One question med students have is the average salary for a resident physician. After a physician graduates from medical school, they move on to an internship or residency within their specialty. Then earn. But for most of them, it’s simply not even remotely enough for the work that they’re doing. So, it’s not uncommon for residents to work 70- or 80-hour weeks. The average salary for residents in the United States is around $63,000. Maybe you’re a resident right now, thinking, I don’t even make close to that, or maybe I make more. This is average across all specialties. Some specialties will make a little bit more than others.
Leverage in Salary Negotiation
Some could be as high as the 60s. Whereas maybe in family medicine, you could be about 50s. Can residents negotiate their salary during training? No, they have no leverage. Anytime you’re negotiating a contract, you base it upon leverage. Even those residents coming out of training and moving on to their first employed job don’t have much leverage either. The only leverage they have in those situations is if they’re in a needed medical specialty. Or two, if they’re willing to go to an under-served geographic area and need physicians.
So, around 63,000 is the medical residency salary. If you think of it this way, if they work 70 to 80 hours a week, they’re making about $15 hourly. And providing care as a doctor for $15 an hour. Now, once they move out of training, the salary increases substantially. And for some specialties could be an eight-fold increase, at least just coming out. But that’s what it is. One consideration we make when reviewing and negotiating the residents or fellow’s first contract. Most of them don’t have a ton of money coming out of training.
Importance of Relocation Assistance
So, suppose the new employer is offering a signing bonus or relocation assistance. In that case, we want to ensure they’re getting a chunk of that before moving and starting the new job. Wherever, if they are moving from where they’re currently training. Simply most residents, especially if they have family, maybe the only breadwinner. At that point, they don’t have $10,000 to $15,000 if they’re making a cross-country move. So, we need to ensure that either the employers pay their moving costs directly to the moving company. Or they’re going to front the money before the physician needs to spend it on the move.
In that way, they don’t have to outlay a ton of cash. Because it certainly is expensive moving from one place to an entirely different one. Medical residents certainly are underpaid. Unfortunately, it’s part of the process they must go through to be fairly compensated for the services they provide. But it’s just tough when you’re making that little. And I think the average physician has about. I think 47% of physicians have student loans over $200,000. It could be a big burden.
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When Should a Resident Receive a Signing Bonus?
When should medical residents receive a signing bonus? The timing of it is essential. When medical residents finish training, they have likely already signed an employment contract. More importantly, when negotiating the contract, usually in their early PGY-3 year, some PGY-2. When they receive the signing bonus is crucial for a couple of factors. One, as physicians in residency, don’t make much money. Say they’re training in New York and get a job in California. Depending on their family size, moving across the country could be a substantial amount of money.
Almost every employer someone signs with as a resident will offer relocation assistance. Usually, between $5,000 to $15,000. You won’t see above $15,000 as far as relocation assistance goes. Somewhere along there, they should pay for the entire amount, to be honest. And some people moving a short distance can also use the relocation assistance money for traveling back to the city. To look for an apartment or a home. So, airline lodging, all that kind of stuff. Some people could use that money for a security deposit or maybe the first couple of months’ rent. Most employers are flexible in what the physician can use that money for. But they want it to be housing-related or relocation-related in some manner.
Negotiate To Get The Amount of the Signing Bonus You Need
Now, the timing of when you earn is important. Usually, the physician will receive different offer bonuses. One would be the relocation assistance as I said before, somewhere between 5,000 to 15,000. And also, a signing bonus is usually paid out during their first resident pay period. Whenever they get paid first after they start with the employer, that’s when they would receive the bonus. There’s a different way of doing it. Often employers will say, unless it’s a big hospital network that has established relationships with moving companies. Let’s say you’re running a private medical practice. They’ll say, pay your moving expenses, submit us the receipts, and then we’ll reimburse you. Well, for some people, outlying $10,000 to $15,000 to move is difficult. Simply because, as I said before, you’re not a wealthy doctor when you’re still in training.
So, we assess the situation for the physician and determine if it is helpful if you get this before moving. How soon before you complete training do you need the money? We can say to the employer, “Hey, look. It will help us defray the cost of the move if we receive this before moving.” Or, more importantly, maybe the employer would be willing to pay the amount directly to the moving company. In that way, there’s no cash outlay by the physician, which is the entire point of that. The signing bonus also. The timing of when the employer pays it can be essential as well. Depending upon the size of the signing bonus, we could say, we would like half upon execution of the agreement.
