Need to Know Items About Your Physician Signing Bonus
Signing bonuses are an important incentive for doctors to join clinical care teams. These financial incentives are increasing in many markets because the physician shortage affects both specialty and primary care. An article in Verywell Health suggests doctor bonuses are now hovering around $20,000 or higher in some markets. The same article also mentioned non-physician providers are also receiving signing bonuses.
This article will look at the phenomenon of signing bonuses for doctors and whether they should be an expected part of compensation for the foreseeable future. How much can a doctor receive, and how can they use the bonus as a negotiation tool when considering a new position?
Understanding the Signing Bonus
The healthcare market for doctors is increasingly competitive, so today the majority of difficult-to-place roles come with a signing – and sometimes a relocation – bonus. If a clinic or hospital is working hard to attract a doctor, it is very likely they will sweeten the deal with a bonus.
Typically, a signing bonus is a one-time reward for accepting a new position. This compensation is separate from your regular salary. If you receive a raise over your basic salary at the one-year anniversary, the bonus is not usually figured into the annual raise metrics. For example, if your salary is $150,000, you received a $10,000 signing bonus, and you’re given a five percent annual raise, the five percent would only be on the $150,000.
These one-time rewards may not be paid out in a lump sum. Each situation is different. Some options we have seen:
- Lump sum on sign.
- Lump sum when you show up for first day of work.
- Half when you start, then half in 90 days.
- Half at 90 days and half at six months.
The third and fourth examples could be considered a “signing and retention bonus.” Remember, the organization wants you to stick around, not take the money and run.
Be inventive. Negotiate for a retention bonus before you sign. Ask for a bonus to be paid upon your one-year anniversary. Feel confident in asking for it.
The bonus is taxable income. You may be able to negotiate for the hospital to also cover the tax. You should have your lawyer review the contractual agreement and bonus structure. Even the smartest of doctors have made bad employment decisions, so make sure to get the advice of someone you trust.
Finally, keeping in mind that the demand for doctors is increasing, if no signing bonus is offered upfront, you should consider it part of the employment negotiation process and ask for it.
While there is no guarantee a signing bonus will be offered, the more competitive the specialty area, the more likely you’ll receive a bonus and the higher it will be. Smaller facilities are just as likely to offer this form of compensation because they are competing with larger facilities.
Doctors should talk to their recruiters about receiving the signing bonus as part of the overall compensation package. The recruiter should be willing to go to bat for you. Chances are you will receive it. At MedSource Consultants, we are standing by to help you achieve your goals and push for the best bonus possible. Contact our medical staffing experts today.