I often quote or paraphrase Henry Ford’s saying: “Whether you believe you can do a thing or not, you are right.”
And as my Dad says, “If you don’t ask, you don’t get.”
Today’s guest author believes he can and he’s not afraid to ask. Five years into his career, he’s worked his way up to a million-dollar-plus annual income. Today, he shares his origin story and how he arrived at this lofty annual income.
He has shared his identity with me, but prefers to remain anonymous on this public post.
The 7-Figure Urologist: Origin Story
My story begins in the rust belt during the blizzard of 1978. I was the fifth child born to second generation American parents in their late forties. I ended up losing my father to suicide when I was 11 years old and my mother to health issues when I was 13.
My father worked on the railroad and my mother never worked outside the home. I was 13-year old orphan plunged into the world with an inheritance of $8,000 dollars. My older sister became my guardian but needless to say I was as much of an adult by 13 as I am today at 41.
While not having parental guidance, I was blessed with intellect and a ferocious work ethic. I did carry financial scars with me after this ordeal as my mother and I lost all income when my father passed. We eventually were able to receive a modest railroad pension which is roughly equivalent to social security but times remained tough before and after my mother passed.
An Entrepreneurial Mindset
Fast forward: I ended up attending a prestigious undergrad institution and then on to medical school. I always thought that Doctors were financial titans and a substantial portion of their financial prowess came from owning their practices.
I went into medicine expecting to be a small business owner after training. I did well during medical school and choose Urology as a specialty. I chose Urology not only for the work but also found the business end of the specialty to be appealing.
It was during my intern year when a rural hospital about an hour from my training expressed interest in having me practice there after training. I had rotated there during my medical school OB/GYN clerkship.
I quickly dismissed this idea but after considering my family, which started during my 4th year of med school with my first child, I began to think that this could be the place for me. After all, this position was about 15 miles from my mother-in-law, which is where we all end up anyway.
I had an exceptional time negotiating my contract. I used websites, blog sites, and personal conversations to develop my package. It was very early in my training which allowed me a lot of wiggle room. I signed a deal to practice there after residency.
I was able to negotiate a $50,000 signing bonus, $25,000 per year stipend during residency, and $125,000 of student loan repayment. My deal was to start a solo private practice where I would be guaranteed the 50th percentile salary and full practice support.
This period would last for 2 years and then I would need to stay for an additional 4 years, which ends in August of 2019. After negotiating this deal, I became known as an “expert negotiator” and have helped several colleagues in several areas of medicine navigate the contracting process.
Starting Clinical Practice
I started into private solo practice right out of residency. I hired an office manager and full complement of staff including an advanced practice provider (APP). I was able to build out my office during residency have the hospital rent it from me prior to graduation for the retiring urologist to practice.
Private practice is tough; private solo practice right out of residency is as tough as it gets. At the end of my two years of practice and income guarantee, I had to decide whether to remain in private practice or become employed.
I used several accountants, other physicians, and hospital administrators in my analysis of the two roads. After two years of private practice, I sold my practice and became hospital employed.
I had some colleagues who looked up to me in the private practice world very disappointed in my “selling out” and going against everything that I preached. These same folks were also very anxious to hear the details and learn more of how I came to this conclusion.
For my employment recipe, I needed to understand RVU’s that were, up until now, a mythical beast to me. My mantra was always “how do you spend an RVU?” and never really took the time to understand RVU’s.
It was during my second year of my income guarantee that I had heard some of the dollar per RVU numbers that my colleagues were getting. I then converted my practice into RVU counts. I did the math and was blown away.
I went to the negotiating table, where I am very comfortable, and I was able to negotiate a better rate than my colleagues and a few other perks. I was able to have the hospital lease my office for me to work in, effectively becoming the landlord netting about $30,000 per year.
I was able to maintain two additional Urology positions outside of the health system. I was able to keep my surgery center and lithotripsy ownership. I was also able to create a unique financial relationship with my APP that has recently been adopted by the entire 45+ hospital system.
Multiple Income Streams
Current situation: I have been hospital employed for three years now and am happy. I am able to make about $700,000 in my main employed position. I make about $150,000 per year working in a second hospital system on Fridays; I average about 2-3 per month and cover consults.
I also take one weekend of call per month at the hospital where I live and make an additional $50,000 per year doing that.
