What Doctors Can Expect During Physician Salary Negotiation

When it comes to the health of your patients, physicians are cool and confident under pressure.

When it comes to negotiating your salary for a new job, however, you might feel uneasy. Discussing the sensitive subject of money can be awkward.

As with any situation, knowing what to expect beforehand can help to ease some of the anxiety you might be feeling.

To help you prepare for this negotiation, we’ve created this guide to physician salary negotiation.

That way, you will come out on the other end of the negotiation process with a competitive salary and benefits package that meets your worth and needs.

Know Your Worth Before Negotiation

Before you begin any talk with a potential employer about compensation, you should know what you have to bargain with. How much leverage are you bringing into the negotiations?

When asked how much you would like to make, you don’t want to ask for less than you are worth, but you also don’t want to ask for so much that you come off as arrogant.


A bit of research on your part is all you need to figure out what would be fair compensation for you.

How Salaries are Determined

Several factors determine physician salaries. Of course, actual compensation is a decision met by both employer and physician, but these factors can have a heavy impact on that number:


Your specialty will be a major determining factor in how much compensation to expect.

According to the American Medical Association, among the highest-paid doctors are plastic surgeons, cardiologists, radiologists, and dermatologists. Doctors with the lowest income include pediatricians and internal medicine physicians.

There are many specialties and subspecialties in the field of medicine. Knowing where your specialty falls in the spectrum will help you in your physician salary negotiations.


Each state differs slightly in the average physician’s salary. Even where you live within a state can have an impact on your expected compensation.

Doctors in midsize and rural areas statistically earn more than doctors in urban areas merely due to the issue of supply and demand. Urban areas tend to have more doctors to fill positions so employers can do so even while offering less money.

Type of Practice

The type of practice that you are interviewing with will also determine how much they will be willing to offer you for compensation.

Hospitals and health care organizations often pay their physicians based on relative value units (RVUs). This is explained more under the subheading Physician Compensation Models.

Private practices and group practices, on the other hand, offer payment models that are greatly affected by the financial performance of the practice itself.

The size of the practice you are interviewing with can also determine how much you can ask for. Physicians tend to have more bargaining power with smaller practices.


Obviously, a physician fresh out of residency cannot earn as much as a physician with ten years of practice under their belt. The number of years in the field is a major compensation factor.

Physician Compensation Models

When applying for a position in an organization that pays its physicians based on a compensation model, it is essential that you understand this model before signing on.

The most common model is the wRVU compensation model. This model is based on physician productivity, incurred expenses, and malpractice insurance premiums. Our article on the wRVU compensation model will deliver a more in-depth explanation of this topic.

There are other compensation models used by some organizations that follow a rate based on patient satisfaction scores and productivity benchmarks.

Related: Provider Reviews: AMA Life Insurance Review

How Can You Be Sure?

With so many different factors to consider, how can you be sure that you’ve come to the right conclusion in your worth?

There are reputable third-party physician compensation reports that you can look at to find the fair market value of physicians with a situation similar to yours. These reports can be tedious to decipher but will give you a wealth of data to help you determine a number to ask for.

It would be wise to ask colleagues with similar circumstances to yours how much they would consider a fair number to ask for in your physician salary negotiations.

Even after reading through the reports and talking to colleagues, you may still feel unsure of your worth.  You can get help from advisors like us, who understand the market, to solidify your true bargaining power.

Related: The Definitive Guide to Physician Contract Review

How and When to Talk Numbers

Now comes the tricky part. Money is a sensitive subject, and many physicians struggle with how best to bring it up.

Nonetheless, it needs to be addressed. So how do you go about it as professionally as possible?

There should be a reasonable exchange of conversation before you dive into physician salary negotiations. Asking about how much you can expect in compensation too early in the process can offend some employers and can, in turn, make them less willing to compromise down the road.

Yes, this is a matter of business and should be undertaken as such, but you are still negotiating with people with feelings and intuitions. You want to present yourself as someone who is polite and easy to get along with. No one wants to hire a problematic physician.

On the other hand, you don’t want to allow negotiations to drag on without addressing the topic of your salary. During most negotiations, there is a natural flow to the discussion. The subject of compensation will come at the right time, so don’t force it.


When you do talk about money, explain that you are looking for a contract that fits the long term. This will not only show commitment on your end but also how important a good contract is to you.

You don’t want to agree to terms less than you expected and be stuck with it for a lengthy contract. Explain how you would benefit the practice (with proven data) to demonstrate the value of bringing you on as a physician.

Most hiring managers will approach physician salary negotiations in one of two ways:

  • By breaking down how much they are willing to offer you and expecting a counteroffer in return.
  • Point blank asking you how much compensation you are asking for, leaving the ball in your court so that they can counteroffer your asking salary.

When the latter is the case, ask for a little higher salary than your best expectations but be willing to compromise. This will give you some wiggle room for negotiations and still come out with a good physician salary in the end.

