"M3 Global Research is collecting opinions on treatments and medical practices. Get compensated for sharing your expertise with M3 in paid medical surveys and enjoy an additional welcome bonus"

The spectrum of work types for physicians

Published by

Freelancers, Consultants, Contractors, Employees, and More!

“You need to go to school and study hard so that you can get a job!” said every parent everywhere. Even into adulthood, we have this vision of an ideal life in our heads. It involves having a job that we commute to, and work there from early- or mid-morning until sometime in the late afternoon or early evening, Monday through Friday, for about 49 or 50 weeks every year.

As physicians, we’re even harder on ourselves than other professions. Many of us think it’s normal and expected to have a job in which we work more than employees in almost every other industry, and are on-call for many more hours than that.

A common alternative to this route for physicians is to start our own practice, but – for a variety of reasons beyond the scope of this post – opening a private practice has lost popularity. But this doesn’t mean we all need to accept the long hours, lots of call, and bounteous organization politics that often come with what we’re taught to think is a normal and necessary part of working.

Our Definition of a “Job” is Often Extremely Restrictive

This stereotypical interpretation of a job for a doctor is consistent with full-time, salaried employment. A company hires you to carry out a set of responsibilities and, in return, you get a set amount of money every two weeks, and some perks like a retirement savings match, partially paid health insurance, a bit of vacation time, and free coffee.

To all physicians wanting an off-beat career on their own terms – rejoice! There are many more ways to work and be a bread-winner.

Employment

Salaried Positions

You’re almost certainly familiar with run-of-the-mill salaried positions. These jobs are typically known as ‘exempt,’ meaning that employers are not required to provide overtime pay. As a salaried employee, especially in a professional role, you are typically hired to do a certain job rather than work a certain number of hours. Depending on the position, the company culture, the ongoing projects, and the upcoming deadlines, you may need to work extra hours – sometimes on evenings and weekends – to carry out your duties. But you usually still get paid the same amount, no matter how much you work, or how much you slack off (within reason).

Hourly Positions

Part-time positions can also be salaried (but often don’t come with the fringe benefits of full-time jobs). Most part-time positions, though, and some full-time positions are paid on an hourly basis. You work for an hour, and you get paid for an hour. These are generally ‘non-exempt’ positions and the employer is required to pay overtime for work over 40 hours per week and must pay at least minimum wage. This is less common for physicians, but does happen, especially with atypical healthcare and medical jobs.

Independent Contracting and the Like

Independent contracting means you provide services to a company in exchange for a predetermined fee that is usually spelled out in a contract signed by both parties. Generally speaking, you have the flexibility to complete the work the way you deem appropriate, and you do it using your own tools, processes, and resources.

There are a few terms used to describe workers of this type that are often used interchangeably, but do have some key differences.

Independent Contractor – This is an individual or company that performs work per the terms of a contract. The work is not directed by an employer. The IRS has their own specific definition of this, as well, to make sure you pay your taxes.

Freelancer – Freelancing is a colloquial term used to describe a single person who sells their services to clients, often having several clients simultaneously. A freelancer is usually an independent contractor. A freelancer’s work typically has a tangible product that’s delivered (e.g. a piece of writing) or a distinct service that’s provided (e.g. an hour of tutoring) to the client.

Consultant – Consulting, like contracting, can be done by an individual or a business. It’s a broad term meaning to provide expert advice professionally. An individual working as a consultant is similar to a freelancer in the way the work is carried out and compensated. It’s the “advice” part of consulting, however, that sets consultants apart from freelancers. A consultant is likely to use their skills and knowledge to make suggestions to their client or provide a plan to solve a client’s problem. Sometimes their services include carrying out some or all of a plan or taking action on their advice, but not always.

Third-party Agencies

There are a number of additional, less common working arrangements that are worth a mention here. Temp agencies, employment agencies, staffing agencies, and locum tenens providers have various arrangements based on what type of organization they work with and who they hire. Many physicians prefer to be hired by and work directly with an employer or client, since this simplifies the logistics of hiring, contracts, and taxes, and because it takes out the middle man. Sometimes it’s reasonable to work with a third party, though. For example:

  • An organization may choose to not hire physicians directly, so a third party is your only option.
  • Without the third party, you’d be misclassified as either a contractor or employee.
  • The agency offers you something of value that the client would not, such as fringe benefits or credentialing services.

If you’re considering one of these arrangements, take the time to understand the relationship between the different parties involved and thoroughly read everything before you sign it (of course).

Work for Non-monetary Compensation

Most work done by a medical professional is compensated at either an hourly rate or a set amount of money per service or per project. But occasionally there are arrangements that compensate in other ways. This kind of setup is most commonly used in startup companies that don’t yet have the resources to pay workers competitively. They might be actively fund-raising, and might not even have a product that is available to customers yet.

Health- and medical-related startups often need the assistance of someone with a clinical background or expertise in a certain disease area. If a startup wants high-quality input from you as an experienced physician, you may get offered a small percentage of ownership in the company or shares in exchange for doing work for them. This may or may not come along with some amount of payment or salary. The startup phase is undoubtedly an exciting time to get involved with a business because you have the opportunity to truly influence the organization and its success. The risk is that your shares could end up being worth nothing.

The best advice I can offer here is:

  • Consider involving a lawyer if you don’t have a solid understanding of what you’re being offered.
  • Read the whole contract, and propose changes if necessary to meet your needs.
  • Never expect that the company will become wildly successful. If your shares end up worthless, is that okay with you? It might be, if you find value in the experience and skills gained. But if you’re depending on monetary reward, you may want to pass.