My ancillary income reaches about $250,000 per year between building, surgery center, and lithotripsy. My wife is a Dentist and makes about $250,000 per year working three days per week.
We make between $1.3 to $1.5 million per year in household income. This high stable income and my Midwestern residence have afforded me the ability to enter the side hustle game and satisfy my want of business ownership.
I literally closed my first non-medical side hustle on the same day that I became employed.
*not the same physician, by the way
Physician on FIRE, thank you for sharing a part of my journey. I will be sharing further posts on medical side hustles, non-medical side hustles, personal finance, tax strategy, and potentially how to maximize an APP in practice.
What else would you like to hear about from the 7-figure urologist? Have you negotiated well for yourself? Let us know in the comment box below!
How can I get compensation metrics like:
RVU centiles
Salary centiles for academic and private practice
Centiles for $/RVU payments?
As a current 2nd year urology resident, I am impressed by what you were able to accomplish for yourself before completing residency! I feel that the taboo nature of salary and income goals in medicine, especially at an academic center, make it difficult to find mentors who are willing to guide decision making at my current level and beyond. Would love to get in touch to speak more about what I can do now to position myself favorably in the future.
Likewise, you wanna split ownership on a lithotripsy machine 🙂
I produced nearly 46,000 tRVUs in 2018 as a solo practitioner. Understanding the rules of the game is critical. Knowing what is efficient when it comes to revenue generation is also important. What Tom Z did is super smart if your goal is FIRE.
Please be aware that the OR is nothing but an expensive hobby for urologists.
I am like Tom Z: multiple revenue streams and no “big whacks.” Unlike Tom Z, I don’t leverage APPs nor do I run to multiple offices.
There are many moving parts to contract negotiations. Mentors and good consultants are imperative.
Best of luck to everyone.
– The multiple 7-figure urologist
P.S. Tom Z should contact me via DM. I may be able to further assist in his ventures.
I would be happy to talk further. Always someone doing better out there and i have learned alot from folks like you in my lifetime. Let me know when you want to chat.
Tom Z
46k… for a median of roughly $57 RVU? In what region of the US and what is your call schedule like.
In referencing to ALD, I’m also a 2nd year uro resident. There are no Campbells for private practice or for business ventures. Any thoughts on how you guys were able to network with mentors and consultants?
Wow! I’m also a practicing urologist 95th percentile of RVU production (12K RVU per yer). As a sole urologist, how do you have the time to also have a second practice on Fridays at another hospital?
Also, doesn’t “fair market value” limit the amount a hospital pays you for your service?
Further, if you have partial ownership of an ambulatory surgery center, do the procedures you perform there count as production for your hospital employment?
As a sole urologist in your community, what types of procedures do you perform? Nephrectomy, robotic prostatectomy, etc? Or mainly stones/outpatient procedures?
My situation is as follows:
Hospital employment: 335K/year at 40% percentile RVU production (6000 RVU per year);
Lithotripsy owner: 85k/year
Someone please tell me if I’m getting screwed!
I am sorry it has taken me this long to review your post. We need to talk. You are doing great on the litho. My procedures in the surgery center count as hospital employed pay. My dividends from the center do not count as hospital income. I gave up the big cases right out of residency. I label my practice as “high volume, low acuity”. I am getting alot of payment from what my APP provides, approximately 120k/ year. I personally do about 10000 RVU at my main gig. I am paid hourly and per diem at my outside gig so don’t have actual numbers for RVU. The second gig is possible because of the NP. I am currently interviewing to add a second APP and increase access as i nurtured the referral lines long enough for this to happen. Please tell me you are not making 335000 for 12000 RVU per year? My contract with out ancillary pay would pay out 714k per year for that production, new contract would pay 750k for that.
Most large systems will limit you out on the 75th percentile of dollars/RVU. Currently for GU that is 71.90. My current rate is 59.5 per RVU. I am currently negotiating for 62.5 per RVU. Midwest median is 61/RVU. When i add in what i get from the APP i am capped at the 75th percentile or 71.90. I am currently negotiating a work around for this. Let’s talk
Tom Z –
Hey, thanks for the reply. I didn’t proofread my post very well – I’m NOT anywhere near the 95%ile in my practice. According to the hospital (I’m employed), my production is between 5500-6500 RVUs per year. I’ve been fairly skeptical of these numbers however, because I feel much busier than that – I typically perform 9-12 procedures a week in the OR – mainly for stones, but penile prosthesis, some oncology, in addition to office procedures. I routinely admit patients on call and typically see around 25 patients a day in clinic.