Discuss Resident Physician Repayment Obligations
So, when you sign the actual agreement, and both parties sign it, that’s called the execution of the contract. Many times, we could say, we’ll get half upon signing. And then the other half when they start. Both bonuses will have a repayment obligation tied to them. At least it usually would. This means that, let’s say, the physician has an initial two-year term. The employer states, that you’ll owe us a prorated portion of the bonuses if you leave before the initial two-year term. It could be quarterly forgiveness, monthly forgiveness, or yearly forgiveness. Let’s say someone has a $30,000 signing bonus. They say, alright, half of it is forgiven after the first year. And the other half is forgiven after the second year.
So, if the physician left between the first and second year, they owe back $15,000. So, the employer is insulated from the physician, simply taking the bonuses early. And then, splitting out on the job by signing the agreement in advance. There’ll be language in there that talks about the repayment obligations. If the employer is expressing concerns about that. Or maybe they just don’t utilize that. That would be a good way of saying, look, if you’re concerned about me, just take the money, and leave.
Then let’s put in these repayment obligations and therefore, you’re protected if I were to leave. And I benefit by getting the money in advance. So, that’s a discussion of when the physician in residency should receive the signing bonus or relocation assistance. It’s just dependent upon the situation for some people. It’s fine receiving it after the fact. But for others, it’s important to have it up front—just some things to think about.
Contract Negotiation Tips for Resident Physicians
Today I will talk about contract negotiation tips for resident physicians. An actual employment contract, not a resident agreement, is something that no resident has much knowledge of in my experience. I mean, a large percentage of my contract reviews are with residents or fellows just coming out of training. They have this 20-page contract. They have no idea what should or shouldn’t be in it. Or what the terms are. That’s a large majority of people that contact me. We just kind of work through, okay, what is in here? What also comes up is, well, what is the strategy behind negotiating a resident’s first employment agreement?
What to Expect for Residency Salary
I wish I could give a one-size-fits-all analysis, but I can’t, so we’re going to work our way through it. First, any negotiation is simply based upon leverage. Does a physician have leverage or not? And this goes for any negotiation. The individual or entity with the most leverage can get better contract terms. In some specialties, a physician coming out of training doesn’t have leverage. Those specialties would be any medical specialty where one has to build up a patient base. Primary care, peds cardiology, dermatology, anything where you’re not just doing shift work in the hospital, or maybe some surgery. That type of thing.
If you’re not from the area, you have no ties to the area. You have no existing patient base. There’s not much value you provide to the practice as if you were. Let’s say you were an established physician in the area. Then you have an established patient base and a referral network moving to a new practice. You have much more leverage because you’re bringing in a large patient base. If you’re in a medical specialty where you must build it up to practice, usually, that takes 12 to 18 months. That means you won’t be that profitable in year one. You don’t have as much leverage to get the type of contract that you may necessarily want.
Now, that doesn’t mean you don’t have any leverage. Some practices have an absolute need for a new physician. And the reason why that would be is one, there are just volumes that are so high, they need help. Or two, they could be in a location that’s hard to staff.
Consider the Location
Rural communities are always tough to staff to. I guess the weather also affects that. If you’re moving into a hard-to recruit community, you have more leverage immediately. One misconception is that the salary doesn’t normally reflect the salary for physicians moving into high-cost living areas. I’ll use my hometown, Scottsdale, Arizona, as an example. Scottsdale is a very desirable place to live. It’s a great suburb of Phoenix. The weather is great, and many people want to live here. Because of that, the salaries are depressed a little bit, simply because more people want to live here. The same goes for California, San Diego, and LA. Like the warmer climate locations, Miami and Florida. They have more competition amongst physicians for those jobs, giving you a bit less leverage.
Reply Appropriately to Contracts with Facts
Some tips on how to get beyond that. One, you need to talk to your classmates, those in your residency, maybe those in fellowship. What do your job offers look like, and what are they offering you? What’s your base salary, the signing bonus, and benefits? Lastly, what’s the productivity compensation down the line? Get in there and compare offers from the other people in your residency program. This data gives you a better idea of the average base salary the employers are offering.
Two, if it is a difficult site to recruit, you must let them know you understand. And say, I’m not trying to be a jerk, but I don’t necessarily have to live here. I have no family here, no community ties. It’s remote. Because of those things, I would expect to make a little bit more.
