. "The average tenure for a new physician, just out of residency, is one and a half to two years," laments Talega, who has been with Divine Savior Hospital for 21 years. Experienced physician who want to find a new job, likely won't have to look far.
So, how do should HR execs select candidates who are going to stick around through this high compensation frenzy—and hold on to physicians already hired?
While it may feel like retaining physicians is a losing battle, that's not the case, maintain both Hertz and Talega. While money may sweeten any pot, cash incentives alone will backfire.
"I've done a lot of work with fellows coming out of medical school who say they see… an opportunity to make a lot of money. I try to have a conversation with these folks… and talk [them] out of that because I think that, in this chosen profession, [other] things matter," said Hertz.
"I think there are some people who chase the money, but… as time has gone on, the competition we have for physicians usually does not come down to money. The finances are important, but it's about location, what they like to do in their free time and families," says Talega.
Ultimately, while it might sound like a good idea to a young physician right out of residency to practice in a very remote area and get paid a hefty salary to do it, if he hates the climate, is far away from friends and extended family and his spouse and kids feel like they don't fit in, that placement won't last—which won't be good for the organization, the patients, or the physician and his family.
"The worst thing for a patient is to have to change doctors," Talega said. To avoid presenting patients with that situation, Divine Savior's HR department focuses on hiring medical professionals who have reasons to stay put.
Talega tries to focus on candidates who have a strong connection to the area—who are accustomed to harsh Wisconsin winters, have family and friends locally or perhaps went to school in the area. What he's looking for is an indication that they won't be pining for a warmer climate or bigger city.
Additionally, Talega looks for candidates who are likely to get involved in the close-knit local community in Portage, and who embrace the hospital's patient-centric and service-oriented goals.
"We're looking for people that embrace our mission, vision and values," he said. Given the social nature of Divine Savior's workplace, he looks for candidates who share common interests, both professionally and personally, with established physicians. He's also careful to screen out job hoppers—people who change jobs every two or three years.
Hertz and Talega both agree that, to be happy, candidates must find a practice that has similar values to their own, whether that is patient-centered care, teamwork or a shared faith. And if the candidate's primary value is making money?
"You may find a practice where everyone wants to make as much money as possible. Then, I guess you've found a practice that shares your vision." But, in Hertz's experience, a practice more concerned with making money than caring for patients is bad news.
"And if your family is unhappy, or you are unhappy in that care setting, well… I just don't think it's sustainable."
Bottom line: It makes sense to worry about physicians leaving for better compensation, but a hospital's best weapon for retention of its physicians is to continue to offer competitive benefits and compensation—and to hire purposefully. It may be a seller's market, but ultimately, making good hires is the best first step toward retaining physicians.
Lena J. Weiner is an associate editor at HealthLeaders Media.