Combat the turnover trap

Insight Article - AprilĀ 10, 2020

Recruitment & Hiring

Compensation & Benefits

Culture & Engagement

Tony Stajduhar

Medical group and hospital administrators face constant demands to maintain high-quality patient care while also meeting and exceeding revenue targets, and a major player in both pressure points is physician staffing. The nation’s aging population, legislative efforts to increase the number of insured individuals and a physician population in which 30% are at or near retirement age mean administrators must grapple with a growing shortage of doctors and an ultra-competitive recruitment market.1

The ongoing physician shortage has repercussions for the time to fill physician positions, particularly in certain medical specialties. In a 2019 Association for Advancing Physician and Provider Recruitment (AAPPR, formerly ASPR) annual survey, 40% of vacancies had gone unfilled by year-end 2018,2 and a 2018 report from the Society of Hospital Medicine (SoHM) showed 66.4% of hospitalist positions were unfilled at adult-care medicine groups.3

In addition to jeopardizing the quality of patient care, vacancies come at high cost for healthcare organizations. Physicians generate millions annually in indirect and direct revenue for hospitals. According to AAPPR, the median number of days to fill family medicine positions is 4.3 months — and between five to 10 months for a medical or surgical specialist.4

While the impacts from vacancies can be alarming, not all physician openings should have such long vacancies. This is because many vacancies can be predicted, such as physician retirements, involuntary turnover and growth requiring the addition of new physicians. The key is to properly prepare for these situations by implementing and following the right staff planning processes for your practice.

Dodge the retirement disconnect

You can’t control or plan for all turnover, such as unexpected resignations, deaths and illnesses, but retirements shouldn’t have to be a surprise. With one-third of physicians reaching retirement age, it’s never too early to begin retirement and transition discussions, but communication on the topic isn’t always easy.

A 2019 Jackson Physician Search (JPS) survey of 100 hospital administrators and 550-plus physicians and surgeons revealed a disconnect on several topics related to retirement with the potential to impact staffing levels and vacancies.5 Key among these findings were:
  • Most physicians (80%) said it’s their responsibility to broach the retirement subject compared with 37% of administrators, yet fewer physicians (52%) were comfortable with the discussion than administrators (74%).
  • Almost 50% of administrators indicated the ideal notice of retirement from doctors was one to three years, while 40% of physicians felt six months or less was sufficient.
  • Many administrators (40%) named full retirement as a top transition method at their organization, but just 17% of physicians were planning this and 28% of doctors say they would work part or full time somewhere else.
  • Almost 95% of the administrators said they offered no incentives to initiate an earlier approach to retirement, while more than 50% of physicians said that they would be interested in employer-sponsored incentives if it helped with retirement planning, with many indicating interest in a transition to part-time work.
 
These and other findings from the JPS survey indicate an opening for administrators to make improvements that help shorten vacancies, ease the burden of onboarding a new doctor, or address expanding service plans, as suggested here:
  1. Develop non-discriminatory ways to discuss retirement. Human resources and physician leaders should collaboratively create a step-by-step process for when and how to approach the conversation — even as early as the hiring process. Such formal processes make physicians feel less singled out. Also, routine surveys on retirement plans can open lines of communication.
  2. Incentivize earlier notice of retirement. Get a head start on a physician replacement with incentives such as a percentage of pay for earlier notice, health benefits for a specified time period and relief from call duties.
  3. Create flexible offerings such as part-time or non-clinical work. Scheduled conversations help administrators build a retirement road map for doctors interested in locum tenens work or pro re nata (PRN) and telemedicine options that might benefit the practice or healthcare system.

Combat the turnover trap

The costs associated with turnover, involuntary and voluntary, are significant, financially and professionally. If you lose a physician, you lose the money and effort that went into his or her recruiting and onboarding, while at the same time, your medical group or hospital loses revenue from the vacancy. You also risk lower staff morale and efficiency and the ability to meet long-term efficiency and patient care goals, as well as patient migration to another practice and the lack of referrals from that patient.

As noted, vacancies can cost millions in revenue monthly, and the time to fill a position varies with specialty. And, from the moment you know a position is vacant, there could be up to $250,000 invested in just a single physician candidate, including marketing, interview expenses, sign-on bonus and relocation stipend.6 With interview expenses alone ranging upward of $30,000 for each candidate,7 not to mention the addition of sign-on bonuses, the costs of the vacancy add up quickly.

Avoiding physician turnover, either involuntary or otherwise, begins with making the right hire. There will always be unexpected turnover, but much of your recruitment can be anticipated, and the key is to start early, as these tips indicate:
  • Recruit continuously. Don’t treat a physician vacancy as a one-off occurrence. To stay prepared, adopt a continuous recruitment philosophy to keep the candidate pipeline full for all positions. Maintain relationships with candidates so that when you have a vacancy, you don’t start from scratch and can quickly adjust to unforeseen issues during the hiring process. Even if a candidate isn’t a fit now, he or she may be in the future or might refer a qualified colleague.
  • Accelerate filling vacancies. Stay ready to quickly deploy multi-channel marketing using traditional methods and the latest digital and social media so you can attract active lookers and passive candidates. Make sure your compensation and benefits package stays competitive, and respond to candidates from first screening through signed contract.
  • Understand the average time to fill by specialty. Knowing how long it will take to fill your open positions lets you begin recruiting with a start date in mind. It also helps with hiring timelines to support growth and expansion plans. Again, the key is to start early.
  • Benchmark your recruiting effectiveness. Measuring your recruiting and hiring effectiveness is an easy way to uncover process gaps that contribute to the length of physician vacancies. Some of the metrics to consider are: time to fill, number of interviews to hire, percentage of offers accepted, and three- and five-year retention rates. Data can highlight areas of opportunity and allow you to refine your processes through continuous improvement, and a recruitment ROI calculator can help illuminate key metrics.8

Land softly with vigilant preparation

While you can’t anticipate all physician vacancies, you can mitigate the effects from them by fully embracing the right practices. The good news is that in many cases, all it takes is establishing formal lines of communication and creating a mechanism for physicians and other staff to discuss retirements, transitions and other factors that result in vacancies. The key is having an overall plan to maintain the necessary levels of staffing, and much of that is accomplished by starting the recruiting process as early as possible. 

Notes:

  1. Association of American Medical Colleges. “New Findings Confirm Predictions on Physician Shortage,” April 23, 2019. Available from: bit.ly/379PnkE.
  2. Association for Advancing Physician and Provider Recruitment. 2019 AAPPR In-House Physician Recruitment
    Benchmarking Report, Executive Summary, October 2019. Available from: bit.ly/31yPdSV.
  3. Beresford L. “The state of hospital medicine in 2018.” The Hospitalist, Jan. 8, 2019. Available from: bit.ly/2UyB7iY.
  4. Stajduhar T. Physician Recruitment: The Costs to Hire and Return on Investment. Jackson Physician Search, white paper, 2018. Available from: bit.ly/2H3d7fJ.
  5. Ibid.
  6. Stajduhar T. The Realities of Physician Retirement: A Survey of Physicians and Healthcare Administrators, white paper, 2019. Available from: bit.ly/31BzMcD.
  7. Schutte L. “Understanding the Real Costs of Recruiting and Retaining Physicians,” Recruiting Physicians Today, May/June 2012. Available from: bit.ly/2vaWigi.

About the Author

Tony Stajduhar
Tony Stajduhar
President Jackson Physician Search

tstajduhar@jacksonphysiciansearch.com

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