#IMatchedwithCOMLEX

There’s something very sad about the NBOME (the NBME’s osteopathic counterpart) marketing their COMLEX licensing examination with such cringeworthy desperation:

 

Look everyone, some people can match without taking the USMLE too!

In other news, no one is going to use that hashtag.

The COMLEX is an expensive, duplicative exam that has almost no purpose in 2023. Many DO students, especially those attempting to break into more competitive specialties, have been taking the USMLE for years. The NBOME, by stubbornly existing, is effectively taxing DO students.

Parallel residency accreditation is gone. DO students finish school and enter the same residencies as MDs now exclusively supervised by the ACGME and work the exact same jobs as MDs. While the NBOME could reasonably offer a separate small examination to test for osteopathic manipulative medicine (OMM), every year the COMLEX exists is a waste of time and money for everyone involved.

Two years ago, I wrote:

In the 21st century, I’m not convinced physicians are best served by maintaining distinct osteopathic and allopathic pathways at all. A physician is a physician, and the easiest way to get rid of the unfair DO stigma is not to make it a PR issue–but to make it a non-issue. I understand there’s a lot of history here (though much of it not so positive) and plenty of strong feelings. However, even if one buys the argument that the underlying educational philosophy is sufficiently different to warrant different degrees, that’s no justification for perpetuating a separate-but-equal system for licensure given that post-graduate training has already merged and the vast majority of states don’t care.

The eventual outcome is the same. As we all know, it’s the residency training that really makes the doctor.

The future is hard to predict.

When a large language model can pass the USMLE (see the NBME awkwardly trying to deflect), it raises valid questions about how useful not one but a series of three (!) multiple-choice knowledge assessments will be in the future. But, there is no valid argument for why the COMLEX should even exist now let alone in the future. Even if both sets of exams were to be completely pass/fail, that would theoretically remove the extra cost for DOs, but it wouldn’t justify the wasted time and energy need to maintain two analogous physician licensing pathways. Instead, the development costs of both tests could be combined and the price lowered.

If the COMLEX exists 10 years from now, it can only be as an example of status quo bias and the self-serving power of the acronym mafia.

Approaching the Private Equity Job Offer

Here are some thoughts from a seasoned radiologist who was there for the sale and just bailed from an unhealthy private equity-owned radiology practice. They’ve seen many trainees filter through the recruitment process recently as the group aggressively recruits to combat attrition, and they reached out with some brief advice on how to approach the contract/job when evaluating the offer to join a similar practice.

Their perspective is in the blockquotes, and my commentary follows.

As with most of the work on this site discussing private equity, most lessons and pitfalls are not unique to PE. Private equity is a funding model; no organization has a monopoly on unsavory business practices, and every contract requires scrutiny.

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What was sold

You need to know what exactly was sold. The most accurate assessment would be in terms of a percentage and the understanding that X percentage of your future earnings have been sold.

When taking an employee job, your compensation is isolated from this calculus. You’re being paid what you’re being paid. The reason it matters? If the partnership is unstable because compensation is too low for the degree of work relative to the market, then the group is or will likely be unstable. In the short term, that may mean being asked to work harder or the job being less pleasant. In the long term, that may mean being back on the job market.

If you’re taking a “partnership”-styled job, there will eventually be a “profit-sharing” component; now it really matters, because your “bonus” can be $0.

The Big 3: income; time off, and location.

Traditionally you would be given information and have a good reason to believe what you’ve been told. But to a staff-starved organization, you need to be careful.

Even in a stable group, staffing needs may change. In an unstable one, they may change dramatically. You may be asked to cover additional sites or different practice settings. Your income, once a “partner,” may change. When things get very tight, you may not be able to use your vacation.

In some settings, you may be insulated from these shifting demands during the work-up. Once a partner, a bump in compensation will shackle you to dealing with the problems. You may even, rarely, be paid less per work unit than as an associate.

