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The past year saw only modest salary gains in the occupational health field, according to an exclusive 2001 Occupational Health Management salary survey. Experts in the field note, however, that this is not unusual for professionals in most fields of employment in the United States.
They add, however, that if you look beyond the numbers, the picture tends to brighten considerably. For example, employers, they say, may not be willing to spring for that big salary increase, but they are becoming more generous with fringe benefits such as pension and profit-sharing plans. Benefits such as these, they note, can translate into significant "value-added" dollars in terms of your actual compensation. And, they add, you can still find that quantum leap in income you’re looking for if you’re willing to think outside of the box and make some tradeoffs in terms of location.
OHM is pleased to provide readers with the results of this 2001 survey. Our exclusive report illustrates some of the key factors that may influence salaries and benefits among occupational health professionals, and allows the reader to "customize" the results in terms of location type, salary range, age, gender and other factors so that they become even more meaningful for the individual reviewing them.
The 2001 OHM salary survey was conducted in the summer. Survey responses were tallied, analyzed, and reported by American Health Consultants, publisher of OHM. We trust you will find the survey of value in helping you gain insight into the leading salary and compensation trends in this dynamic industry.
Responses from occupational health professionals indicate that by and large, only modest salary increases were forthcoming in 2001. A majority of the respondents, 51.35%, reported a salary increase of between 1% and 3%. Another 27.03% reported increases ranging between 4% and 6%. Only 13.5% of the respondents reported increases of 7% or greater. These results came as no surprise to Deborah DiBenedetto, MBA, RN, COHN-S, ABDA, president of the Atlanta-based American Association of Occupational Health Nurses (AAOHN). "Most professional employees are seeing those smaller increases, unless they are technical workers," she notes.
But with a growing nursing shortage, doesn’t employee supply/demand come into play? "A lot of the nursing shortage is not found on the occupational health side, but in acute care," she explains. "There are plenty of us to go around. With the new graduates, however, there are not enough to go to the bedside; we are training more specialists. So, who’s to say what will happen in 10 years?"
To some degree, physicians can control what they earn, notes William B. Patterson, MD, FACOEM, MPH, president of Wilmington, MA-based Occupational Health & Rehabilitation (OH&R). "There’s a tremendous amount of variability in salary based on the desirability of the location," he asserts. "People who are willing to go out into the less urban areas or medium-sized cities can often do a lot better in terms of salary, and they will have a lot lower cost of living as well."
Patterson notes that OH&R operates 46 offices in nine different states, which gives the company a very broad perspective on industry trends. "We talk with a lot people from different parts of the country," he observes. "It helps keep us informed about what’s happened in a number of different markets."
Why would major cities, which tend to have higher costs of living, offer lower salaries than the suburban markets? And how can they get away with it? It’s the old law of supply and demand, Patterson explains. "In locations in or near major metropolitan areas such as Boston, Minneapolis, or Chicago, there are usually more occupational health physicians," Patterson observes. "Therefore, you have a more competitive market and thus you get the lower salary. Whereas, if you go out to a smaller city, especially away from the coasts, you can do better. They have to pay higher salaries to get the kind people they want."
As the salary survey results make clear, occupational health professionals pay attention to a lot more than salary when evaluating a compensation package. When asked to rank medical coverage, a 401K or similar plan and pension plans as in terms of importance, in each case a total of 75.68% of all respondents rated them as "extremely important." Flexible work schedule (54.05%) and dental coverage (48.65%) also ranked high.
The good news is that employers are starting to listen to their employees. "Employers are looking at trying to enhance their benefits packages; they’re encouraging matches’ on 401K’s, and adding profit-sharing plans," says DiBenedetto. "They’re also giving employees a greater opportunity to manage their pension fund or profit sharing plans, allowing them more leeway in determining the investment vehicles in which their money will be invested."
In addition, she says, employers are seeking to enhance their work-life programs, based on what employees’ needs are. "They are making sure that EAPs [Employee Assistance Programs] are available, especially for health care workers," she says. "And now, with the recent events in New York, Washington, DC, and Pennsyvania, many more employers will be looking at them." Employers are also investigating the possible expansion of legal services, eldercare, and childcare, she says.
"Still other employers are seeking to provide additional benefits such as greater flexibility with paid time off arrangements," DiBenedetto adds. "They are moving towards a bank’ of paid time off, so the employee can take off for a variety of reasons. The no. 1 reason for taking time off right now, for example, is personal issues."
Just because these benefits don’t carry a dollar sign next to them, it would be wrong to assume they had no monetary value, DiBenedetto advises. "They absolutely have a dollar value," she asserts. "And the other side of the coin is that it doesn’t add to the financial liability of the company. Every time you raise an employee’s salary you have concommitant additional costs like FICA."
Looking to the overall job market, "the corporate sector is clearly struggling," says Patterson. "In a downturn in the economy, many corporate medical directors are laid off, and there is a lot more outsourcing of corporate medical services to various vendors of occupational medicine. For example, Lucent, Raytheon, and Kodak have substantially shrunk their corporate medical departments from last year."
Ironically, says Patterson, he has seen a number of hospital programs that have been paying their medical directors salary rates that are above the national average, "and typically those hospital programs are not well run from a business or financial point of view; they are not really tracking what appropriate doctors’ salaries are," he notes. "They are overpaying by an amount ranging anywhere from 10% to 20%," Patterson continues. "Unfortunately, what is now happening is that when the hospital finally gets serious, the corporate medical directors may find themselves being asked to take a pay cut."
Meanwhile, Patterson notes, there continues to be steady consolidation among the leading occupational medicine vendors. "The top three are Concentra, USHealthWorks and us, in that order — and they clearly are all continuing to expand," he says. "As this trend continues, more and more of the providers will be working for large corporations. And in large corporations like ours every provider will be on some form of incentive-based compensation."
The actual formula used varies from company to company, he explains. "In some organizations, it is based on the productivity of the provider, while in ours, it is based on the profitability of the office as a whole," he says. "But there will continue to be a move toward compensation which is in part incentive-based."