Compared to my older, non-employed partners, I feel much busier; I do not know their incomes however. Perhaps I’m not as efficient with my time?
I’d love to hear a typical week in your practice – call, admissions, etc.
You’ve got a great thing going! Keep it up!
My schedule is a little different because of the APP. We typically see 40 pts per day in the clinic. The schedule is combined so hard to tell how many i see vs. APP. When she is gone i schedule 30 pts. I typically do 8-12 procedures on tuesday. I will then operate every other thrusday morning at one facility and every other friday morning at another facility. Having multiple locations makes sure that i am saturated at each office. I never admit pts, have hospitalist admit. I am the only GU at my facility. I am employed but i spent the time and money to make sure my front desk is a certified urology coder. She keeps my billing squared up. She also tracks my RVU’s before i get the number from the hospital. I also bonus the staff out of my own pocket quarterly for RVU milestones. This drives my desk to get pts in quickly. Alot of RVU production is driven by new pt flow. This will drive good RVU procedures in our type of practice. You could focus on some new business and offer them same day/ next day appointments. You could also call ER’s where you get good patients and talk to the director and offer fast appointments as well. You can also analyze your E/M. Are you billing 4’s and 5’s when appropriate. I recently had some colleagues tell me where i was under-billing pre-surgical patients. I don’t know what EMR you are using but make sure you incorporate dragon or a scribe. If the pt volume is there then you need to wok on efficiency. Glad to talk sometime about this.
How did your employment contract address your ability to practice outside the system? Many employment agreements I have seen prohibit moonlighting.
I used carveouts in my agreement. I focused on a couple treatment lines that my hospital did not have to rationalize the need. My weekend hospital has radiation oncology where my full time gig does not. I used the need to collaborate for brachytherapy cases as the carve out for this facility. My current employer is catholic and my hospital sits on catholic ground so no chance for vasectomies. I do all my vasectomies at the outside facility. I just told my CEO that i need this in order to take care of our community effectively and not let any business leave i need to have access to this facility. It also increases my access and several cases from both my outside facilities are done in my main facility, so win-win scenario. I worked in the carveouts but also gave good rationale for needing them. I never rec’d a bit of push back on this. So my advice is to ask for a carveout but think outside the box on rationale. Remember to appeal to the hospital from a business standpoint if possible.
Love the story! I’m a new FP grad in a city that’s saturated. My contract is $225K guaranteed for two years with a 20K sign on bonus for 36 patient contact hours per week, after which I’ll be production. I started moonlighting in rural sites as a resident. I also just started moonlighting at the VA for a total of 180-220K in side gig income per year. My clinic shares space with an urgent care. In clinic I try to focus on in-office procedures as well as moving complicated urgent care patients to my schedule that are more than they’re comfortable with, but not quite sick enough for the ER.
I’m branching into aesthetic procedures, which is new for my clinic. I’d love to hear more about negotiating and how to best utilize APPs. Thanks!
I think you can learn a lot from this site and how to set up finances on the side hustle. When i became employed i left my private practice open. This is very advantagous for tax planning. Another saying of mine is “it is not how much money you earn but how much you keep”. I have maintained my profit sharing and my cash balance plan. This will usually allow me to put another 6 figures away per year pre-tax. This also gives me a way to write off other business expenses that could not be written off in a employed only scenario. I have rec’d a tax refund three years running. This is a running joke between me and my accountant.
We are going to do an article on APP scenarios.
As you know, receiving a refund is not efficient tax planning. Consider ways to mitigate that by working with your CPA.
Figure out ways to put away > MULTIPLE 6-figures pre-tax into retirement / tax-advantaged situations.
Keep up the hustle. It’s a fun game to play.
I would love to hear more about the unique financial arrangement with APPs.
I think we are going to do an entire piece on the APP model. There are several ways to approach this. The worst way is to just let a hospital hire an APP that you have to teach your craft to and then have them working alongside you in competition. Either refuse to train this person or make it somewhat financially successful to you. If you are in a scenario where this presents itself i would be happy to speak with you about it.
Excellent job! You should definitely be proud of taking the bull by the horns and cultivating a practice setting that works for you.