Contracts

PE contracts will often state a salary with specifics like bonus and vacation TBD by the local practice board. When doing so, notice you’ve got nothing in writing beyond your contractual salary. By splitting these variables in a contract there’s little responsibility. You need to get hard numbers in the contract to protect from time off takeaways or continually shockingly low bonuses.

One of the most helpful things may be to ask for a copy of the employment agreement. This will allow you extra time to scrutinize and ask questions before the clock on an offer starts ticking.

Many institutions actually employ a similar tactic where you’ll sign a relatively boilerplate employment agreement and receive a separate, shorter, often more plain-Englishy document that will include the details. That second document–sometimes called a Letter of Understanding (I discussed this more here)–will often include qualifiers like ‘this is what people in your section do currently’ or other weasel words to allow those details to change as needed.

Keep in mind, this isn’t always nefarious. To give you a personal example, I’m a partner in a great group. During my workup, we had to adjust our call coverage hours at the hospital a bit and that changed how my division scheduled our call. These contract structures allow those operational changes to happen without requiring a contract negotiation or a signed addendum for every small detail change.

If you’re a strict employee and expect to be dumped by the group when times get tough, it’s more reasonable to want everything you care about in writing.

Income Verification

Some groups may tout a salary that’s purely wishful thinking. One thing to help assess is to ask for W-2 forms for a partner and/or associate. If there’s a big delta between hope and historical income…caveat emptor.

Note that some PE groups have offered their franchises 0% loans which would increase W-2 numbers. Fortunately, I’ve heard of no groups taking up this deceptive practice to artificially inflate incomes.

That last part is a very sneaky move and bears a bit more discussion. We’ve discussed previously the relative ease with which a corporate entity can temporarily fund supra-market compensation for a position through debt instead of operations (i.e. using borrowed money to take a loss on an employee in order to get the work done).

I’d not heard of this new play before, but this would be a related but different move: by giving the group money to play around with, the PE owner can flush a practice with cash and make them look more successful and better paid than they really are. This would, of course, be a temporary move. Taking a partnership-track job in a practice that took a loan like that would likely result in the future partnership salary being substantially lower than you’d have expected.

RVUs: What are they and why are they important? The relative value unit is the value CMS assigns to different CPT codes to determine payment for a ‘unit’ of work and allows for variable value/compensation for work across the medical spectrum.

Not all things are equal for example. Some radiology examples: CT brain w/o contrast ~0.85; MRI brain w and w/o contrast ~2.29; CXR ~0.22; CT abd-pelvis with contrast ~1.82. One good way to assess compensation is $/rvu.

My personal rough considerations:
<$20: Horrible deal for the radiologist. Someone is getting the technical fee and a large chunk of your professional fee.
$20-29: suboptimal, losing some of the interpretation fee
$30-40: close to full or full professional fee
$40-50: full professional fee
$50+ is an excellent payor base and or some technical fee.

For background, the other components of a CMS payment are the conversion factor (which is what keeps falling every year, currently 33.89 in 2023) and the geographic practice cost index (GPCI, which is an adjustment for locoregional cost factors). For our purposes, we’re ignoring the MIPS quality program. When people discuss RVUs, they are often referring to the wRVU (the work RVU related to physician effort), but there are also peRVU (for practice expenses) and mpRV (for malpractice expense).

Reimbursement for the professional component = [(wRVU*GPCI) + (peRVU*GPCI) + (mpRVU*GPCI) * CF]

For example, the GPCI in Dallas where I live: Work = 1.018; PE = 1.009; MP = .772 (malpractice expense is “low” here thanks to tort reform).

So for a brain MRI with and without contrast, this year Medicare should pay: [(2.29*1.018)+(.85*1.009)+(.13*.772)]*$33.89 = $111.47

Compensation per RVU varies a lot by region and payor contract, so, again, an apples-to-apples comparison is challenging to obtain but important to attempt. A big component of how much you make is how hard you work, but it’s not the only metric.

