Live from the Trail: 3 Things to Look For on Fringe Benefits
It's not the most important factor, maybe not by a long shot, but fringe benefits may have a huge impact on your residency experience and the rest of your career. Fringe benefits are the way residencies pay you without actually paying you. By paying your expenses for you, residencies "pay" you more money by increasing the dollars that stay in your pocket at the end of the month. These benefits are perks in addition to your yearly salary or stipend.
There are many, many different things that may qualify as fringe benefits, but there are a few main ones that you will pretty much see everywhere. Let's examine 3 big ones to look for that will definitely make a difference in your bottom line.
1. Medical Insurance
One of the biggest expenses you will or will not have during residency is insurance. For young, healthy people, the most expensive part of insurance is the monthly premium. Just like you pay a monthly subscription to get access to all the shows on Netflix, insurance companies make you pay a monthly subscription to get access to much lower prices for health care, whether you use it or not. Many residency programs offer a shared cost model, where the university or hospital subsidizes the premium on the insurance and you kick in a portion as well. By in large, these plans are cheaper than the insurance that you can find in exchanges, and they serve as a way for the hospital to say "thank you" for your very cheap labor. The other option that is often seen is the hospital pays for your entire premium each month, and you pay for everything else.
Of the programs that I have interviewed at during this 2017-2018 interview cycle, about half of the programs completely pay the monthly premiums for the insurance, and half do a shared cost model. I am sure there are a few programs that fully cover all costs related to medical care, but I have yet to stumble across one.
My wife owns her own business and thus has to buy her own medical insurance. So as we look at fringe benefits, I am looking for the "Family" price, which is the cost I will pay to have medical insurance that covers me, my wife, and our son. In the shared cost models that I have seen thus far, family-priced premiums are typically anywhere from $150-500 per month. That is a huge range!
When you consider that many programs fully cover the premiums for your entire family, that range of $0/month-$500/month makes a MASSIVE difference! Especially if that family is living off of a resident's salary. If you want to find out what your prospective residency has to offer, just Google "_______ residency GME benefits".
2. Days Off
When looking at the vacation days offered by a program, you'll quickly realize one thing. Most programs offer 15 days of paid vacation per year. What does this mean? Well, the ACGME has rules about time away from residency, so that is where the 15 day number comes from. Also, that 15 days means, usually, 15 week days. The number assumes some amount of weekend days off around that- this is where programs have some flexibility in enforcing your vacation days. If vacation days are important to you, like if you're considering moving across the country from your families, be sure to ask the residents on your interview day/pre-interview dinner if the program works to get you the weekends off around your vacation. An extra day or two on each end to travel could change that vacation from 3 days of family time to 7 days! That can make a big difference.
Another thing to keep in mind is what responsibilities you will have when you come back from vacation. For example, in anesthesia, it is the resident's responsibility to look up his/her patients for the next day to preop them. A lot of times this can be done from home through the medical record, but some programs require their residents to come in to the hospital to preop their patients. Nothing like coming back from a wonderful vacation and driving straight to the hospital to get ready for the next day!
Vacation days aren't the only days off though. Many programs give you time off to travel to a national or regional specialty conference. Some will have "meeting money" set aside to cover your travel expenses. This can be extremely helpful. Not only is the meeting a nice break from clinical duties, but you can also learn more about the conversations happening at the forefront of your specialty.
Other important days off include Personal Days, Sick Days, and Maternity Leave. Personal Days are often used for boards exams (think Step 3 in intern year) or interviews (think fellowship or real job). Sick Days are, well, sick days. Need I say more? These days often have caps on them because, going back earlier, the ACGME has a limit on how many days you can spend away from residency duties and still be qualified to sit for board certification in that specialty. This is where Maternity Leave comes into place. Often a woman that has a baby during residency will get time away from residency to spend with her baby. This can be combined with vacation to make for extra time. Programs are very different in how they interact with Maternity (or Paternity for those that offer it) Leave, so if you are considering having a baby during residency, be sure to ask if any current residents have taken time off and what their experience was. It seems that most places are understanding these days. After a certain point, the time you miss from residency, you will have to make up at the end of residency. Something to keep in mind.
3. Retirement Savings Match
My favorite fringe benefit to look for! Many places tout the ability to start a retirement savings account like a 401K (or 403B) IRA or a Roth IRA. I am still learning about these things, so please bear with me. My current understanding is that a 401K is an account where you can put a percentage of your salary before taxes are taken out of it for it to sit and grow compound interest until you retire. Due to the nature of our need-it-now society that we live in, many people aren't saving for retirement like they should be, and it is going to be a rude wake up call when that day comes and all they have to live on is a couple hundred dollars a month from Social Security. Don't let that be you! PS- a 403B functions similar to a 401K, but don't ask me the difference. I haven't gotten that far yet.
We talked about a 401K, so then what is a Roth IRA? A Roth IRA is also a retirement savings account, but instead you put money in after it is taxed. The downside to a 401K is that although you got to skip taxes when you put the money in, the government then taxes you when you go to withdraw it in retirement. Due to tax bracket issues, this ends up being more expensive for some people than if they would have just put the money in after taxes when they originally made it. That is what a Roth IRA is. After you are taxed on the money just like the rest of your paycheck, you put that money in your IRA and it won't get taxed again, ever!
But it gets better. Since people are SO BAD at saving money these days, many incentive programs have been designed to encourage citizens to save. One of those being a retirement savings match. If you put, say, 3% of your salary into an IRA, your employer will match your contribution up to a predetermined amount, like 3%. The downside to this is that many don't take advantage of this match because they think they need their entire paycheck right now. People don't want to save, so they don't put money in their IRA and they COMPLETELY MISS OUT on this fringe benefit that is literally like leaving money on the table and walking away.
I highly encourage you to check out this post I tagged on my Instagram a few days ago (Yes, Residents Can Save For Retirement) from The White Coat Investor by Dr. Cory Fawcett about saving for retirement in residency. It is shocking the difference it can make.
Lastly, a warning: there is a difference between a salary and a stipend. Residencies use either one. Next blog coming up will examine the similarities and differences.
There you go! I hope you learned something! There are certainly more than 3 fringe benefits, so look into it before you sign on the line! If you already knew all of that, then drop me a comment and make sure I learn something!
Mr. MedSchool Money