Washington Regional Medical Center recently won a judgment against a neurosurgeon who received a $48,000 signing bonus but quit before his first day at the Fayetteville hospital.
The case against Dr. Michael R. Raber gives an inside look at the recruitment process and the fallout felt by the 425-bed hospital when he backed out of the job.
Raber didn’t deny that he owed the hospital the bonus money, but he disputed having to repay $3,672 for payroll taxes the hospital paid on the bonus and $9,177 for recruitment expenses.
Washington Regional also wanted Raber to pay $305,912, which is the amount it paid a physician staffing firm, Hayes Locums LLC of Fort Lauderdale, Florida, to provide neurosurgery coverage necessary because of Raber’s failure to take the job.
Chief U.S. District Court Judge P.K. Holmes III of the Western District of Arkansas ruled that Raber had to repay the $48,000 plus the money for the payroll taxes and recruitment expenses, but that he didn’t have to pay for the neurosurgery coverage. Holmes also said he would consider awarding attorneys’ fees and costs to Washington Regional’s attorney, G. Alan Wooten of Conner & Winters LLP of Fayetteville. As of Wednesday, Holmes hadn’t ruled on that.
“Competition for neurosurgeons is fierce,” said Bo Ryall, president and CEO of the Arkansas Hospital Association, who was unfamiliar with the details of Raber’s case but willing to speak generally. Neurosurgeons are scarce and hospitals and medical systems need them, Ryall said.
Only about 200 neurosurgeons finish residency programs each year, said Allison Homer, a director of recruiting for Merritt Hawkins of Coppell, Texas, a physician search and consulting firm. She said about 3,800 neurosurgeons are practicing in the United States.
Neurosurgery is one of the biggest revenue generators for a hospital. On average, a neurosurgeon will produce $2.4 million annually for his or her hospital, according to the 2016 Physician Inpatient/Outpatient Revenue Survey by Merritt Hawkins. The study also found that the average annual salary for a neurosurgeon was $553,000.
Courting a Neurosurgeon
In early 2016, Raber was the chief resident at the Harvard Medical School of Boston when Washington Regional started courting him for a neurosurgeon position at its hospital, according to court filings.
Raber was finishing a fellowship at the Johns Hopkins School of Medicine in Baltimore when he made the first of three trips to northwest Arkansas to interview with Washington Regional.
The hospital said it spent $9,000 to cover his airfare, hotels and meals during the trip.
Raber decided to join the hospital in December 2016. His employment agreement said he would be paid a base annual salary of $716,000, but he could receive bonuses and other compensation to bring his total pay package to a maximum yearly amount of $1.5 million, according to court documents.
He was scheduled to start on July 1, 2017, to provide general neurosurgical services for Washington Regional and clinical services at Washington Regional’s Northwest Arkansas Neurosciences Institute. Raber said at the bench trial his primary responsibility was to build an elective spine practice with three other neurosurgeons, according to Holmes’ order.
On March 7, 2017, Raber called Washington Regional CEO Larry Shackelford and said he wouldn’t be coming to the hospital for personal reasons.
“Shackelford told Raber that patient care at WRMC was going to be adversely impacted if he did not honor his commitment because it would create a problem in emergency care coverage,” according to Holmes’ order.
Washington Regional is a Trauma II medical center, which requires hospitals to have 95 percent on-call neurosurgery coverage in the emergency department.
To fill the void left by Raber, Washington Regional hired Hayes Locums to provide neurosurgical coverage from July 1, 2017, to Aug. 1, 2018.
Raber started working at Baylor College of Medicine in Houston, Texas, on Sept. 7, 2017. His attorney, Stephen Lee Wood of Rogers, didn’t return a call.
Washington Regional said it hired another neurosurgeon who will start in 2019, according to Holmes’ order. A hospital spokeswoman declined to comment on the case.