You can attempt to Google some of the industry-standard compensation surveys. The MGMA and some of that data are not available to the public. But you’ll usually find a couple of years old, giving you a better indication that this is normal. Now, the comp in there, the comp averages, and those surveys are averages. So, it’s not just residents. People coming on training too. It can be people that have been out for 20 years. You need to take that into account as well.
Other Ways to Get More Leverage
A great interview, coming off as a normal person, easy to work with, are things that make someone desirable too. If I’m hiring somebody in my law firm, it’s someone I think is easy to work with. If the culture shows an ability to adapt, I’m much more likely to offer them more than I would. Or if it’s someone that’s kind of super Hi-Q, maybe super-strong academically with writing skills. But a little more socially awkward. Most places don’t want that. They want someone that will be easy to work with and a good fit culturally. Those are some tips on how to negotiate a resident contract.
How Much are Fellowship Physician Salaries?
What is the average salary for a physician in fellowship? At the basic level, after a physician graduates from medical school. They go into an internship and then a residency program in their medical specialty. And some specialties require extra training. That’s what’s called a fellowship. Depending on the specialty, most fellowships last between one and three years. After that, they can move on and have an employment relationship where they can practice in their medical specialty.
Average Physician Resident and Fellowship Salary
Is there a huge difference between residents and fellowship salaries? The answer is no. There isn’t. The average resident salary they can earn is around 63,000 a year. Now, that’s the average. So, there will be some lower than that and some higher. It’s specialty-dependent.
I think the average for family medicine, the physician in training in the residency makes around 51,000, and then maybe some of the surgical specialties can be in the high 60s. But you logically would think, alright, if I’m going to get through residency and move on to my fellowship, I’ll make more money. And the answer is not really. The average fellowship salary is about the same as the average resident salary. Now, the fellowships, anyone who must move into a fellowship is on the higher end of a specialty. So, if the range is between 50 to 70, they’ll be higher towards the 70 range. But there will not be a significant jump between the money people make as residents and the money they make as fellows.
Moving Expenses and Bonuses
One word of advice if you are coming out of a residency or fellowship. When you have a new job offer after you are either done in your PGY-3 or your fellowship, people in training are not flush with cash. And so, almost any employer will offer the physician a signing bonus, relocation assistance, or both. But most of them will have language in the contract that states they will either reimburse the physician once they start or they will offer the signing bonus with their first paycheck after they’ve begun providing care. That can burden some physicians who don’t have $10,000 to $15,000 to move.
A Physician’s Contract Must Have This Written in Their Agreement.
Suppose a physician has a family and they’re living in New York. If they get a job in California, it can easily be $15,000, and sometimes having to pay that out of pocket at the beginning can be an enormous financial burden. So it would be best if you made sure that any of these languages are in your contract:
- Your contract will state that the employer will pay the moving expenses directly to the moving company before the move.
- You will get that money before moving so that you can use that for the moving expenses.
- You can use a portion of the signing bonus to do that.
- And then most contracts will have language that states that if the physician leaves within the initial term, they’ll have to pay back a prorated amount of those bonuses, which I think is fair.
If they’re going to outlay the cash up front, they certainly don’t want a physician to leave after a few months and take all the bonuses with them. A physician in fellowship is around mid $60,000. I think 47% of physicians have over $200,000 in student loan debt. And then, if you think that they’re working 70 to 80 hours a week, which some of them are, it works out to be like $15 an hour, which is tough to support a family at that point.
How Should a Resident Physician Look for a Job?
How should resident physicians look for a job? Literally, what steps should they take to find a position they’ll be satisfied with? The timing certainly is important. Most physicians generally start looking for positions early in their PGY-3 year. Some specialties will even sign contracts in their PGY-2 year if they’re not going into fellowship. If a physician is moving from residency into fellowship, they usually won’t start looking until the end of their last year of residency, or maybe it’s a multiple-year fellowship. Maybe at the beginning of the last year of their fellowship as well. There are several ways medical doctors can find jobs.
How Physicians In Residency Can Look For A Job
The easiest way I’ve found is through colleagues. If you’ve trained with somebody, they’ll usually have information about a place that is recruiting. Or maybe they joined a practice. And they say it’s a great environment that we’re looking to add another physician in a specialty. Maybe you should look at it. Now, that can vary wildly in location, and location is very important to some, while not important to others. So, it can go all over the place if you get leads from fellow residents or fellows. One way is to talk to colleagues, mentors, or other people you’ve met in training. And that’s also a great way of determining the market value at the time. The MGMA data is like an annual physician compensation survey across the nations broken up into geography, specialty, and physician-owned versus hospital-based physicians. In some specialties, the sample size is so tiny.
