The Benefits of Hiring Residents
November – December 2004
The shortage of qualified physicians is a well-known fact in the health care community. According to the American Medical Association, a number of factors point to “an imminent physician shortfall.”1 Given this shortage, physician recruiters are challenged to be more creative and resourceful in filling staff positions. One means to answer the challenge is to recruit more residents who are completing their training programs and are ready to begin full-time work.
To put the matter in perspective, it’s important to point out that hiring experienced physicians is the backbone of any competent recruitment program. A convincing argument for hiring seasoned practitioners was made in an earlier issue of Recruiting Physicians Today.2 Without doubt, doctors who have worked five or more years typically possess a wealth of clinical experience, have well-honed patient interaction skills, and have demonstrated notable success in revenue production. In addition, when they do accept a new position — especially requiring relocation — they tend to stay longer once they settle into the community.
To balance the discussion, this article makes the case for hiring qualified residents based upon the financial and practical benefits that ensue as a result.
Financial Benefits
For starters, hiring recent residents offers a chief economic benefit. Simply put, they are less expensive to hire and relocate than established physicians.
With limited professional experience, residents are at the bottom of the compensation scales, as various salary surveys point out. Couple these statistics with the fact that residents are on a longer track to partnership, and at least theoretically, can offer more years of service to the practice. What this suggests is that hiring residents can result in a substantial return on investment (ROI) for health care employers.
Furthermore, relocating residents, many of whom are single and living in apartments, is less costly than relocating doctors who are, for the most part, homeowners with families to uproot. This cost differential, multiplied by the number of hires over a couple of years, can reflect a significant savings in the physician-staffing budget.
Another cost savings relates to company-paid benefits. It’s easier to insure doctors who are young, single, and healthy, in comparison with veteran physicians who are experiencing age-related health issues.
Not having to pay sign-on bonuses to residents — or paying smaller bonuses — is another important consideration. Typically, hospitals pay sign-on bonuses to experienced physicians, not doctors just completing their residency. (The exception might be in rare medical specialties that have a steep supply-and-demand curve.) The savings of not paying sign-on bonuses over a period of time also contributes to shaving aggregate recruitment costs.
Another important factor deserves mention. Younger doctors who fit the “Generation X” profile often place importance on considerations other than just initial salary. GenX docs, born between 1964 and 1980, are attracted to practices that offer flexible work schedules, the latest technology, clear opportunity for advancement, and other perks that support quality-of-life concerns.3
This being the case, GenXers may be receptive to more “creative” compensation packages, including the trade-off of slightly reduced compensation in exchange for minimal on-call responsibilities, flexible office hours, comp time, or job-sharing options.
Compensation expectations factor into the equation in another way. Residents are more open to compensation plans formulated on base salary plus production instead of straight salary. Eager to prove their worth to the practice, they are willing to consider “back loaded” compensation arrangements.
Practice Benefits
Apart from financial benefits, there are other practical advantages for including recent residents in a comprehensive staffing plan.
For one thing, hiring younger physicians contributes to a more diversified workforce. Patients and administrative staff like to see younger doctors working hand-in-hand with more seasoned physicians. Observing a mix of older and younger physicians is both comforting and appealing to most patients.
Some recent residents fall into the category of the “best and brightest” among their peers. They have been trained to use state-of-the-art medical equipment, they have sharpened their clinical skills while working alongside prominent academicians, and they are, generally speaking, quite technologically savvy. Adding a fresh perspective to quality health care delivery, these budding physicians are an asset to any health care organization.
Younger physicians are eager to prove their worth as full-time employees. They are all too accustomed to working long, grueling hospital schedules, with heavy on-call responsibilities, for minimal remuneration. Now that they can “earn some real money,” recent residents are anxious to demonstrate their capabilities as full-fledged staff physicians. For the most part, they are quite ambitious and want to succeed in a thriving practice. Furthermore, their drive and enthusiasm are contagious for anyone working around them.
Planned transitioning is an important part of physician staffing. Specifically, doctors who are launching their careers can help the practice grow, and later they can be groomed to replace older physicians who are looking forward to retirement. Careful transitioning contributes to workplace stability, which is definitely an asset for any health care organization.
Hiring residents also helps to keep the pipeline open for recruiting other physicians. As they rotate through different medical specialties, residents interact with a wide variety of doctors who are at different stages in their professional development. Some of them are passively or actively job hunting, and would possibly entertain a hospital recruiter’s phone call. Newly hired residents can serve as an important communication conduit for bringing interested parties together.
Recruitment Strategies
A successful recruitment program targeting residents should include a comprehensive approach to reach the most desirable candidates. Several practical approaches deserve mentioning.
- Establish relations with directors at leading residency programs across the country. They can recommend for employment consideration upcoming graduates who might have an interest in your location and practice opportunity. Speaking with program directors at professional gatherings and mailing them information concerning projected staffing needs are ways to strengthen the relationship.
- Invite outstanding residents to a “career open house,” perhaps held at your hospital twice a year. This gesture will allow residents to meet the professional staff, view the facility, and get a feel for the local community. Taking this a step further, it may be fitting to link residents who are sincerely interested in your organization with established physicians who can serve in a quasi-mentor role and help them make the right employment decisions.
- Offer special incentives to the most outstanding residents who are considering your practice opportunities. Depending on hospital bylaws, it may be permissible to extend special recruitment incentives to get residents to sign on the dotted line. Examples: offering educational loan repayment assistance, subsidizing a sabbatical (after a few years of service) to pursue a fellowship, encouraging more CME courses geared toward medicine and technology, and permitting more flexible work arrangements, such as job sharing.
- Target out-of-state residents who have family ties to your community. If they have established roots in the area, such as immediate family or in-laws, chances are they will be more satisfied with their practice selection and will be more stable as an addition to the staff.
Recruiting residents is not the total solution to meeting a hospital’s staffing requirements. However, as part of a comprehensive recruiting program, it can result in quality hires that make a strong contribution to the medical practice.
- Victoria Stagg Eliott, “Physician shortage predicted to spread,” Amednews.com, Jan. 5, 2004.
- James Merritt, “The Role of Veteran Physicians in the Staffing Continuum,” Recruiting Physicians Today, Vol. 12, No. 2, March/April 2004.
- Mark C. Shields and Margaux T. Shields, “Working with Generation X physicians — GenX is here!” Physician Executive, Nov/Dec 2003.
Calvin Bruce serves as a senior staff writer for JCNationwide in Atlanta. He has previously written for RPT. Mike Flagg is director of Career Education for JCNationwide and visits residency programs throughout the country.
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