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SCPMG vs TPMG

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  • SCPMG vs TPMG

    Hi, new graduate who has a job offer from both TPMG (associate physician shareholder track in 3 years)and SCPMG (full time associate physician partnership track in 3 years). I'm trying to look at primarily their benefits package, and sorting the difference. It seems that there are some things that need to be read between the lines, and wanted to make sure I was interpreting them correctly. Overall it feels that TPMG has the better package, but wanted to make sure.

    Salary: TPMG
    TPMG-360k on 40 hours, expected to work 40-50 hours week, so possibly up to 450k but pension calculated on 360k
    SCPMG- 310k for 40 hours, expected to work 60 hours week, so likely 465k, but pension calculated on 310k

    Bonus: TPMG
    TPMG-15k TPIP bonus, + 10% from 290k to salary from Plan 2 Sept payment, so extra 7k for me
    SCPMG-15k bonus

    Pension: TPMG? Questions to be had
    TPMG-5 year vesting, IRS-qualified fund meaning your pension payouts max at wage salary or 290k. They will lump sum you the difference at 65 years old and give you 8% extra for taxes. This would be great for later year Roth conversions. IRS qualified and good funding status makes it safer and less linked to Kaiser solvency?
    SCPMG-10 year vesting, non-qualified fund. Can pay you out your whole salary over 290 without lump sum. However non-qualified status makes it more risky?
    -Pension calculations seem to be similar - 2%HAC for 20 years, then 1% every year after
    -Do SCPMG docs get some huge raise in later years to make up for poor salary? because the pay difference between TPMG/SCPMG is somewhat substantial in terms of pension calculations above. I heard that SCPMG pension payouts are higher, but I"m guessing that could be due to the fact that they dont get the IRS wage limit and lump sum thing that TPMG has to deal with? In some ways I'd rather get a lump sum, and then a 5-year annuity withdrawal so the money would be both mine and my descendents, rather than just dying with me.

    401(k) options/Plan 2-3/Keogh: TPMG
    -SCPMG has Scwab vs TPMG with Fidelity - seems similar? likely good options.
    -Both of roth 401(k) and traditional 401(k) options for up to 19,500
    -TPMG contributes 5% up to SSWB + 10% up to IRS limit 290, so roughly 22k match
    -SCPMG has no 401(k) match??
    -TPMG has aftertax contributions up to 58k total, and can in-plan Roth Conversion at no extra cost/tax complciations
    -SCPMG has Keogh and/or aftertax. Keogh is good for high-earning tax deferral. However doing a combination of Keogh+aftertax makes after-tax roth conversions more taxable?
    -Overall TPMG seems to be the winner as you only need to contribute 36k to max out your 58k limit, while SCPMG makes you front the whole thing on a lower W2.

    Healthcare: TPMG
    TPMG-platinum package where everything is free except a 5$ copay for meds
    SCPMG-I am only offered a high-deductible plan with 20% coinsurance. SCPMG pays 1k into an HSA. I guess I could max a family HSA for 7,300, but it seems like the platinum healthcare package is better. Do partners get this in SCPMG?

    Time Off: SCPMG?
    TPMG-3 weeks VAC, 1 week CME, 4 weeks sick leave - which grows to ?6 weeks VAC, 1 week CME, and 6 months sick leave at shareholder?
    SCPMG-3 weeks VAC, 1 week CME, 3 weeks sick leave - which grows to 33 days VAC, 1 week CME, and 3 months sick leave at 10 years?
    SCPMG also has a sabbatical?
    -My SCPMG specialty/department has no "half day off admin time" I've heard of in other WCI threads

    Work Life: Both seem to be efficient and work hard. Younger guys seem to take more call.

    Retire Early: ?SCPMG unsure.
    -SCPMG - early separation at 58, but requires board approval. How common is this actually? Requiring approval makes this so non-guaranteed. I hear you can come back "Emeritus" status and work for SCPMG again doing chill part-time work while collecting pension
    -TPMG - early retirement at 60 with full benefits. You can't work for TPMG under any capacity again due to IRS pension rules.

    Company shareholder/stock/partnership-TPMG? Expensive buy-in but a good private equity investment?
    -TPMG gets a W2 for life
    -SCPMG gets a K1
    -TPMG buy-in is 140-150k this year, tends to go up 10%/year
    -SCPMG buy-in is 2,500? Not sure about other benefits of partnership
    -TPMG has a dividend payment in March ~15k
    -SCPMG also has dividend/bonus for partners - unclear how much

    Deferred Compensation Plan:
    -I did not get much information about this in either benefits brochure. From posts, looks like TPMG is a non-qualified plan which lends money to the company. Its locked into the company for at least 5 years, and then you can push back your repayment date yearly. It sounds like you could do some type of shenanigans where you defer comp for a few years (or more, or do a small amount like 10k and defer forever), then retire full-early and get the comp to still get full salary til 65, then defer pension and let the deffered comp keep piling up while converting traditional 401 to roth, and then get a increased pension payout at 71, which you could also roll out into a roth over 5 years? Does anyone have any explanation if this is correct for TPMG, and how it works in SCPMG?

    In my view, LTDI, Life insurance, etc are all similar in both groups, and its better to get your own. Group insurances kinda suck.


    So overall, it seems to me that TPMG total comp is much better than SCPMG, unless SCPMG salaries grow alot higher after 10 years in the company ("eat your young" philosophy?)
    Last edited by fatfiremd; 07-27-2021, 01:47 PM.