You also have to distinguish between working as a partner/shareholder and an employee. Historically, a person in the workup is going to be relatively low as part of the so-called sweat equity (i.e. earning their place as a shareholder). So when attempting to figure out a fair partner compensation per RVU, you can see what CMS pays per RVU as a lower-end reference rate. A group’s real-life take-home per-RVU compensation has so many nuances: payor mix, percentage of bad debt, the (increasingly uncommon) share of the technical component, billing expenses, other overhead, etc. No group or individual radiologists is simply earning per hour the total of everything they bill, even before the PE group loses a big fraction to its owner.

When evaluating a job, a per-RVU number like this is a helpful shorthand for comparison, but unless you’re taking a mercenary job and actually being paid per RVU or paid per shift (with a strict productivity requirement), then things can get confusing. Every group has its own compensation plan, and it’s surprisingly difficult to infer fairness from a simple number. It therefore works best when comparing jobs in the same local market or when comparing teleradiology positions.

In the workup, this $/RVU number is going to change over time as your salary typically grows every year, and it will also be different for partners. Some people are faster or slower, and depending on the group’s compensation plan (i.e. unless there is a very strong productivity focus), that means people who are slower/less productive tend to be paid more per RVU.

Different groups also have very different benefits. If your group is flooding your 401k, putting money in your HSA, good healthcare, etc, it’s not always as simple as dividing your take-home pay by your total RVUs or dividing your per-shift compensation by your daily RVU requirement and seeing the number. It’s a useful shorthand, but it’s still only one tool in your arsenal. It is important to keep in mind, however, because it’s easy to hide a lot of suffering in what seems like good compensation and good vacation if you’re reading a ton of RVUs per shift.

Don’t discount high-RVU demands. There are a lot of radiologists working much harder on a daily basis than they ever did taking call as residents. If the comp seems too good to be true, the higher salary may just end up being golden handcuffs.

Attrition

This is a huge sign of group health. There are two types: topside and bottom. Off the top, older/end-of-career isn’t all that concerning. But bottom-side, younger rads with decades of career left, is a tell. At my group, the number of associates at the time of sale was close to 50. Soon there will be single digits remaining. Applicants would be wise to ask for and speak with young radiologists who have left the group to get a 360 perspective on the organization.

This is true. The one caveat I will add is that job mobility is and has been common in radiology for quite a while. So while an exodus is a real problem, a little context will be needed to understand the situation and the stability/trajectory of the group. As I’ve referenced before, a recent 2020 study showed 41% of radiologists had changed jobs in the past four years. Motion is common, so look deeper. A couple of folks leaving may be no big deal just as easily as a harbinger of doom, especially in the current job market.

You should absolutely know specifically when the vesting period ends for the legacy partners. No one has a crystal ball, but it would be prudent to operate under the assumption that when that time comes, there will be a bolus of people leaving/retiring and the group will never be the same.

Internal moonlighting

This a great opportunity normally. But many PE groups are using this as an income growth model. We bring in extra work which you can do and make extra money. Sounds good right? Sure–but it needs to be viewed from the perspective of the primary 8-5 job income adequacy. If young folks are having to sell their time off, take extra jobs or side gigs, then your primary job is inadequate and probably too much of the group was sold off.

Internal moonlighting is great, and it’s very common for folks to supplement their income this way. But it’s different when it’s mandatory, and it’s different when the numbers from internal moonlighting are being used to prop up W2 and make the group look more successful (“we’re making X per year,” when X is a number inflated by lots of work after hours). Moonlighting may be fun and desirable when your daily demands are reasonable; it may be pure burnout on top of barely achievable productivity requirements or lots of call.

In order to do an apples-to-apples comparison, you need to be able to break total compensation down into its components (e.g. salary, call, moonlighting, bonus, 401k profit-sharing) and see how many hours people are putting in.

The Break Up

The break-up process should be scrutinized, specifically tail insurance and non-competes…if you take a job that winds up being $100k’s less than what was advertised and you want to leave, you need to know if you’ll get hit with a hefty tail insurance bill or have to move to avoid a non-compete.

