Research the different types of associateships to decide what best fits with your short and long term ambitions.
Employee - An employment agreement defines the relationship with the practice – how you'll be paid; when you're expected to be there; vacation and sick time. As an employee, you may start with a salary but shift into a percentage of collections. Your employer pays taxes on your behalf, which are then deducted directly from your paycheck. Employees are protected under many work environment laws. Conversely, you'll likely be signing 'restrictive covenants' and non-solicitation clauses. Non-competes are restrictive covenants - you can't work for someone and then open a practice that directly steals their business. Non-solicitation clauses say you can't work for someone and then open a practice that tries to steal your former coworkers. An employee contract can also define continuing education parameters. This can describe to what extent the employer would help pay for continuing education, additional certification, etc.
Independent contractor - A contractor is not an employee of the practice. The arrangement is much different in terms of taxes and level of control over your working behavior. Because an employer has to pay social security, Medicare and unemployment taxes on employees but not contractors, the distinction parameters are clearly outlined by law. If you're told when to be at work, what patients to see when, and using the instruments and materials of the practice, then a legal argument can be made that the relationship is not that of an independent contractor. Contractors are often responsible for securing own patients. This opens doors for work at a practice with no patients to spare.
Time-share/Solo group - This is an independent contractor who may rent out the space and equipment. It's distinguished mostly by the contractual agreement regarding sharing everything, including staff. After your productivity reaches a certain consistent level as agreed upon, you, as an associate, acquire a portion of goodwill. Goodwill is ownership of the intangible aspects a dentist cultivates through seeing patients, calculated as a percentage of your annual productivity. Contracts are drawn up dividing ownership of equipment, furniture, etc. Solo groups can form a third entity for the management of shared assets and for tax and health coverage purposes. It can be beneficial for as a means of opening up a wider array of opportunities for dentists to practice. It can also be used as a temporary working situation, as for checking out a new city or transitioning into owning a practice. A good resource on this topic is the book Business, Legal and Tax Planning for the Dental Practice.
Large group practice – A Large Group Practice is a large company that owns this among many other practices. The arrangement shares many features as traditional associateships, with some differences in organizational and management structure. Third party management services teams will conduct direct assessments of performance and handle other staff relations issues. This can translate to less opportunity to discuss and shape the philosophy of the practice. Keep in mind LGPs are new and still evolving. For more information on classifications of Group Practices, ADA members may review the ADA Health Policy Institute Research Brief: A Proposed Classification of Group Practices.
Find more in-depth information on choosing the right associateship on the Center for Professional Success.