You should already have a salary range in mind going into this since you have done your homework and have a good idea of your fair market value.

Be open about your hopes upfront, touching on what you expect in perks, vacation time, and benefits. Your employment agreement might include a restrictive covenant or non-compete clause, which could affect your future career opportunities, so be sure to ask about that.

When an offer is made, don’t take too long to mull it over. Answer all offers promptly, showing respect for your potential employer’s time.

Related: Your Full Guide to On-Call Pay for Physicians

What Questions to Ask

Questions to ask during a physician salary negotiation
It’s ok to ask questions during the negotiation process; in fact, you should be asking a lot of questions. Asking questions shows that you are invested in this and want the best outcome for both parties involved.

Ask questions that show you care about more than just your own interest. Balance your questions to those that involve your interests and questions that concern your ability to deliver above and beyond your employer’s expectations.

You should ask about what a typical day for physicians is like, maybe even requesting to shadow a physician for a day or two to get the feel of the culture and duties involved.


Definitely ask for an explanation of any terms or clauses you don’t understand within the contract. These clauses can mean different things to different organizations, so if the language is vague in the contract, ask for clarification.

If possible, determine your Best Alternative to a Negotiated Agreement (BATNA), and then work from there. As explained before, hiring managers expect a counteroffer to their preliminary offer and have a backup plan intact and you should have one as well.

If you are joining a large healthcare group or hospital, you can try to find out where they are willing to negotiate by asking others who have already negotiated with them. Employees and staff are happy to help if you are genuine and kind in conversing on the topic.

Independent consultants who have helped others negotiate with the same employer have insider knowledge of past negotiations and can find a pattern to follow. These specialists can tell you what the employer was willing to give to other physicians and what you can ask for.

Yet another reason to have an expert team on your side when you are entering physician salary negotiations. Physicians Thrive is the leader in physician contract review and is uniquely positioned to give physicians the best leads to insider knowledge.

Related: How to Ask for a Signing Bonus: A Full Guide for Physicians

Negotiate Beyond the Salary

When you can’t hit your desired base salary mark, you can find ways to improve your employment agreement by negotiating the other terms. Many practices are willing to offer more incentives to get you on board but have a limit to the amount of salary they can offer.

You can ask for a signing bonus and reimbursement for relocation expenses to put more money in your pocket right off the bat and make your transition easier financially.

Increase the value of your contract by negotiating more vacation pay and other incentives like student loan repayment, allowances, and a hefty benefits package.


When you do the math and add up all your extra insurance and non-salary pay, your actual income could be much higher than what you initially thought.

Of course, you can always accept a lower salary if you negotiate a set pay increase each year until you meet your desired salary.

If you negotiate a possibility of partnership in the future, sometimes it’s worth lower pay upfront. A partnership can increase your income exponentially.

Related: Disability Insurance for Physicians

Basic Steps of Negotiation

When you enter into negotiations with a prospective employer, these are the basic steps that you can expect to go through:

  1. You receive the first proposal. The employer will send you an initial offer of employment letter that is not the actual contract but a representation of what they want to offer you as a physician in their practice.
  2. You send a counterproposal to this letter. You review the initial offer letter and try to negotiate the terms that you don’t agree with.
  3. Steps 1 and 2 are repeated until …
  4. You come to a compromise. Through a back and forth of offers, you find a happy medium that brings you both into an agreement.
  5. Or you decline. If they aren’t willing to offer a compensation package that fits your needs and your worth, you can move on to another practice that will.
Prepare for negotiations from the outset. Read Physician Contract Negotiation: Letter of Intent.

When to Accept

It can be hard to know when you should accept an offer that is presented to you. You already know your value and should have a lowest acceptable salary in mind before entering negotiations.

Have they met your base salary expectations? If not, do the benefits and/or future incentives bring extra value to the offer?

If you’ve answered yes to either of these questions, it should be safe to accept the offer if you haven’t seen any red flags in other areas of the negotiations.

When to Move On to Other Offers

When to move on from a physician salary offer
What if you aren’t feeling satisfied with the offers? How do you know if your feelings are warranted or if you are expecting too much?

You should consider walking and respectfully decline an offer if:

  1. You know they are offering way under market value.
  2. You can’t see the potential for increases in the future.
  3. The pay does not match the workload included.

Related: Physician Contracts — The Value of Multiple Offers


It always helps to have experienced contract review specialists by your side during your contract negotiation. Who have successfully helped thousands of doctors secure a competitive salary, and we’ve done just that.

It also helps to come to the table knowing your worth and being willing to move on if it’s not a fit for you. If you’re a good physician, you deserve good pay, and you shouldn’t accept anything less.

Physicians Thrive’s contract review specialists combine legal and financial expertise to ensure that your interests are met during contract negotiations. Contact us now to learn more.

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