Physician Seeking Hospital Employment?  Red Flags to Consider
Written by James Hamilton, CMPE, FACMPE

Physician employment by hospitals is ever present in the market. The strategic reasons for physician employment have shifted. In the mid-1990s, employment strategies were focused on primary care. Hospital employment of primary care is still prevalent; however, the focus has shifted to specialist employment. Specialty employment is rooted in the need to protect hospital service lines (i.e., orthopedics, obstetrics/gynecology, etc.). This is particularly prevalent with small- to medium-size hospitals. However, in markets where malpractice is high, large hospitals and multi-hospital systems are employing specialists that have burdensome malpractice premiums. Again, physician employment is being pursued to protect important acute care service lines.

If you are a physician looking for hospital employment, there are some very important things to consider when looking at a potential employer. These considerations go beyond geographic location and selection of a recruiter but more so to the interview process and employment offer. The following list of questions should be part of your agenda while on the interview.

• Can you demonstrate to me that there is a market need for my services?
  
  Another way to put this is, will I be busy? To meet appropriate compliance requirements as well as being a good business principle, the process of recruiting a physician should be supported by demonstrating that there is a community need. It has been observed, however, that hospitals will engage in physician recruitment strategies as a result of competitive forces. For instance, a local specialty group might have decided to pull all services from the hospital. The hospital will take a defensive strategy of starting a competing service. You could be coming into a saturated provider market. Likewise, if you are being asked to start a “new” service in a competitive market, you need to be strong and confident in taking on this task. If you are a recent “graduate” from your residency program, starting a new practice is not an easy process and does take some level of experience.
  
  Other suggested questions include:
   

• Can I interview with a key physician(s) that would be in a similarly situated need for referrals or market position to the one that I am being asked to fulfill?
   

• When was the last physician recruited into the market that performs the same services that I will provide? How busy is this physician?
   

• If you need support for your specialty services, i.e., sleep lab etc., can you provide the business plan to demonstrate a readiness to start this service upon my arrival?
   

• Who will participate in my interview process?
  
  Call is a critical issue for every physician. Understanding who will be your call partner(s) needs clear identification. These physicians should be part of the interview process to make certain that clinical compatibility can be achieved. Also, hospitals that do not have a well organized physician group might be lacking in other employed physicians to assist in an interview. A hospital that is mature in the employment of physicians will have a formal medical group structure which would include a practice administrator, physician leader for the medical group as well as other physicians that participate in a leadership role. If this structure is present, it would also indicate that other necessary support is in place to have a successful practice. This would include competent practice management, billing and coding staff. Others that should routinely be part of the interview process would be the hospital Chief Executive Officer as well as the Chief Medical Officer. It would be of value to meet with the CFO if that could be arranged. A red flag for your awareness would be if you are interfacing exclusively with a hospital service line manager. This would indicate that infrastructure to support your practice is poor or nonexistent.
   

• Do you have a physician leader of your employed medical group?  If so, will he/she be part of the interview process?
   

• Will I be meeting with the senior administrative person that supports or sponsors the employed physician concept?
   

• Could you provide a clear demonstration of how call will be covered for my practice?  I also would like to interview with my call partners.
   

• How do you manage physician compensation?
  
  Hospitals that have maturity in physician employment will have a standard philosophy and methodology of how to manage physician compensation. It might seem right to freelance compensation negotiations. However, negotiating from a position of no structure indicates that the hospital does not have a consistent philosophy of compensating employed physicians. This would also indicate that compliance in meeting employment agreement requirements might not occur. If the hospital employs a number of physicians, and compensation is built on individual negotiations/outcomes, it becomes quite difficult to track the performance of all contract arrangements.
   

• Can you show me your compensation plan for your employed physicians?
   

• Can I meet the individual that manages physician compensation?
   

• Do you have a new physician mentoring process?
  
  A new physician that moves to the community has a lot to learn. Who to refer to, clinical services available in the community as well as a myriad of other questions will be prevalent to the new physician. Assigning a physician mentor to the new physician is a value-added benefit offered by a hospital. This also indicates that the hospital has a keen understanding of what it takes to work with employed physicians. If this service is offered by the hospital, you will most likely have a long-term opportunity of practice success.
   

• Can I meet a physician that is or has been involved in the mentoring program?
   

• What is your retention rate for recruited physicians?
   

• Can I see your orientation plan for new physicians?
   

• Who will my spouse or significant other meet?
  
  For those who have been involved in physician recruitment, it is known that attention to the spouse in the interview process is critical. Gender makes no difference. If the fit to the community is not met, then the retention of the physician will be diminished. This portion of the interview is greater than touring the community and meeting other professional spouses. This could entail active assistance in searching for employment opportunities. Also, if your children have special needs, understanding the community offerings to fill these needs will be critical.
   

• My child has special needs (i.e., health, academics, sports, etc.). Can you assist in meeting a person that can answer questions in regards to these services?

Summary

There are many other components to a successful interview process. However, these are the most critical components for a physician to understand when seeking hospital employment. Lastly, if you find the right hospital and are hired, it is critical that you get all of your employment paperwork completed and back to your new employer. If insurance credentialing is not done on a timely basis, you will be confronted with not being able to see patients upon you arrival. Getting employment/credentialing paperwork back to the hospital is a key indicator if you are the right fit for their organization. Employment opportunities have been withdrawn or delayed over just this issue.

If you have any questions or comments about this article, please contact Jim Hamilton of Somerset's Health Care Team.

Health Care Commentaries is provided by Somerset’s Health Care Team for our clients and other interested persons upon request. Since technical information is presented in generalized fashion, no final conclusion on these topics should be made without further review. For additional information on the issues discussed, please contact a member of our Health Care Team. This document is not intended or written to be used, and cannot be used, for the purpose of avoiding tax penalties that may be imposed on the taxpayer.

Somerset CPAs, P.C.
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Indianapolis, Indiana 46240
317.472.2200 • 800.469.7206 • FAX 317.208.1200
http://healthcare.somersetcpas.com

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