By Martin Osinski, MBA, AVA
from Nephrology News & Issues 

Nine years of your life. 

That is the minimum number of years a fellow needs to complete post-college training to become a nephrologist. For many of you, especially those that have done training in other countries, that time frame is substantially higher. But now that it is time to look for a job in what has been a difficult market, what are your options?

1. Stay put.

For some there is the opportunity to stay in fellowship, continue on the same path with a research year or an additional year to do training in transplant, interventional nephrology, or critical care. This alternative can allow you to put off the search for a job for an additional year, and allow you to focus on finding something in a more specific area. But these nephrology subspecialties do not necessarily result in additional financial rewards.

2. Take the academic route.

Those looking to leave training can go in a number of career directions. The most comparable environment to training would be to remain in the area of academics. According to the American Medical Association’s Fellowship Residency Electronic Interactive Data Accumulation  (FREIDA), approximately 20.5% of nephrology fellows coming out of training in 2011 (data from the most recent year available) go into academic positions, working either in research, teaching, or in some academically affiliated clinical practice. This type of position will allow you to maintain a comfort level with being in an academic center and in many institutions provides for greater diversity in your daily routines, includes frequent conferences, and greater intellectual stimulation. You also will have significantly better call schedules than you have now, as this will be your opportunity to look to your future fellows to assist in covering your patients.

The downside to staying in academics tends to be the compensation. Reviewing compensation data from the 2012 Association of American Medical Colleges Faculty Salary Survey, the Renal Physicians Association Benchmark Survey, and the Medical Group Management Association Physician Compensation Survey, for both physicians starting out and established physicians, there are lower compensation numbers in the academic sector than those in the private sector. The ranges vary widely based on the practice setting, number of years in practice, region of the country, and faculty level.

3. Join industry.

Industry would be another option for a career path; approximately 1% of fellows choose to work for pharmaceutical organizations or medical device makers. It provides a broad platform of opportunities for professional development, whether it is in the basic sciences and drug discoveries or through pre-clinical studies. There is also the opportunity to do conventional phase 1-3 trials with regulatory intent, safety review, and reporting. Initially, compensation tends to be slightly higher than that of starting salaries of physicians going into private practice. 

4. Round at a hospital.

The opportunity to work as an employee of the hospital is not one that is usually afforded to young nephrologists, especially not in competitive markets. The reasons are numerous, but the key one is a result of the specialty itself. Nephrologists admit patients that tend to be the sickest of the sick and extremely costly to the hospitals, with higher than average readmission rates (Medicare has implemented new rules that penalize hospitals for readmissions). Hospitals do not benefit by employing nephrologists. The main reason for employing physicians is to increase referrals and fill beds––in most cases, they would be getting those patients regardless of whether they were referred by the nephrologist or not. Very few hospitals have ownership in dialysis units anymore so that revenue stream is not available to them. Hospitals in rural areas tend to employ nephrologists because of the scarcity of the specialty and the potential need.

5. Work for a dialysis provider.

Another option that is becoming more predominant with the changing health care environment is the potential to work for one of the dialysis companies. Some of the dialysis companies are employing physicians through utilization of salaries and income guarantees, mixed with medical directorships. Early indications are that fellows appear to be open to the idea and the security it provides, similar in many ways to the security primary care physician groups have received by selling themselves off to hospitals. The idea of being financially supported by a dialysis provider is appealing and it is expected that (like in primary care) this trend will continue over the coming years.

There are also some opportunities with large managed care organizations such as Kaiser Permanente, Ochsner Health Systems, Mayo Clinic, and others. These situations tend to pay very competitive salaries initially. However, long-term compensation tends to be below that of private practice.

6. Join a private practice.

Approximately 70% of nephrology fellows go into private practice (according to FREIDA), whether it is with a single specialty group or multispecialty group. Of this group, 86% remain in nephrology, which means the balance become hospitalists or go into internal medicine. Over 72% of nephrology practice opportunities are with single specialty groups.

There are advantages and disadvantages to working in either a single specialty group or in a multi-specialty group setting; it is really up to the individual as to which environment they are most comfortable. Most multispecialty groups will provide you with a built-in referral pattern from the physicians in the group. These groups tend to be well managed with a strong administrative function. That is not to infer that there aren’t many single specialty groups that are also well managed, but their limited size means many are not professionally managed.

Both will provide you with a collegial environment and both will give you strength in numbers when negotiating with managed care organizations, accountable care organizations, and hospitals; however, there will probably be more nephrologists in a single specialty group than you would find in a multispecialty group. 

Signs of a viable practice

How much strength the practice has will be dependent on the size of the group and the scarcity of your specialty in the region. You will be able to negotiate with vendors, insurance companies, and the like from a position of strength in many instances. Your call schedule will be dependent on the size of the group as well but in most cases will be equal with the other nephrologists in your practice. In a multispecialty group, you have the potential to be on call with other internal medicine subspecialists if there are not enough nephrologists in the practice. The other nephrology practices in town are not usually excited to be assisting multispecialty groups in their coverage, particularly since your addition to the group represents a referral they are no longer receiving. In a single specialty group, you’ll be required to aggressively build referrals, whereas in a multi-specialty group you will get the vast majority of referrals from within the practice. The group that will be hiring you is not looking at just bringing in a body but rather in bringing in someone who can help grow their practice as well as provide call and additional assistance.

Where do you want to work? 

Location plays a role in all of these options. In the past (according to 2007 FREIDA numbers) over 49% of fellows stayed within 200 miles of where they trained. In 2011, that percentage was under 30%. This is a result of oversaturated markets (54% of nephrologists in this country are located in nine states). The majority of the training programs are in those same states as well but the communities they are in cannot absorb physicians at the same rate as they have in the past. These oversaturated markets and desirable locations play a role in decreasing starting compensation and have forced nephrology fellows into other options, as many now consider a hospitalist role as an alternative if they must stay in a specific area.

Compensation and the future

There are a number of things going on with reimbursement today that will impact compensation and the future environment for nephrologists coming out of training. The sustainable growth rate, which governs Medicare payment for physicians, continues to be a thorn in the nephrologists’ side––and will be until Congress can agree on how to reform it. On 14 occasions, the federal government has delayed implementation of Medicare cuts brought on yearly by the SGR. If Congress doesn’t reach agreement on a new payment methodology by January 1, physicians will be looking at a 24.5% cut in reimbursement in a specialty that is more than 60% dependent upon Medicare. 

Most recently, threats by CMS to cut the composite rate reimbursement to the dialysis providers by 9.4% represents potential loss of medical directorships if providers choose to close dialysis units. These will impact physician group revenues and therefore physician incomes, albeit indirectly. Nephrologists in joint ventures with dialysis providers may also be affected.


As one can see, it is not just a matter for you as a nephrology fellow to identify and determine your best options for a career in nephrology, but it is also important to be aware of these factors that will affect your ability to practice medicine and generate satisfactory incomes. Relating to the governmental issues cited above, it is important that you let your Congressional representatives and the Administration know your concerns. What happens in the coming months could impact you greatly over the coming years and throughout your career. You have worked too hard to get to this point not to speak out and get involved in the process.

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