It is still generally common in groups of all stripes for the radiologist leaving to be responsible for tail coverage on a sliding scale over time, paying more if you leave quickly and paying nothing after being there for several years.

Overall, the particularly onerous break-up conditions from PE-owned groups have significantly softened as the job market has become more competitive. Anecdotally, I’m not even sure at this current timepoint if they are “worse” than independent groups. Things I’ve been hearing recently seem comparable from that front. There’s a decent fair range here, and–as with all things–must be judged on a per-group basis and put into the overall context. Ideally, you’d pick a job that you’re less likely to need to bail from in a short timeframe to begin with, but it seems like a good idea when considering a PE-owned practice to be able to pack your bags without feeling locked in.

What I have seen a lot recently is more and more people leaving these groups to stay physically where they are and take on teleradiology work. It seems that this is often a combination of not wanting to move their families and waiting out non-competes. People leaving are in a fortunate situation at least that there is a way to make a living online these days.

Where to work is an important decision, but it is nonetheless a reversible one.

On Building

Highlights from Build: An Unorthodox Guide to Making Things Worth Making by Tony Fadell (who led the teams for the iPod, iPhone, and Nest Learning Thermostat):

On the need to divide decisions into two main camps, data-driven or opinion-driven:

Data-driven: You can acquire, study, and debate facts and numbers that will allow you to be fairly confident in your choice. These decisions are relatively easy to make and defend and most people on the team can agree on the answer.

Opinion-driven: You have to follow your gut and your vision for what you want to do, without the benefit of sufficient data to guide you or back you up. These decisions are always hard and always questioned-after all, everyone has an opinion.

Every decision has elements of data and opinion, but they are ultimately driven by one or the other. Sometimes you have to double down on the data; other times you have to look at all the data and then trust your gut. And trusting your gut is incredibly scary. Many people don’t have either a good gut instinct to follow or the faith in themselves to follow it. It takes time to develop that trust. So they try to turn an opinion-driven business decision into a data-driven one. But data can’t solve an opinion-based problem. So no matter how much data you get, it will always be inconclusive. This leads to analysis paralysis-death by overthinking.

“Data can’t solve an opinion-based problem” is a core problem of the universe.

And the problems are worse when you can find a way to shirk responsibility for making those decisions:

But we fell into the same trap as everyone else. We were wowed by the consultants, excited by the numbers. And we quickly became far too reliant on them: everyone wanted data so they wouldn’t have to make decisions themselves. Instead of moving forward with a design, you’d hear, “Well, let’s just test it.? Nobody wanted to take responsibility for what they were making.

So you’d run the test. And then run it again. On Monday the customer panel would pick option X. On Friday, the same group would go with option Y. Meanwhile, we were paying millions of dollars to consultants who took a month and a half to put their own slant on everything.

The data wasn’t a guide. At best, it was a crutch. At worst, cement shoes. It was analysis paralysis.

“Design by committee” is an adjunct to the crutch of data, where there is no vision for the product and no responsibility for the outcome. I see this in medical schools, residency programs, and medical centers of all varieties. So many meetings to discuss so many dashboards. The analytic tools have become robust, so we are awash in numbers and react by massaging our processes to push various metrics in the right direction, often with no regard to second-order effects.

We so often seem locked into a rearranging deck chair approach to problem-solving instead of designing from first principles to make better products and achieve better outcomes.

On being a doofus:

I remember we had a huge all-hands meeting at Apple once these meetings would only happen two, maybe three times a year. And a guy stands up during the Q&A and starts asking Steve Jobs why he didn’t get a raise or a good review. Steve looks at him in stunned disbelief and says, “I can tell you why. Because you’re asking this question in front of ten thousand people.”

On quitting:

Anyone who’s ever stuck with a job they hated knows the feeling.

Every meeting, every pointless project, every hour stretches on and on. You don’t respect your manager, you roll your eyes at the mission, you stagger out the door at the end of the day exhausted, dragging yourself home to complain to family and friends until they’re as miserable as you are. It is time and energy and health and joy that disappear from your life forever. But hey, that title, that stature, that money it’s worth it all, right?

