Educational only. This is not legal, tax, or financial advice. Tax rules, contribution limits, state laws, and regulatory guidance change frequently. Consult your CPA, attorney, or financial advisor before acting on anything below. Last reviewed dates are shown at the bottom of each guide — numbers may be outdated.
The first job offer usually arrives with lots of numbers and very little context. Here is how to read past the headline and evaluate what you are actually being offered.
The four common job shapes
- W-2 employee, no partnership track. You are paid a salary (often plus RVU bonus), benefits provided, no buy-in. Simplest; capped upside.
- W-2 with partnership track. 1-4 years on a defined track, then you buy into the group and start receiving distributions. Highest upside for most.
- Straight 1099 independent contractor. You are your own business. More money pre-tax but more paperwork, no benefits, own malpractice.
- Locum. Short-term 1099 gigs, travel-stipend heavy, used as a bridge.
Headline comp is not the full picture
A good offer evaluation has four layers:
- Base comp (salary, hourly, or guaranteed minimum)
- Variable comp (RVU bonus, collections percentage, production credit) — ask for last year's actuals for your role, not just the theoretical cap
- Benefits value — health insurance, employer 401(k) contributions, PTO, CME allowance, malpractice-tail coverage, relocation
- Optionality value — partnership track, buy-in terms, equity stake, non-compete scope
For a $500k stated offer, layer 2 can swing the take-home by $100k either way, and layer 3 is worth $30-80k/year of pre-tax value. Compare offers on the sum, not the headline.
Partnership track mechanics
Ask these questions in the interview, in writing:
- Length of track? 1-2 years is short and favorable; 4+ years is long and you should understand why.
- What is the historical on-track rate? "Every candidate in the last 5 years made partner" is a green flag. "It depends on fit" is a red flag.
- What is the buy-in? Cash buy-in (you write a check), deferred buy-in (comp reduced for N years), or earn-out (you forgo a fraction of collections)? Deferred is most common.
- What does partnership actually buy? Equal share of profit? Weighted share? Voting rights? Real-estate stake? There can be separate corp + real-estate LLC structures.
- Exit terms? If partners leave, what do they receive? This tells you the actual market value of the share you are buying.
Non-compete clauses
Non-competes vary wildly by state — California voids them almost entirely; most other states enforce reasonable ones. Things to check:
- Geographic scope (e.g., 25 miles from any group facility) — a large multi-site group can effectively lock you out of a whole metro
- Duration (1-2 years is typical; 3+ is aggressive)
- Scope (radiology only, or all medicine?)
- Liquidated damages (a fixed dollar amount to buy your way out, if included, is often more honest than an injunctive remedy)
A practice-management attorney who knows your state should read the contract. Expect $500-1500 for a thorough review; it is worth it.
Tail coverage (for claims-made malpractice)
If your group's malpractice is claims-made (most are), you need "tail coverage" when you leave to protect against claims filed after you are gone. Tail can cost 150-250% of your last annual premium — so $25-60k+. The contract should say who pays. "Group pays tail if you leave in good standing" is standard and fair.
Red flags worth walking away from
- No written disclosure of the partnership buy-in amount or method
- "Owner's perks" (leased cars, club memberships) on the P&L that inflate "group profit" but are not shared with new partners
- 3+ year non-compete with broad geographic scope and no buyout option
- Tail coverage that comes out of your comp, not the group's
- Any language giving the group unilateral right to modify comp mid-year without notice
Questions to ask your advisor (and the group)
- What was the average partner distribution each of the last 3 years (ask for ranges)?
- What percentage of revenue flows to owner salaries vs distributions? (A 100% salary-loaded group has less upside post-partnership)
- What is my expected total comp year 1 vs year 5, assuming partnership?
- If I had to leave in year 2, what would it cost me?
Common mistakes
- Signing the offer letter as-is because "the recruiter was nice"
- Not comparing total comp apples-to-apples across offers (W-2 with full benefits vs 1099 at a flat higher rate)
- Assuming production bonuses will materialize — many do not at the rate quoted
- Skipping the attorney review to save $800 on a contract worth millions over its term
Last reviewed: 2026-04. Contract terms and state laws vary — always have a practice-management attorney review your specific offer.