By Steven Ross Johnson | July 24,
2017
One of the lingering
challenges to recruiting more doctors to pursue a career in primary care over
the years has been the large wage differential found between those types of
physicians and just about every other kind.
THE TAKEAWAY
Demand for primary care
is on the upswing, leading to a boost in compensation for primary-care
physicians. But the industry has a long way to go before there is compensation
parity between primary-care doctors and most other physician specialists.
And while progress is
being made in paying primary-care physicians relatively more, in absolute terms
the highest pay still goes to the specialists who have traditionally been paid
the most, according to the results of Modern Healthcare's 24th annual Physician
Compensation Survey. The median income for an orthopedic surgeon was the
highest among 23 medical specialties in 2016 at $579,000, yet the median income
for a pediatrician was about 40% of that figure at $228,530.
Following orthopedic surgeons on the pay list were invasive cardiologists with an annual median income of $575,810, radiation oncologists at $515,999, gastroenterologists at $495,300, and radiologists with a median income of $477,390.
Click here for the Physician Compensation Survey results
After borrowing heavily to pay for medical school, medical students often find non-primary-care specialties to be a more attractive choice. "These people come out of training with massive loans and debt to pay back, and so there's still an incentive to specialize in more lucrative specialties from a compensation perspective," said Josh Halverson, a principal with healthcare consulting firm ECG Management Consultants.
Following orthopedic surgeons on the pay list were invasive cardiologists with an annual median income of $575,810, radiation oncologists at $515,999, gastroenterologists at $495,300, and radiologists with a median income of $477,390.
Click here for the Physician Compensation Survey results
After borrowing heavily to pay for medical school, medical students often find non-primary-care specialties to be a more attractive choice. "These people come out of training with massive loans and debt to pay back, and so there's still an incentive to specialize in more lucrative specialties from a compensation perspective," said Josh Halverson, a principal with healthcare consulting firm ECG Management Consultants.
Primary-care specialties such as internal medicine, family medicine, emergency medicine, pediatrics, hospitalist care and obstetrics and gynecology all remained at the bottom end of the physician pay scale despite most seeing steady rises in compensation from 2015 to 2016.
"I anticipate that the gap between primary care and some of the procedural specialties will continue, but I do see some acceleration of compensation for primary care," Halverson said.
Indeed, among the medical specialties that saw the biggest average percentage gains in compensation over that period were emergency medicine, which increased by 7.9%; neonatology, which increased by 6.9%; and hospitalist care, where annual pay rose by an average of 6.1% from 2015 to 2016.
Experts say the year-over-year increases in compensation have been a direct result of more competition among hospitals and other providers to hire professionals within certain medical specialties. And among the most highly sought after specialties are those within the primary-care field, most of which saw a marked rise in compensation the past year.
"The biggest movement that we've seen over the past 18 months in terms of rapidly shifting compensation are within primary care," said Steve Look, executive vice president with the healthcare recruiting firm Medicus.
Currently doctors in primary-care specialties make up roughly 48% of the entire physician workforce in the U.S., according to the Kaiser Family Foundation. An additional 8,500 primary-care practitioners would be needed to provide care for the more than 65 million Americans currently living in the more than 6,500 areas where there is less than one provider for every 3,500 people.
Growing demand has also been seen within psychiatry, where salaries rose by an average of 3.3%. The field was the second-most-recruited physician specialty behind family medicine from April 2015 through March 2016, according to a 2016 review of recruiting incentives by Merritt Hawkins.
Population health
influence
The increase seen in the
need for many primary-care specialties in recent years also reflects the move
by hospitals to pay greater attention to population health management, which
leads to more emphasis on quality and wellness. And as part of the change from
volume to value in care delivery comes the increased use of reimbursement
models that rely more on quality metrics.
"As we get into this new era of population health and chronic disease management, we look at those physicians that are maybe spending more time to manage that chronic population," said Travis Singleton, senior vice president at Merritt Hawkins. "Regardless of how it looks, we are fairly confident that quality is going to be a major driver of our healthcare system. The debate now is about by how much."
Efforts to tie doctor pay to quality have been underway on a wider scale since the CMS last October issued its final rule for implementing the Medicare Access and CHIP Reauthorization Act, which included provisions that replaced the sustainable growth-rate formula for determining how much doctors got paid under Medicare.