(He’s asking a rhetorical question.)

The threat of leaving may be enough to push your company to get serious and make whatever change you’re asking for. But it might not. Quitting should never be a negotiating tactic it should be the very last card you play.
So before you quit, you’d better have a story. A good, credible, and factual one. You’ll need to have a rationale for why you left.

And you’ll need one for why you want to join whatever company you’re heading to next. These should be two very different narratives. You’ll need them for the interview, but also for yourself to make sure you’ve really thought things through. And to make sure you’re making the right choice for the next job.

The last part I think is sometimes underappreciated. You don’t just quit from something. Until you retire, you’re also quitting to something.

I wrote a brief article last year on evaluating jobs, where I referenced a 2020 study that showed 41% of radiologists had changed jobs in the past 4 years. I bet it’s even higher now given the current market. Lots of folks are quitting. The question is, are they learning from their experiences?

On the benefits of integrating old and young people:

The best teams are multigenerational Nest employed twenty-year-olds and seventy-year-olds. Experienced people have a wealth of wisdom that they can pass on to the next generation and young people can push back against long-held assumptions. They can often see the opportunity that lies in accomplishing difficult things, while experienced people see only the difficulty.

The generational conflict is real, and it’s often amazing to see in person how easily both groups generously weigh only their own strengths.

CTAs for Vertigo, A Sonnet

I asked Poe, a new AI chatbot, to write me a sonnet about a negative CTA for vertigo:

A CT scan of the head and neck was done,
To search for the cause of vertigo’s plight.
But alas, the results came back as none, No evidence of any wrong or right.

The images showed the structures so clear,
The bones and vessels, all in their place.
No sign of tumors, no sign of fear,
No cause for vertigo’s dizzy chase.

The scan was negative, the results normal,
The cause of vertigo’s still unknown.
But rest assured, there’s no need to mourn,
For further tests will surely be shown.

So let us trust in the power of medicine,
And hope for a cure with each new exam done.

“Further tests will surely be shown” is some (awkwardly phrased and presumably unintentional) incisive commentary on American healthcare.

The Devil’s Tic Tac

From “Nobody Has My Condition But Me” by Beverly Gage in The New Yorker:

Plus, the longer you stay on it the harder it becomes to stop. Prednisone is sometimes referred to as “the Devil’s Tic Tac”: cheap and available and effective, but at potentially scorching long-term costs.

Great term.

I always find it interesting that The New Yorker changes the titles of its stories for the internet so often. In print, this personal essay was titled “One of a Kind.”

Noise in Medicine

Some medical takeaways from Nobel-laureate Daniel Kahneman’s Noise: A Flaw in Human Judgement:

The large role of noise in error contradicts a commonly held belief that random errors do not matter, because they “cancel out.” This belief is wrong. If multiple shots are scattered around the target, it is unhelpful to say that, on average, they hit the bull’s-eye.

I like this line. Some radiologists, for example, over-call questionable findings while others are too cavalier and miss subtle features. They do not cancel out.

In Noise, Kahheman breaks noise down into three big categories: Level Noise, Pattern Noise, and Occasion Noise (each with its own causes and with its own mitigation strategies).

  1. Level noise: The deviation between a single judge from the average judger. For example, some teachers are tough graders.
  2. Pattern noise: The deviation of judges related to a unique or specific situation. For example, a teacher is generally an easy grader but really really likes Oxford commas and tends to grade harsher than average for students who fail to use them.
  3. Occasion noise: Variability related to random irrelevant/undesirable factors (weather, time of day, mood, recent performance of a local sport’s franchise). For example, a teacher grades harsher when finishing up their work from home.

Some doctors prescribe more antibiotics than others do. Level noise is the variability of the average judgments made by different individuals. The ambiguity of judgment scales is one of the sources of level noise. Words such as likely or numbers (e.g., “4 on a scale of 0 to 6”) mean different things to different people.

