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Using nonqualified benefits to recruit and retain physicians
1Todd Organization, Inc., Bethesda, Maryland, USA. nolanm@toddorg.com
Summary
Healthcare financial managers can attract physicians with non-traditional incentives. Section 162 bonus plans, split-dollar welfare benefits, and discounted stock options offer greater value than standard salaries or retirement plans.
Area of Science:
- Healthcare Management
- Physician Compensation Strategies
- Financial Incentives
Background:
- Healthcare organizations face challenges in physician recruitment and retention.
- Traditional incentives like salary increases and qualified retirement plans may be less effective due to tax implications and regulatory limits.
Purpose of the Study:
- To explore alternative financial incentives that can effectively attract and retain physicians.
- To identify compensation strategies that offer greater perceived value to medical professionals.
Main Methods:
- Analysis of non-traditional physician compensation structures.
- Evaluation of Section 162 bonus plans, split-dollar welfare benefit plans, and discounted stock option plans.
Main Results:
- Section 162 bonus plans can offset tax burdens for physicians.
- Split-dollar welfare plans allow shared benefits of life insurance policies.
- Discounted stock options provide significant compensation growth potential.
Conclusions:
- Alternative incentives like Section 162 plans, split-dollar welfare benefits, and stock options are more attractive to physicians.
- These strategies can enhance physician recruitment and retention efforts in healthcare organizations.