  • #2
    Nice summary --

    1. Where do you want to live? Location location location
    2. TPMG is a lot better when we considered benefits and whether wife wanted to continue Kaiser from TPMG to San Diego move. You also missed the supplemental insurance TPMG offers on top of the gold membership. Delta Dental premier is a killer plan too. Had major surgery for kids and minimal copays. q3month cleanings even (if you like that much chair time).

    Wow buy-in 150k now? Was ~30k WAY BACK

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    • #3
      Originally posted by StarTrekDoc View Post
      Nice summary --

      1. Where do you want to live? Location location location
      2. TPMG is a lot better when we considered benefits and whether wife wanted to continue Kaiser from TPMG to San Diego move. You also missed the supplemental insurance TPMG offers on top of the gold membership. Delta Dental premier is a killer plan too. Had major surgery for kids and minimal copays. q3month cleanings even (if you like that much chair time).

      Wow buy-in 150k now? Was ~30k WAY BACK

      1. Silicon Valley is better for spouse as it gives more work opportunities (FAANG). However LA is more fun.

      2. I forgot to mention TPMG housing loan, so I guess thats another benefit, though house prices seem crazy. They said the interest rate was like 1.5% these days for 10 years on 10% purchase price up to a 2MM house. Probably not going to utilize until actually a shareholder though. Also, wow didnt know dental was so awesome. Their vision plan seems kinda subpar though (not much glasses/contact benefits) but at least its free.

      3. Yes, people have been telling me there's some sort of deal with them and the insurance company where Kaiser insurance funds the stock plan growth at the set rate of the stock market which was like 10% or something when Dr. Pearl was CEO if Kaiser insurance was profitable. This seems about as unstable as healthcare in general, but apparently they had been getting 10% ups through everything - housing crisis, obamacare, COVID. Because its hard for new docs apparently the minimum buy-in is 40k, but the max buy in goes up to 150 this Jan? And in 3 years it might be 199k? Just talking out of hearsay now so hopefully someone actually knows whats going on. It just seems like a nice way to get some private equity, and if your company is successful, so are you (like a FAANG stock option)

      Doing back-calculations - I'm guessing you bought your stock around 17 years ago?

      Last edited by fatfiremd; 07-27-2021, 02:44 PM.

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      • #4
        Also - can anyone explain any benefits of being a partner or having K1 status rather than W2? It seems that alot of people feel that SCPMG is great because you're an owner, but what does that actually mean in terms of real benefits? Are there different tax-avoidance strategies that I'm missing?
        Do they lower your partnership "income" and increase your "dividends" (from my understanding the dividends are taxed based on capital gains rather than income tax?). Do you get "loss credits"? Or are you just stuck paying all the taxes and employee benefits?

        Last edited by fatfiremd; 07-27-2021, 02:45 PM.

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        • #5
          Excellent and detailed comparison. Some observations regarding TPMG.

          Salary increase is about 1% after 10-15 years of service. The salary increase is higher in earlier years. The idea is to have similar pay for similar work, regardless of seniority.

          As previously mentioned, do the after tax contribution in the 401k. Notice this is different from the non-qualified deferred compensation plan that can significantly reduce AGI and income tax. However be aware this is a "non-qualified plan" and is subject to creditor.

          Expect to work extra 1-2 hours each day for desk top medicine, including calling patients, inbox, emails, refills, work slips, etc. Calls are equally distributed regardless of age. In larger departments, there usually is option to give up calls for "adoption". Often, some physicians pick up calls to reduce hours in the office and increase pay. For the past years, there have always been opportunity for extra hours, especially during the summer months and holiday season. Some colleagues could generate extra 0.5-0.8 full time equivalents monthly.

          As I mentioned in a different post, the increase in share price is similar to S&P500 for the past 10 years.

          With prudent investment, even as a W2 employee, FIRE is possible. I am currently at cross road at age 50. Consider the golden handcuffs and loss of health care coverage and reduced pension.

          Choose family and location. In 20 years, it may not matter much TPMG vs SCPMG.

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          • #6
            Detailed and excellent comparison.. Appreciate sharing this information..

            Comment


            • #7
              Originally posted by CalMD View Post
              Excellent and detailed comparison. Some observations regarding TPMG.
              As previously mentioned, do the after tax contribution in the 401k. Notice this is different from the non-qualified deferred compensation plan that can significantly reduce AGI and income tax. However be aware this is a "non-qualified plan" and is subject to creditor.
              Do you mean the after-tax is non-qualified or DCP?

              Comment


              • #8
                Originally posted by fatfiremd View Post
                ...
                3. Yes, people have been telling me there's some sort of deal with them and the insurance company where Kaiser insurance funds the stock plan growth at the set rate of the stock market which was like 10% or something when Dr. Pearl was CEO if Kaiser insurance was profitable. This seems about as unstable as healthcare in general, but apparently they had been getting 10% ups through everything - housing crisis, obamacare, COVID. Because its hard for new docs apparently the minimum buy-in is 40k, but the max buy in goes up to 150 this Jan? And in 3 years it might be 199k? Just talking out of hearsay now so hopefully someone actually knows whats going on. It just seems like a nice way to get some private equity, and if your company is successful, so are you (like a FAANG stock option)

                Doing back-calculations - I'm guessing you bought your stock around 17 years ago?
                Yep - , buyin ~2003-2004 -- with new trip to Monterey too.

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