I don’t think it’s a great tool. Other specialties can usually be a pretty good gauge if there are hundreds and hundreds of responses. I don’t think any physician should base a job search solely on compensation. I think that’s shortsighted. Anyone coming out of training needs to be in an environment where they can learn. Or they’re going to have mentors where they’ll feel safe and have an opportunity to grow.
I often see it, especially in rural environments, where they need a specialty. They’re willing to throw a bunch of cash at somebody. But they’ll be the only ones in their specialty out there. Like there’ll be no others, no one to learn from, train with, or pick someone’s brain, at least locally. Those scenarios are tough. Some medical doctors can thrive in that environment, but it’s more complicated for others. So, I think they need to consider that.
Physician Employment Recruiters
Any physician contract is going to have without-cause termination. If a physician is unhappy in their practice, they usually provide 60- or 90-days’ notice. And they can move on. Even if you’re in a job at the beginning, you’re not stuck there forever. You can find something better. I mean, I find a lot of physicians coming out of residency or fellowship will take the first job. And then they’d say, alright, now I know what I don’t want. So, they can look for work more appropriate to the practice they’re looking for.
Another way is through physician recruiters. There are two types of them. You have in-house recruiters. Many big hospital networks employ physician recruiters who attend different residency programs. Maybe there’s a job fair, something like that. Or they’ll specifically reach out to people in training, saying, hey, I have this opportunity in this place. Would you be interested? They’re free to physicians. You do not have to pay the recruiter or anything. The employer is the one that pays the recruitment fees.
So, physician recruiters. Both in-house and those that are just a private group where they just go out and broker these deals. Typically, they would get a percentage of the first-year salary of the physician, or maybe a flat fee. Something like that. But there’s absolutely no harm in discussing positions with recruiters. It’s a usual way of doing business nowadays. They usually have their ear to the ground and have information on many different opportunities that could be exciting for physicians.
Physician Job Search
Another way if you have a specific region in mind. It’s just doing job searches for practices in your specialty in one specific area. Most places will have job posts on regular job sites if they’re looking. Then you can search for those in the city you want, find that, and contact them from their work listing.
That’s another way. So, those are the three biggest ways. Word of mouth through colleagues, doing it through a physician recruiter or searching in specific cities through job search websites. Now, for those who are maybe J-1 or something like that, that’s like an entirely different kind of job search. And I can do a separate video about that. But this is more geared towards those looking for the normal position just coming out of training.
Can you Moonlight in Residency?
Can residents moonlight during residency? The short answer is that it depends on the program and the signed residency contract. The assurance that most residents sign before starting into the residency program is not like an employment agreement that you will sign once you’re finished training and then earn your first job offer. It’s usually much shorter and doesn’t cover the usual terms that an employment agreement will cover.
However, there might be some language in that residency contract that states you cannot do outside activities without employer approval or program approval.
What Are the Requirements Needed for Moonlighting?
If you have language in your contract that states you must get approval to do any outside employment, then that’s what you need to do. It would help if you had to get written authorization that says, yes, the medical program is okay with you doing this. And then you also consider several different things.
One, your professional liability insurance is not specific to you. It’s particular to the employer. So, suppose you’re working in a residency program. In that case, any activities you do in that program are covered by that insurance policy. However, if you were to moonlight or work anywhere else, you would need a separate professional liability insurance policy that covers your activities for that new employer.
One policy doesn’t cover you in whatever you do. It would be best if you had a specific procedure for each employer. Now, if you are moonlighting, whoever you’re moonlighting for will cover your professional liability insurance. And then you also need to consider whether, once you leave the moonlighting position, they will pay for your tail insurance if there’s a claims-made policy. I have several blogs about claims-made coverage and tail insurance for medical practitioners.
Avenues for Moonlighting Based on Physician’s Position
I’m not going to get into it in this blog, but I would also consider it. The specialty is also essential. You’ll usually have a lot if you’re in a shift work type position like ED, hospitalist, or any IM position. You could do urgent care. There are a lot of different avenues for you to moonlight. Same with surgeons as well. But most programs are okay if the resident does moonlight. If one, they ask for permission. Two, they ensure professional liability insurance at that new position. Then three, they don’t want any moonlighting to interfere with the resident’s schedule or duties with the program.
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