Some see the performance-based reimbursement models created under MACRA as already playing a role in the changes seen in physician pay for primary-care specialties. It's a role that they see will only increase in the coming years and be a larger determinant in how much physicians get paid, which could reduce pay for non-primary-care specialties.
"As MACRA becomes more firmly in place, and we begin to see quality parameters outstrip volume, then we do think that compensation will decline some," said Dr. C. Michael Valentine, vice president of the American College of Cardiology and an interventional cardiologist with Virginia-based Centra Medical Group, part of Centra Health. "We don't expect it to be a major drop, and we don't think it will be career-changing for anyone. We think this is just a natural progression in the healthcare system."
The greater role primary-care physicians will likely play within such a financial model will keep demand high and may induce hospitals to continue or increase incentives to recruit such clinicians. Some of those efforts have included signing bonuses of $5,000 to $15,000, loan forgiveness and relocation expenses for doctors and their entire families.
Medicus' Look said some of the hospitals and health systems that are most successful at attracting physicians can be found in large metropolitan areas where they not only have the advantage of being located in a large urban environment, but tend to pay above-average starting salaries and higher bonuses than more-rural providers.
Loan forgiveness or assistance could be important to steering more physicians into primary care. At least 79% of medical school graduates in 2015 had school debt totaling more than $100,000, with a median debt amount of more than $180,000, according to the Association of American Medical Colleges.
Dr. Richards Olds, president of St. Georges University, a medical school based in the West Indies, suggested medical schools offer more in the way of scholarships for students who promise to work in primary care in underserved areas upon graduation as one of the best ways to even the playing field between large and smaller providers for recruiting primary-care physicians.
"As we get into this new era of population health and chronic disease management, we look at those physicians that are maybe spending more time to manage that chronic population," said Travis Singleton, senior vice president at Merritt Hawkins. "Regardless of how it looks, we are fairly confident that quality is going to be a major driver of our healthcare system. The debate now is about by how much."
Efforts to tie doctor pay to quality have been underway on a wider scale since the CMS last October issued its final rule for implementing the Medicare Access and CHIP Reauthorization Act, which included provisions that replaced the sustainable growth-rate formula for determining how much doctors got paid under Medicare.
Some see the performance-based reimbursement models created under MACRA as already playing a role in the changes seen in physician pay for primary-care specialties. It's a role that they see will only increase in the coming years and be a larger determinant in how much physicians get paid, which could reduce pay for non-primary-care specialties.
"As MACRA becomes more firmly in place, and we begin to see quality parameters outstrip volume, then we do think that compensation will decline some," said Dr. C. Michael Valentine, vice president of the American College of Cardiology and an interventional cardiologist with Virginia-based Centra Medical Group, part of Centra Health. "We don't expect it to be a major drop, and we don't think it will be career-changing for anyone. We think this is just a natural progression in the healthcare system."
The greater role primary-care physicians will likely play within such a financial model will keep demand high and may induce hospitals to continue or increase incentives to recruit such clinicians. Some of those efforts have included signing bonuses of $5,000 to $15,000, loan forgiveness and relocation expenses for doctors and their entire families.
Medicus' Look said some of the hospitals and health systems that are most successful at attracting physicians can be found in large metropolitan areas where they not only have the advantage of being located in a large urban environment, but tend to pay above-average starting salaries and higher bonuses than more-rural providers.
Loan forgiveness or assistance could be important to steering more physicians into primary care. At least 79% of medical school graduates in 2015 had school debt totaling more than $100,000, with a median debt amount of more than $180,000, according to the Association of American Medical Colleges.
Dr. Richards Olds, president of St. Georges University, a medical school based in the West Indies, suggested medical schools offer more in the way of scholarships for students who promise to work in primary care in underserved areas upon graduation as one of the best ways to even the playing field between large and smaller providers for recruiting primary-care physicians.
Steven Ross Johnson has been a staff reporter for Modern
Healthcare magazine since 2013 and covers issues involving public health and
other healthcare news. Johnson has been a freelance reporter for the Chicago
Tribune, Progress Illinois, the Chicago Reporter and the Times of Northwest
Indiana and a government affairs reporter for the Courier-News in Elgin, Ill.
He received a bachelor's degree in communications from Columbia College in
Chicago and a master’s degree in journalism from the Medill School of
Journalism at Northwestern University.
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