Career Planning
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Reviewing Your Job Offer
Consider the Non-Salary Benefits
Your compensation package is more than just salary. Be sure to consider the incentives and benefits offered to you as well.
There are several common benefits outlined below. In many cases, benefits can account for 25-30% of the value of your total compensation package, so be sure to take advantage of these perks when they are offered.
Your compensation package is more than just salary. Be sure to consider the incentives and benefits offered to you as well.
There are several common benefits outlined below. In many cases, benefits can account for 25-30% of the value of your total compensation package, so be sure to take advantage of these perks when they are offered.
Recruiting Incentives
Many of these benefits are offered in exchange for your commitment to practice for a specific period of time.
If you terminate your contract before this period of time you will likely be subject to repayment of any monies received. In some cases, there may be eligibility requirements or specific milestones associated with these benefits.
Read the fine print and ask for all the details. There is no such thing as free money, so be sure you fully understand all the requirements and stipulations with these kinds of benefits. Additionally, be aware that recent tax law changes have implications on how various incentives are viewed by the IRS. In most cases, they are now all viewed as income, and will likely be taxed as such. For information on tax implications, but sure to consult your authorized tax advisor or accountant.
A payment offered to you as a condition of employment or agreement to work. The bonus may be paid in one lump sum or installments.
Employers or practices use sign-on bonuses as an incentive to:
- entice you to work with them
- secure your commitment to work with them
Financial assistance or services offered to you as a new physician moving to a new city or state to practice.
A lump-sum payment or reimbursement for expenses may be offered.
A certain amount of medical school loan repayment may be offered in return for a practice commitment.
It is likely there will be an annual amount offered for a specific number of years, but there may also be a lump sum paid to you at the end of a certain time period.
Typically, each year of loan repayment accepted will stipulate a specific number of years of service in return.
Retention bonuses are a financial incentive offered as a reward for your longevity in the position. Employers use these to reduce attrition and avoid high costs associated with hiring, training, and onboarding new physicians.
Bonus payments are usually paid incrementally over the period of desired retention or upon completion of the contract term.
Insurance Coverage
If offered, your practice or employer may pay all or a portion of insurance premiums to provide you with various forms of insurance coverage.
Professional liability insurance to provide you with coverage and protection from liability arising from wrongful practices and costs associated with defending medical malpractice cases.
When patients or families sue physicians for medical malpractice, this is the insurance that protects your assets if you are found liable. It may also cover costs for defending your case.
There are individual or group malpractice coverage plans and most states require it to practice.
Short-term or long-term disability plans will pay a portion of your income if you cannot work for a specific period of time.
Short-term policies typically pay a higher percent of your income for a shorter period of time while long-term policies pay a lower percent of your income for the entire duration of the disability. There are many nuances to disability insurance so be sure to seek advice from a trusted financial expert and remember that those who sell insurance may not place your best interests before those of the insurer.
A certain percentage of premiums towards a life insurance policy are paid by the employer or practice. Upon death of the insured, a lump sum of money is paid to designated beneficiaries listed on the policy. Like disability insurance, there are many different products and nuances to consider. Consider consulting a trusted financial expert and remember that those who sell insurance may not put your best interests ahead of the insurer.
Employers pay all or a portion of the insurance premiums depending on the plan you select. It is very common for health insurance to be offered for you, your spouse, and any children or dependents.
- Medical – employer-funded, medical insurance plans with a variety of plan types of coverage options
- Dental – preventive, basic, and major service plans pay for a portion of dental treatment and services
- Vision – coverage for vision care expenses such as eye exams, prescription glasses, or contact lenses
Employer-Sponsored Savings Plans
When offered, this allows you to contribute pre-tax dollars to a healthcare account. You can then use this money to pay for out-of-pocket health care expenses, such as deductible, copays, or coinsurance for medical services and prescription drugs. Many employers offer matching contributions as well.
This plan essentially allows you to you or your employer to contribute funds, up to Federally defined limits, into an account each year. It allows you to reduce your taxable income, and the funds may be invested. Any interest growth remains tax-free, and the funds may be withdrawn tax-free if used to pay approved medical expenses. This can be a powerful savings tool and also helps lower medical costs, particularly if you are in a high-deductible health insurance plan, which commonly accompanies these accounts.
This is one of very few “triple-tax-advantaged” investment vehicles in existence, so strongly consider taking advantage of it if offered.
When offered, a Flex account allows you to contribute pre-tax dollars to an annually renewing account. You can then use this money to pay for certain out-of-pocket medical expenses. Flex accounts differ from Healthcare Savings Accounts in several ways, so be sure to clarify with the Benefits office of your new employer.
Of note, Flex accounts are “use-it-or-lose-it” accounts, meaning that any funds remaining at the end of the benefits year will be forfeited.
Employer-sponsored Retirement Savings Plans, also known as a 401k (for-profit companies) or a 403b (non-profit organizations), allow you to set aside pre-tax income and place it into an investment account. You will decide how much to contribute from each pay check up to a designated amount annually, which is mandated by the IRS.
In some cases, employers will match your deferred amount, which means they put their own money in your 401k or 403b account in a sum matching yours. This is essentially free money, if you elect to participate in the Retirement Savings Plan.
Additionally, a non-qualified deferred compensation plan (457b) may be offered with you retirement savings plan as well. This allows you to save an additional money each year up to a certain annual amount designated by the IRS.
Neonatologists who are independent practitioners or locum tenens don’t have access to these types of employer-sponsored plans, but similar Individual Retirement Account options do exist. Consult a trusted financial advisor for additional information.
Time-Off Benefits
A certain number of vacation days or weeks may be offered or accrued per year to be used for vacation time while still being paid.
Sometimes paid vacation is included in a paid time off (PTO) bank of hours. Other programs may elect not to accrue PTO, and to rather be paid for all hours worked, with some time-off accommodation built into the scheduling process or point system.
Remember that most employed physician positions are referred to as “exempt.” Exempt positions are excluded from minimum wage, overtime regulations, and other rights and protections afforded nonexempt workers. Most contracts contain a provision stating that physician coverage will be sufficient to adequately provide necessary care for patients. What this translates to for many practices is that you work until the work is done. There are no maximum hour restrictions once you leave fellowship, so be sure the practice you wish to join has the ability to safely and sanely provide patient care.
While not common in neonatology, you might come across a practice or health system that has designated paid holidays for which there may be a additional payment, or differential, for working that day. More commonly, practices develop a coverage model that allows some type of predictable balance to the holidays worked vs holidays off each year.
Be sure to ask to ensure the “newbie” isn’t stuck with an unreasonable share of the burden.
Other Benefits
Fees associated with professional licenses, journals, education, or professional development may be covered by the practice.
- Continuing Medical Education (CME)
- Registration or Travel Expenses for conferences
- Professional Dues
- Journal Subscriptions
- License Fees (DEA, State Board of Pharmacy, State licensure)
- Board certification fees and expenses
You may be offered coverage for expenses such as housing, vehicles, mileage, or parking. Some programs may offer technology allowances for cell phones, cell phone service plans, tablets, computers, or other electronic equipment when its primary purpose is to support practice business.
Some programs may offer paid or non-paid support for the following leaves of absence. When taking advantage of these, be sure to research how they may impact hospital privileging, as some Medical Staff Offices require notice of such leaves.
- Outreach or Teaching
- Maternity or Family Leave
- Sabbatical
- Medical missions