A massive problem, to be sure, and the reason why radiology trainees hate reading degenerative spine cases (no matter how you grade neural foraminal stenosis, it feels like you’re always “wrong”).

When there is noise, one physician may be clearly right and the other may be clearly wrong (and may suffer from some kind of bias). As might be expected, skill matters a lot. A study of pneumonia diagnoses by radiologists, for instance, found significant noise. Much of it came from differences in skill. More specifically, “variation in skill can explain 44% of the variation in diagnostic decisions,” suggesting that “policies that improve skill perform better than uniform decision guidelines.” Here as elsewhere, training and selection are evidently crucial to the reduction of error, and to the elimination of both noise and bias.

Algorithms are powerful, but for those that assume that checklists and knee-jerk medicine can provide equivalent outcomes, apparently not.

There is variability in radiologists’ judgments with respect to breast cancer from screening mammograms. A large study found that the range of false negatives among different radiologists varied from 0% (the radiologist was correct every time) to greater than 50% (the radiologist incorrectly identified the mammogram as normal more than half of the time). Similarly, false-positive rates ranged from less than 1% to 64% (meaning that nearly two-thirds of the time, the radiologist said the mammogram showed cancer when cancer was not present). False negatives and false positives, from different radiologists, ensure that there is noise.

The massive amount of noise in diagnostic medicine is one of several reasons why “AI” is so enticing. Essentially no one chooses their radiologists, and radiologists are often an out-of-sight/out-of-mind commodity. With our fee-for-service system combined with corporatized profit-seeking and a worsening radiologist shortage, it seems–at least anecdotally–that quality may be falling. These factors all combine to pave the way to make AI tools look even better in comparison.

Later, they go on:

Pattern noise also has a transient component, called occasion noise. We detect this kind of noise if a radiologist assigns different diagnoses to the same image on different days.

This definitely happens. Consistency is hard.

A separate study discusses another human foible, occasional noise related to the time of day:

But another study, not involving diagnosis, identifies a simple source of occasion noise in medicine—a finding worth bearing in mind for both patients and doctors. In short, doctors are significantly more likely to order cancer screenings early in the morning than late in the afternoon. In a large sample, the order rates of breast and colon screening tests were highest at 8 a.m., at 63.7%. They decreased throughout the morning to 48.7% at 11 a.m. They increased to 56.2% at noon—and then decreased to 47.8% at 5 p.m. It follows that patients with appointment times later in the day were less likely to receive guideline-recommended cancer screening.

How can we explain such findings? A possible answer is that physicians almost inevitably run behind in clinic after seeing patients with complex medical problems that require more than the usual twenty-minute slot. We already mentioned the role of stress and fatigue as triggers of occasion noise (see chapter 7), and these elements seem to be at work here. To keep up with their schedules, some doctors skip discussions about preventive health measures. Another illustration of the role of fatigue among clinicians is the lower rate of appropriate handwashing during the end of hospital shifts. (Handwashing turns out to be noisy, too.)

Taking a human factors engineering approach, we know that both patients and doctors will be better off in a system designed with human limitations in mind. For example, not just a deluge of interrupting EHR reminders to ignore, but a system that allows for the right kind of low-friction actionable prompts to be delivered at a useful time during a clinical encounter that is already scheduled in a way to allow for real-time documentation completion without running behind. Wouldn’t that be something?

Concerning metrics:

Focusing on only one of them might produce erroneous evaluations and have harmful incentive effects. The number of patients a doctor sees every day is an important driver of hospital productivity, for example, but you would not want physicians to focus single-mindedly on that indicator, much less to be evaluated and rewarded only on that basis.

See: Goodhart’s Law and patient satisfaction.

Discussion of job interviews and candidate selection has obvious parallels with the residency selection process:

If a candidate seems shy and reserved, for instance, the interviewer may want to ask tough questions about the candidate’s past experiences of working in teams but perhaps will neglect to ask the same questions of someone who seems cheerful and gregarious. The evidence collected about these two candidates will not be the same.

