Are you considering hiring an associate dentist or physician? How will you know your practice is ready? While finding the right time to bring on an additional associate physician or dentist is highly personalized, there are a few indicators to watch out for.
In this article, we’ll explore signs it’s time to hire and other important employment details, including compensation and cultural considerations.
Three Signs Your Practice Has Outgrown Its Capacity
The first indicator that your practice could benefit from hiring an associate are patient wait times. How far out do patients need to schedule appointments? If the soonest you can fit patients into your calendar is over four weeks out, it’s time to hire another physician or dentist.
The second sign is revenue plateaus. Doctors can only take on so many patients. If your schedule is maxed out and revenue begins to plateau, consider bringing on an additional doctor to continue growing the practice.
Finally, if you are feeling burned out, start the hiring process. A recent doctor job satisfaction study found that 45.2% of respondents reported at least one symptom of burnout. Burnout can not only affect the practice financially, but it can have devastating impacts on patient satisfaction and overall care.
Financial Benchmarks to Consider Before Hiring an Associate
If you are facing one or all three of the above indicators, it’s important to check your financial stability before starting the hiring process. First, look at your overhead costs: which of these will go up because of this hire? The addition of hiring another provider does not carry the same overhead ratio since a lot of those expenses won’t change or only change slightly! Generally, the main cost factor is the cost of the associate physician or dentist salary? Be sure to consider all costs, including payroll taxes, benefits, base compensation, and bonuses. Remember, revenue will likely increase with the new hire.
Employees vs. Independent Contractors
There are two types of workers: employees and independent contractors. Employees work for your practice, with your practice providing resources, setting compensation, and offering benefits. On the contrary, independent contractors work for themselves, bringing their own equipment and setting their own schedule.
Most associate dentists will be employees of your practice. However, if the associate dentist or physician has complete clinical and operational autonomy, they may be classified as independent contractors. It’s always best to consult with an accounting professional if you are unsure how your new hire will be classified.
Top Compensation Models
Compensation is a major decision when hiring an associate dentist. Too low of a salary, and the physician or dentist may pursue other opportunities. Most compensation models are based on a fixed salary or gross revenue, with bonuses and incentives added in. A fixed salary will mirror market rates based on the geographic location, while gross revenue is based on the amount of patient revenue the dentist or physician earns.
Some practices will choose one or the other, while others may elect to have a hybrid method. For example, a set salary with a bonus-type incentive plan based on production revenue.
Cultural and Operational Fit Considerations
While everything may check out on paper, it’s important to consider the cultural and operational fit before moving forward with hiring an associate dentist or physician. How will they fit in with your existing staff? Does your practice have the capacity and operational space to support another dentist? How will you transition patients over to the new dentist? Will patient care be impacted by growing operations? Evaluate all cultural and logistical aspects of hiring another physician or dentist.
When to Bring in Advisors
Advisors can be a key component of successfully adding another associate physician or dentist to your practice. Accountants can help you determine the financial impact, while attorneys can create legal contracts and human resources can figure out a mutually beneficial pay package. Each of these professionals plays an important role, making them great additions to your team in the beginning stages of the hiring process.
Summary
Hiring an associate dentist or physician comes with dozens of considerations, from employment type and compensation models to cultural and operational logistics. If you’re unsure where to start, consider practice operations consulting from a professional. If you have questions about when the right time to hire an associate physician or dentist is, please contact us.