There’s no shortage of articles on the physician shortage in the US…pun intended.
For example, a recent report released by the Association of American Medical Colleges (AAMC) declared that the U.S. faces a projected shortage of between 37,800 and 124,000 physicians within 12 years.
According to a 2022 report by Kaufman Hall, hospitals and health systems are boosting retention efforts. The Kaufman report states “100% of respondents say they have adopted some type of recruitment and retention strategy, with 98% reporting raising starting salaries or minimum wage, and 67% seeing wage increases of more than 10% for clinical staff.” According to a 2022 provider retention report by Association for Advancing Physician and Provider Recruitment (AAPPR), 54% of organizations surveyed do not pay retention bonuses and 85% reported having signing bonuses tied to a payback period.
It’s worth asking the question: What is the fair market value of a signing bonus and a retention bonus? My stance on the retention bonus is that it should be treated as normal compensation (included as base salary) and viewed as part of the total annual provider compensation and matched with productivity.
According to the Merritt Hawkins (MH) 2022 provider incentive report:
- 92% of MH searches offered signing bonuses for physicians
- The average signing bonus for physicians was $31,000 and the high was $400,000
- 78% of the MH searches offered relocation allowance
- The average relocation allowance for physicians was $10,718 and the high was $30,000
Remember what your mother told you when you were young; “just because everyone else is doing it doesn’t make it right…”. Well, in this case, it might be…