I realize this is the “origin story”, so just more of an overview. Maybe a follow up article or two on actionable items? Setting up a successful APP? Keys to negotiation? Anything besides go back and do urology (or maybe 3 day a week dentistry)…
Thanks for the compliments, We are going to do few more articles. That being said my wife works mon, tues, and thurs. Not a bad schedule. Something to think about as your are guiding children into professions. I have two daughters that are very interesting in dentistry, not so much Urology. We are working on the next articles.
Interesting perspective on how leaving private practice to work for the hospital was actually more lucrative and I would imagine far less burdensome on the business side. I have worked in startups for quite some time and done pretty well, however, I know a couple of long term corporate friends who get very lucrative benefits in addition to nice big salaries and have carved out low stress roles over time. I think the lesson is that it can seem like the shiny prize to want to start your own practice and eventually get a few younger physicians working under you so you have some great financial stream or starting the next big startup and exit big. However, perhaps sometimes with work as with investing, the less flashy path carefully taken can yield great steady returns that get you to your goal better than the alternative
Thanks, interesting to see someone on here not in the medicine game. As docs we are all envious of the business world, at least i am. I have a buddy who is 38 yo and just cashed out of the injection molding industry for 40 million after tax cash. He is loving life right now. This guy never went to college and finished high school with less than a 2.0 GPA. He always jokes about how many MBA’s he had working for him.
That being said, i think one of the most important things for young docs to understand is to be pliable in the way you are paid. When i went from being private to employed, this happened from Friday to the following Monday, there was no difference to my patients. My entire staff was hired and the location only rec’d a few more signs in the waiting area and all the patients had to fill out new forms. This transition was huge on paper but not much in actuality and virtually nil to patients. I am currently in negotiations again on my contract and am considering a jump back into a somewhat private world with a professional services agreement.
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My mind is blown. I read a lot of articles on PoF, but this was my favorite. It motivates me to work smarter because you are absolutely crushing the game. Well done.
Sorry about the late response, thanks so much for the compliments above. We are working on some further installments.
The RVU system is VERY friendly to urologists. Unfortunately there is significant gender discrepancy when it comes to procedures on male vs female patients. For example, biopsy of a scrotum is worth 5.72 wRVUs whereas a vulvar biopsy is worth 1.1 wRVU. Biopsy of the prostate is 4.61 wRVUs, biopsy of the endometrium is 1.53 wRVU. And don’t get me started on how little CMS values my time when it comes to managing labor patients.
Congratulations on your success, however it is unlikely to be translated to other specialties nearly as well.
This is a really important point.
You are right about the RVU system being different for different fields. I think some of this is going to stem back to medical school and specialty choice. I was just listening to one of my GU colleagues, who also approaches 7 figures of income, the other night complaining about how much his buddy makes in neurosurgery. I think some of this stems back to specialty choice and how very little we know as medical students about the finances of the fields we go into. I did study a little bit about salary and average hours worked but i had no idea an RVU existed until late into my residency. I think this is a big problem with medical education in general. That being said most fields are still a volume play. If your RVUs are smaller for procedures then you need to figure out either how to perform these procedures more quickly or more importantly how to schedule these procedures effectively. I perform my prostate biopsies during my clinic. They are scheduled for 15 minutes and take me about 6 minutes to perform in the room. I learned alot about scheduling from my wife’s dental practice and and studying successful dentists. I have a friend who is a dentist. He makes about 800k per year, works full days mon-wed, no lunch thursday done at 2pm, never works fridays. He schedules all of his chairs in 6 minute blocks. He knows how much time his assistants need to prep the patient and how much time he needs to do his work. Instead of schedule joe toothache for 45 minutes he schedules the chair that he is sat in for 18 minutes of his time then on to the next chair.
I know practicing medicine i tough but when it comes to the RVU system, we cannot change the game but only learn how to play it better.
Tom Z,
It takes me 4 minutes for a 12-core biopsy including complete imaging annotation and documentation for the TRUS portion. We are kindred spirits.
I am also married to a dentist. I also attend dental seminars to steal best practices from them. Unfortunately, they are following medicine in participating in insurance; they are spiraling down.
I agree, my wife’s income has been stagnant for the last couple years. we have four children though and this is her main focus. Thanks for the reply
Amazing story. Thanks for sharing. Great job working your way up to this level.
I’m in awe of what you have accomplished!