One study that tracked the behavior of interviewers who had formed a positive or negative initial impression from résumés and test scores found that initial impressions have a deep effect on the way the interview proceeds. Interviewers with positive first impressions, for instance, ask fewer questions and tend to “sell” the company to the candidate.

This is an incredibly on-point summary of how most institutions conduct interviews. Those candidates who are good on paper and not painfully awkward during the initial pleasantries basically get a pass. Even when given questions, those answers are often contextualized within the pre-formed opinions. This focus on “selling the program” would even be reasonable if the metrics and data that programs receive were actually helpful at predicting residency success.

Kahneman and his team offer a lot of advice on how to conduct better interviews in the book. Some of it I suspect is too inefficient and awkward for the residency process, but what a lot of programs do (subjectively grade an applicant on a few broad metrics during a committee meeting and then pretend the process is objective) is a bit of a farce.

Summary: highly recommended reading.

 

Incidental Pain and Suffering

From Matthew Davenport’s upcoming article in AJR, “Incidental Findings and Low-Value Care“:

It is increasingly recognized that incidental findings are incompletely understood, expensive, and surprisingly harmful. Rather than a benefit of imaging, they are usually a harm. They are not sought, the odds of them being important is low, and they create tremendous uncertainty and low-value care.

A good primer on an often unintuitive and yet incredibly important problem in medical diagnostics (both for radiologists and clinicians).

Death of the Noncompete?

Last week the FTC announced a proposed rule banning non-compete agreements. You can read the announcement here and the actual rule here. The rule would, if enacted, not just ban all non-competes going forward but nullify previous agreements as well. Non-competes are ubiquitous in medicine and a big factor locking doctors into their jobs, typically by preventing them from practicing in the same geographic region for a period of time after leaving their employer. And, for example, whenever a large organization like an academic medical center or a private equity company buys a practice or otherwise dominates a region, these non-competes form an effective moat against competition by preventing doctors from reorganizing after fleeing.

In some areas/fields, noncompetes are universal and have been functionally unavoidable. Many employers rely on lock-in to mitigate their bad culture and sleazy practices; shifting that power dynamic would I think change things very quickly.

It’s intuitive and straightforward how such a rule would affect employed physicians: you can just quit and hang up your shingle elsewhere. And yes, that means a clinician could join an academic practice for a few years, build up a patient panel, get more comfortable in their skin as an attending physician, and then leave and use that experience as a springboard to a new practice. This is, of course, part of the fear that led to non-competes in the first place. Employers put money into new hires between training, onboarding, early decreased efficiency, marketing, etc. Perhaps in a world without non-competes, employers will be less inclined to invest in their employees; that’s the typical business counterargument. The counter-counterargument also holds water: perhaps, if employers don’t invest in their employees, then their employees will leave. Value shouldn’t be a one-way street.

Too good to be true?

Several immediate reactions have been common. One, that somehow doctors will be exempted because woe is us. Two, that companies will use the magic of lawyers to get around the intent of the law. Three, that practice owners/shareholders (think partners in a large private practice) will be exempted because they are business owners and not employees. Four, that this will be litigated into oblivion.

The announcement had this to say:

Companies use noncompetes for workers across industries and job levels, from hairstylists and warehouse workers to doctors and business executives. In many cases, employers use their outsized bargaining power to coerce workers into signing these contracts. Noncompetes harm competition in U.S. labor markets by blocking workers from pursuing better opportunities and by preventing employers from hiring the best available talent.

So the FTC specifically includes doctors when they think of who this rule will affect.

The language of the rule itself also addresses a few of these concerns:

(1) Non-compete clause means a contractual term between an employer and a worker that prevents the worker from seeking or accepting employment with a person, or operating a business, after the conclusion of the worker’s employment with the employer.