The point of all this is that if you’re looking to change to an alternative career in medicine, a non-clinical role, or want to work for yourself, you don’t necessarily need to quit your clinical job and look for full-time employment.

Making the Most of your Work Arrangement

Seek out other types of opportunities if they suit you better. Reasons to take a part-time or contracting role could be:

  • To continue to be able to work your regular, full-time job and earn extra income.
  • To have ongoing income while you get your own business off the ground.
  • To gradually make a transition away from a full-time position.

If a company sees your value, they might be flexible in the type of working relationship you have with them.

It’s possible you’ll come across a company seeking a full-time employee that looks like a great fit for you, but you’re only looking for part-time. Perhaps you can convince them that you can accomplish their needs in 20 hours per week. That would be a win for both parties. Or, maybe you want to be a contractor because you need flexibility in when and where you work. You might see if the organization is willing to outsource some of their work to you.

Use your judgement, though. Learn enough about the company and their practices to have at least a reasonable idea that they may be open to alternative arrangements. Read the job description carefully to be sure the responsibilities actually lend themselves to part-time or contracting work. Many positions truly do need a dedicated, full-time employee to successfully accomplish the duties.

IRS Rules

Also – big caveat here – the IRS has strict criteria for employee status and contractor status. From the IRS website:

You are not an independent contractor if you perform services that can be controlled by an employer (what will be done and how it will be done).

Many companies push the limits on this and never get into trouble. Moreover, physicians have set a precedent for frequently working as independent contractors, and the IRS acknowledges this. However, there can be serious consequences if they determine that a worker who should be an employee has been misclassified as a contractor.

This table sums up the big differences:

 EmployeeIndependent Contractor
Type of work performedWhatever is in your job description, as well as basically whatever else they tell you to do.Only what you’ve agreed on with the company, and hopefully it is spelled out in a written contract.
When the work is doneYou are assigned a shift or are expected to be working during normal business hours.You can perform the work when you want, as long as you meet deadlines or attend meetings that are agreed upon.
Who does the workYou do the work, or delegate it to your subordinates if you are a manager or supervisor.Unless expressly prohibited in your contract, you can hire subcontractors to do the work for you.
Who owns the workThe company owns the copyrights associated with products of your hard work and genius thinking.Depending on the type of work you’re doing, you may or may not own copyrights to your work. Be safe and make sure your contract clarifies this!
Work AssignmentsYour boss can walk into your office and tell you want to do next, or to stop what you’re doing and start working on something else, or that Project X now requires twice as many deliverables.You need to agree to perform work requested by the company. If the scope of work changes significantly, you have the right to require a new contract with revised payment terms.
CompensationYearly salary or hourly rate. You are handed a check or get a direct deposit to your account every two weeks or so.Can be an hourly rate, but is often a set fee for a specific service or project. You are responsible for sending an invoice to the company unless you’ve made other arrangements with them.
TaxesYour pay will have federal and state income, Medicare, and social security tax already taken out of it. The employer pays their share of Medicare social security tax.No taxes are automatically withheld from your pay. You are responsible for paying them, plus a Medicare and social security “self-employment” tax.
ExpensesEmployer covers or reimburses for work-related expensesYou are responsible for your own expenses in most cases, unless there is a specific reason or agreement for the company to cover them.
TrainingEmployer can (and should, if they’re good!) provide some sort of orientation when you start, training on company processes, and ongoing education if needed to keep up to date in the field and carry out your responsibilitiesYou are expected to have the knowledge necessary to complete the work. If you don’t, you are responsible for seeking out and paying for the training you need.
FeedbackYou should expect a yearly review (whether or not you actually get one is a different story). If your work is unacceptable, your boss will tell you about it and help you understand what you need to do to rectify the problem.If you feel that you need feedback on your work, you should tactfully inquire about the adequacy of your deliverables. If your work is unacceptable, the company has no obligation to continue a relationship with you.
Length of the relationshipYou work for the company for the foreseeable future, unless you resign, are laid off, or are let go. The company can only terminate you if certain conditions are met.Your relationship lasts only as long as it takes you to complete the work you agreed to. If it went well, hopefully they’ll offer you more work!
VacationEmployer allows you to take a certain number of days off each year, during which you earn your regular salary.You can take vacay whenever you want, as long as you get the work done when it needs to be done.
BenefitsCompany may offer benefits such as health insurance, retirement account, CME allowance, and gym membership discount.None of this. The benefit is working for yourself!  ?

See a theme in the Independent Contractor column? Contract, contract, contract! It’s the location, location, location of independent contracting work. Due in part to the flexibility to both the contractor and the company, the language in contracts for independent contracting services is particularly important. The government likes to protect the rights of employees, but they care less about independent contractors. So look out for yourself and have a solid contract in place.

I hope this has helped clear up the broad range of work types for medical professionals, and maybe helped to convince you that alternative work arrangements can result in the same (if not better) professional success and compensation as a standard, full-time position. Tell me about your independent contracting experiences in the comments below!

Subscribe To Personalized Notifications

You are subscribing to jobs matching your current search criteria.

Email Notifications

Email notifications will be sent to you Subscribe

 

Custom RSS Feed

Your personalized RSS Feed is below, copy the address to your RSS reader.
Subscribe