Thanks for this. I have always had the attitude in life that i needed to “play cards with the hand i have been dealt”. I applaud everyone on this site. I have always felt that being a Doctor and talking about income have been very taboo. Especially in the academic setting.
Maybe you could give a presentation on contract negotiation at the WCI conference next year.
I have never attended WCI. I do have a handful of colleagues in multiple specialties who i have successfully help negotiate contracts. Thanks for the compliment.
That is remarkable of being so financially savvy with the negotiation skills you possess while still in residency. Most docs never get to that level and know their true worth even decades out of practice.
I certainly did not bring much negotiation skills to the table and just went with what was offered. This is part of the lack of financial training that docs are subjected to throughout their education. Basic finance and negotiation should be a mandatory course in med school or residency.
Congratulations on creating a very impressive business resume early on. The fact that you negotiated the hospital to rent out your building for you to practice is such a win-win situation for you.
I’ve always felt handicapped in my negotiations or lack thereof when it came to contracts. Being in radiology as well and come out at one of the most difficult times (2012-2013) when the market was very depressed. Friends who tried to negotiate contract terms, let alone salary, where just having there offers pulled. It was very much a take or leave it market for newly minted rads.
I’ve always felt that the one part on the keys to negotiation is being able to walk away if needed. Feel like this example would be useful to those in surgical specialities. Specialties who bring patients to a facility.
In radiology, we have become commoditized and we are easily replaceable with a click of a button.
Sorry about the late reply, I think it is very important for residents to go where there is a need instead of where they want to live. I was fortunate to be in a position of need that was close to where i am from. As a specialist if you push your way into a market then you can not expect to make big salaries. I agree on being able to “walk away” from a negotiation but would lump that under the category of LEVERAGE. This could include many things but i think most important is need. It goes back to one of my favorite credos in negotiation “negotiation without leverage is begging”. That being said the portability of radiology is a whole different animal compared to a surgical sub-specialty. What i would say is remain pliable and possibly supplement your income with side gigs in remote reads. I am currently looking into tele-medicine to possibly increase my side hustle income but also to understand a competitor that may be in my market and how it will infiltrate. I have a good friend who owns about 60 grocery stores. He tells me that Amazon grocery service is like having a ten store grocery chain in a market that you can’t see. I feel this applies to radiology for sure but could also apply to telemedicine in general.
Need vs want in terms of location is a very difficult game to play when you have a significant other who has their own ideas of what they would like. Lucky if location/job match up perfectly.
Location doesn’t apply evenly to all specialties. I think Radiology and Pathology suffer from this. Maybe ER? Stroke call is being offloaded to telemedicine these days as well, even in markets with access to a rich supply of local talent. In some ways its like competing with Amazon even though they don’t add much value other than mouth to feed.
Already doing side work myself, but not much leverage with cost. It has become a race to the bottom in radiology, somewhat hastened by corporate entities / Private equity looking to capture market share at any cost. Another big downside is time. Time spent away from doing other things (family, gym, etc).
Thank you for the response.
The spouse factor is real when it comes to job choice. I think if your spouse is guiding where you are practicing then you can’t focus on maxing income. The ability to go where there is a need a paramount for maxing income. That being said i feel that the fields you mentioned do make going where there is need may be difficult situation. There is also that “if you can’t beat ’em, join ’em” mentality. If private equity is buying up these practices make sure that you positioned in one the practices to get a payout. I had a group of Urologist that just got bought out an hour south of me by private equity. Each guy got a check for 900k and a little piece of the pie going forward but had to take about 100k paycut annually going forward. As far as time management goes, i fit one job into four days per week giving me the ability to maintain a side gig one day per week. My third job is just for one weekend per month. I keep acuity low and volume high. keep struggling and be pliable.
Agree with Crispy Doc. Tell me more about these masterful negotiation skills.
Incredible work, and an impressive story.
TPP
I’d love to learn what books or resources he used to study negotiation tactics.
Very impressive story, although how you resisted titling it something like, “Goodness Gracious Great Balls Of FIRE” speaks to your better angels, PoF.
Fondly,
CD
Sorry about the late response. I learned most of my strategy from talking with people. I never could finish most of the books i have tried to read on negotiation. I tried ” 7 habits of successful people” but never got through it. I took opinions from many people from other docs to recruiters to personal finance folks on how to structure a deal. I keep learning as i am in the middle of structuring a new deal for myself for the next 5 years.