(2) Functional test for whether a contractual term is a non-compete clause. The term non-compete clause includes a contractual term that is a de facto non-compete clause because it has the effect of prohibiting the worker from seeking or accepting employment with a person or operating a business after the conclusion of the worker’s employment with the employer.

So, in theory, clever machinations to functionally bind workers without the use of naughty catchphrases would still be against the law. How easy it would be to prove a functional non-compete in court, how expensive and stressful that process would be for an individual worker, and how aggressive companies will be in toeing the line remains to be seen. How desirable/how effective of a deterrent such schemes would be for employers depends on those answers.

There is an exception for business owners:

The requirements of this Part 910 shall not apply to a non-compete clause that is entered into by a person who is selling a business entity or otherwise disposing of all of the person’s ownership interest in the business entity, or by a person who is selling all or substantially all of a business entity’s operating assets, when the person restricted by the non-compete clause is a substantial owner of, or substantial member or substantial partner in, the business entity at the time the person enters into the non-compete clause.

The FTC defines “Substantial ownersubstantial member, and substantial partner” to “mean an owner, member, or partner holding at least a 25 percent ownership interest in a business entity.”

By that language, the ban would still apply to a physician owner in a practice of 5 or more people. Your average radiologist whose group sold to private equity, could, after the contract period, turn around and start working for other groups locally. They could, even, start a new group.

Well?

How is this likely to play out? I have no idea. In reviewing the media coverage, the overall consensus points towards the final rule being similar to the proposal, it not being stopped by congress (democrat-controlled senate), and then being litigated immediately. How long it takes to work its way through the courts and its eventual fate I don’t know. I’m sure plenty of lawyer and journalist ink will be spilled when the time comes to predict the outcome, but that is far outside my circle of competency.

For Radiology:

In radiology, the ability to do teleradiology work has taken some of the bite out of noncompetes, but this would still be a massive change for physicians in general. In particular, if the carve-out for owners/shareholders were to stay a similar size, the proposed rule provides a window into how a post-PE world might look for practices struggling after the sale.

No one has poured through every contract out there, but one of the common post-sale questions for the past few years has been: how can we get out of this? Common refrains: the things we were promised haven’t been provided, we can’t recruit, our rads are being poached to help elsewhere in the organizational umbrella, we can’t earn enough with the cut to make this sustainable. What recourse do the doctors who sold a practice have if things aren’t working out post-sale?

If this rule were to come to pass, there would be a light at the end of the tunnel. A failing group post-sale could run out the clock and conceivably form a new group to compete with the shell entity they’d leave behind (though presumably companies would still mitigate competition through non-solicitation agreements, for example). RadPartners and friends would still be buying the profits from your work and the goodwill of your relationships for several years, but the lack of a noncompete would make it impossible for them to guarantee their long-term stranglehold if/when their management fails. They’d have real skin in the game.

In practice, that could easily just hasten a lot more hospital-employed radiologists as institutions look to bring in rads and secure imaging services in this uncertain world. There are certainly groups out there that would rather work for the hospital they’ve been staffing for decades than the PE company they sold to. But even that trend could be temporary if a group of employed rads could then leave and form a group.

Boom.

The dynamism that such a rule enables is the real deal. The bargaining table permutations are infinite, and that’s exactly why the FTC wants to ban noncompetes.

WCICON23

Registering through the link here is also one of those effortless ways you can support this site while doing what you were going to do anyway.

I’m very much looking forward to speaking again this coming year at the Physician Wellness & Financial Literacy Conference (aka WCICON23), which will take place March 1-4 at the very nice JW Marriott Desert Ridge in Phoenix. If you have a CME fund to burn, I can’t think of anything else I’d rather spend it on.

 

 

Code CON23BW will net you $200 off an in-person registration through January 25.

Physician Survey Signup Bonuses

Survey company offerings vary a lot by level of training and specialty, but several do offer bonuses to all comers for signing up (or when you attempt a survey or two):

I maintain an up-to-date list of healthcare survey companies here. Some of those links are also referrals that help support this site–so if signing up meets your needs/desires, thank you for supporting my writing.