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Knowing which compensation model best fits your candidates


Which compensation type is best for your organization and your hires? Posted by Megan Trippi
Which compensation type is best for your organization and your hires?

A large consideration for candidates when comparing offers is salary and bonus structure. Compensation packages vary between organizations and contracts, so you want to ensure the organization or practice’s method for incentive pay and overall compensation is included in your offer and is clear and attractive to the candidate.

But if your organization has flexibility with offers, how do you know which compensation model is the best option for your prospective hire?

Straight salary

The straight salary, or 100% salary, model gives a physician a prearranged and fixed income with no variation or bonus incentives.

This can be attractive to both organizations and physicians because it is easy to manage, and physicians know what to expect each paycheck. In some cases, it can decrease productivity over time or lead physicians to bring in fewer patients since there aren’t incentives for doing so.

Salary plus incentive

With salary plus incentive, a physician receives a base salary with additional bonuses based on various factors such as productivity, patient satisfaction and work.

Based on the structure of the overall compensation plan, this can increase physician productivity and satisfaction since they are rewarded for excelling in certain aspects of the practice.

It is beneficial for the bonus structure and incentives to be clear and as objective as possible so the physician can understand how their income is decided.


Pure productivity can sound concerning since a physician is solely compensated based on a percentage of what they bring into the practice.

It does work well and motivates physicians when your organization allows for possible equity or if a physician is interested in starting their own practice. However, it can also create competition between physicians when their only income is based on personal productivity.

Equal shares

This type of compensation is often viewed as straightforward and fair because it takes the practice’s earnings after all expenses have been paid and divides the remaining income equally among its physicians.

This type of compensation can help promote a positive work environment since each physician has equal investment, but it can create division if the physicians have varying experience and skill levels.


Capitation payments are pre-negotiated amounts per patient or unit, and physicians are paid based on the number of patients they see.

This form of compensation can be attractive to physicians if they are joining a well-established practice with a guaranteed patient base. Their income can also be unpredictable when changes occur in the practice.


With different forms of compensation, some may work better than others for your organization or a specific hire. It is beneficial to compare the pros and cons of each structure when you are able, so be aware of your options and choose the best based on your open position and desired candidate.

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