This topic comes from a question I received from a client asking to explain how nurse practitioners fit into a physician run group. She expressed her surprise to learn that many APPs and physicians who work in a hospital are not employed by the hospital and asked for feedback about how this works and how nurse practitioners fit into this model. I definitely understand this confusion. As nurses, we are used to standard hospital or health system employment with clear hierarchical management. In this post I’ll talk about my experience with this and the main differences between NPs and RNs in regards to:

1. Who employs you.

2. Who manages/directs you.

3. How you get paid.

4. Who your colleagues are.

1. Who is your employer?

I’m referring to the person who signs your paychecks; decides if you get raises; has their logo on your badge. The classifications below are broad sweeping generalizations. There will be some crossover for RNs. For example, most nurses are employed by systems - hospitals, home health companies, schools, etc. But some will be employed in private practice clinics or as 1099 contractors, it’s just less common for nursing.

RN: As nurses we are employed by hospitals, clinics, government bodies like DHR or the VA, or large healthcare systems like Kaiser. To name a few examples. Some nurses work for agencies which contract with said system/hospital and these nurses are either traditional W-2 employees or 1099 contractors.

NP: Typically employed by a physician group, are 1099 independent contractors, or employ themselves as a practice owner. They do not work for the hospital or health system. These can be small, as in private practice with a single physician and you, up to quite large.

Private Practice Clinics: These practices are physician/APP owned and operated and therefore they have no outside stakeholders like a hospital board of directors. They can therefore decide how to structure the business. They are typically for-profit organizations. The livelihood of the business depends on how it generates income. Thus the practice culture is driven by the owner. If they value an intimate, family-feel it can be a very rewarding place to work. There is a strong motivation to hire and maintain a well-run crew of staff. However, if their motivation is strictly money you can see how it could be quite toxic. Friends I know who work private practice really like the more “family feel” of the group.

Private Practice Physician Groups: Teams of physicians/APPs who contract with or affiliate with the hospital. Like the above, they govern themselves and are for-profit so the motivations remain the same. The difference is they have to maintain responsibility to the health system and in turn, their board of directors and other administrators. The cool thing is, if things go south the group can decide to dissolve the partnership with the hospital/system. Thus they hold some leveraging power. A lot of ED, anesthesia, and other specialties are private practice groups.

Health System Affiliated Physician Groups: Teams of physicians and APPs who are owned by the hospital but employed by the group. More closely tied to the hospital governance and therefore subject to whatever changes the hospital board and administrators deem is necessary. In some instances these are small groups but more commonly these are large umbrella corporations that encompass numerous specialties. Most hospitals and hospital groups are not-for profit so often the leadership is focused on improving community health which may or may not align with the vision the clinical providers desire. Less leveraging power. The benefit is typically these are higher paying positions and there is more upward mobility options.

2. Who is your manager/director?

This speaks to chain of command but starts with the person to whom you directly report.

RN: As nurses we are used to a hierarchical structure aka linear chain of command. For example a nurse will report to their charge nurse who reports to an assistant manager who reports to their unit manager who reports to a service director who reports to various upper level management nurses all the way up to the CNO. It is very direct and easy to follow. Support staff are clearly delineated so you know to whom you direct needs/concerns.

NP: As a nurse practitioner your direct report is not as clear. In some organizations there may not be anyone. Heck, you as a nurse practitioner can own your practice and be your own manager. The reason for the obscurity is the general approach to team management for providers. It tends to be a flat structure; less layers; far fewer upper middle management; far fewer support staff. There are also different types of support - my collaborating doctor is not necessarily my supervising doctor, my director is not necessarily supervising me clinically. The roles are also less well delineated. Some teams have an APP lead and this is the person who represents you at meetings with physicians and administration. They may or may not be the person who provides feedback or punitive directives. They may or may not be the person who performs your evaluation. They may or may not be the person who creates the schedule and handles other executive functions/requests.

In my experience medical service teams typically consist of two sides:

One is core clinical staff (APPs and MDs), possibly an APP lead, a collaborating physician, a medical director for your team, and higher level physician or APP positions like CMO or system wide lead APP who functions primarily administratively (hiring, onboarding, running fellowships, etc.). Ok, this part is easy to understand because it is still fairly similar to nursing.

Now let’s talk about the other side of nurse practitioner management and that is administration. As an NP you will have much closer access to the administrative and higher lever executive officers in your system than you did as a nurse. You will see and hear things that are closer to leadership in regards to team/health system/hospital development. You may go to quarterly business meetings. You will hear more about how hospitals/systems are funded and how you contribute to this. The administrative team members range in scope from practice management (making sure a team is billing and getting reimbursed properly; scheduling; filing your expense reports; ensuring compliance, etc) to executive management and directly in charge of your review, salary, employment, and more.

So who is managing you as a nurse practitioner? Could be one of many people or could be several people, each in different capacities. As a result the less hierarchical chain of command makes things a bit more confusing and varies greatly from practice to practice.

3. How are you paid?

RN: Most commonly W-2 employee. Some nurses work for travel or temp agencies and are classified as W-2 or they can be 1099 independent contractors. This means they pay their own taxes. It can be a lucrative option. It’s pretty straight forward. This is a non-billable service you are providing to the employer. However, to maintain safe staffing ratios they must employ a certain number of nurses so there are often more enticing incentives when there are shortages as opposed to that of NPs. As an NP, the service you provide could be done by other types of providers like physicians, residents, etc. Since there are more people to fill in and the workload can be distributed the employers tend to not be eager to offer short staffing incentives. (This is not ubiquitous but has been my experience)

NP: Similar to RN’s can be W2 or 1099. The difference is that as an NP you are more commonly paid a salary with opportunities for a bonus. Some NP roles are copycat of RN’s - hourly, accruing PTO, paid shift differentials and or incentives for shortages/OT, relying on an annual review for a raise, etc. But many are not. Many are contracted like physicians - required number of shifts per year versus week, working 7on/7off, with potential to earn RVU or quality metrics bonuses. The administrators I know view APPs like physicians. Meaning they generate income. Some service lines allow NPs to bill which is direct income you bring to the practice. Some teams have the physicians bill as the reimbursement rate for NPs is below that of physicians. Either way, the difference is that you provide a financially quantifiable service. You can therefore, “prove your worth” as I hear NPs say time and time again. Often we have to fight for raises or even to maintain our jobs. The objective data supporting how much revenue you generate is a powerful illustration of what you do or do not justify earning. Another component of NP reimbursement is CME money.

4. Who are your colleagues?

Honestly, this is one of the saddest parts of becoming an NP.

RN: Depending on the size of your workplace you could have quite a large number of RNs working alongside you. This has a multitude of benefits like: ease of switching shifts, more frequent opportunities for upward mobility, more resources, and honestly, just more friends.

NP: In most instances you will only have a few NP colleagues. Even for some of the largest groups you may be spread out geographically across hospitals, so you may not see your colleagues. One of the hardest parts of transitioning was in working more closely with doctors and having fewer “equivalent” co-workers. In some teams the physicians view APPs as partners and it can be very rewarding. The good news in this is that with a smaller group comes much closer relationships. All the NP jobs I have had it’s been me and one other NP workign alongside each other all day, and at night it may just be my all by my lonesome. Not having as many resources to bounce ideas off of, or switch shifts with, or just connect with - well, it takes some adjustment.