Managing Physician Recruit Turnover Risk

Physician Turnover RiskBy: Allison McCarthy, MBA

The AMGA/Cejka study has been consistently tracking annual physician turnover at about 6-7%.  That translates into losing about 1-2 physicians for every 20 recruited into your medical staff.

There is real cost associated with turnover.  It’s possible to demonstrate the impact with  “hard” numbers.  For example:

  • Opportunity cost – what is the unrealized financial contribution for a physician NOT in a specific position i.e. the revenue or contribution margin that would be generated by the physician less the cost of employing or supporting him/her.
  • Replacement cost – what would be the costs to recruit another physician into that position including sourcing, site visits, signing bonus, relocation, etc….
    • Practice productivity – add to the above the amount that the organization has to subsidize the startup of each new physician.  The difference between what the physician costs in salary/benefits, practice expenses, etc… versus what they bring in for revenue. Then you have the total replacement cost.
  • Patient attrition – when a physician leaves a practice, the practice can lose those patients to another care center – maybe even in a competing system.  How many patients does that represent?  And what is the downstream revenue associated with those patients?

Managing turnover is a real dollars and cents effort.  By recognizing the specific experiences (or lack thereof) that makes a meaningful difference in the new recruit’s perception of the organization, we can more aggressively manage those situations and help the organization save real money.

Through our “New Physician Assessment” we can uncover those areas where the organization is as risk.  Just email me for more information at

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