There are books and stories and formulas and methods of developing physician compensation mechanisms. But, unless you are a hospital system, you do not have unlimited funds. When you are a private practice, the money that goes out to one physician is potentially and often arguably coming from the pocket of another physician.

When you see all the sick patients, and your partner does the daily management, of course you should be paid, more, or should you? These are the difficult discussions that practices and administrators must wade through. As the practice scopes change, each physician’s workload and ability to contribute financially changes. Perhaps one physician is good at attracting referrals from other physicians, but the other is a technician that can perform the most delicate of surgeries with nerves of steel. Getting compensation “right” is one of the most difficult processes that a manager can approach.

Often it is joked that if an administrator wants to lose their job, they can start a building project or change the compensation plan. These have been proven over and over. There are books and books written, and we can provide you references, but the best process involves working through the difficult negotiations and getting everyone to agree that there is no perfect solution, but there is a best solution for your practice.

You need the help of a skillful facilitator to look you in the eye and tell you that what you are proposing is not fair and is not best for the business, even if that means your immediate paycheck is less. But looking out for the business instead of just one partner might be the best way to ensure a long lived healthy practice.

Our consultants can guide you through the process of developing a fair and defensible compensation structure.