Physician Compensation Increases Are Outpacing Productivity Gains, New AMGA Report Finds

Aug. 27, 2019
Physician compensation continues to rise, even as productivity has not risen to match the same level of increase, according to a new compensation survey released Tuesday by AMGA

Physician compensation continues to rise, without a concomitant increase in productivity, placing added cost burdens on patient care organizations: that is one of the findings of a new compensation survey announced by the Alexandria, Virginia-based American Medical Group Association (AMGA) by press release on Aug. 27. AMGA’s 2019 Medical Group Compensation and Productivity Survey includes 2018 salary data for 143 medical specialties, primary care subspecialties, advance practice providers, and other clinical professionals.

The survey, conducted by AMGA’s subsidiary, AMGA Consulting, found that overall physician compensation increased by a median of 2.92 percent, compared to a 0.89 percent increase the previous year. Productivity increased by 0.29 percent, compared to a 1.63% decline in 2017. Compensation per wRVU ratio increased of 3.64 percent, compared to a 3.09 percent increase the previous year.

“The 2019 survey shows that physician compensation in 2018 rebounded from a stagnant 2017,” said Fred Horton, M.H.A., AMGA Consulting president, in a statement contained in Tuesday morning’s press release. “While productivity also increased, it did not increase enough to surpass the decline we saw in last year’s survey, meaning productivity still has not risen since 2016.”

In 2018, median compensation for all primary care specialties increased by 4.91 percent, up significantly from 0.76 percent in 2017. While compensation increased more than it had over the past several years, productivity was flat, with wRVUs increasing by only 0.21 percent in 2018. As a result, the median compensation per wRVU ratio increased 3.57 percent, the largest increase for primary care specialties in four years. 

Meanwhile, medical specialties saw an increase of 1.9 percent in median wRVU production over last year’s survey. The compensation per wRVU ratio increased by 2.65 percent, and the overall median compensation was up for medical specialties by 3.39 percent. A sample of medical specialties with more remarkable changes to the compensation per work RVU ratio are cardiology, dermatology, gastroenterology (GI), hospitalist–internal medicine, and psychiatry.

With regard to increased pay for primary care physicians, Elizabeth Siemsen, AMGA Consulting director, said in a statement in the press release, “As healthcare organizations move from volume-based to value-based payment models, we’ve observed increased scrutiny on primary care performance. Medical groups continue to focus on delivering care in the most appropriate setting with the greatest efficiency—and often place primary care providers at the center of this strategy. Concurrently, in recent years,” she added, “the AMGA survey has shown a slow uptick in the proportion of primary care physicians reported at less than a 1.0 clinical FTE, indicating an increase in part-time providers. In order to recruit and retain the primary care workforce, it may be that the market demanded a compensation course correction this past year.”

“Data from this year’s survey shows compensation is increasing without an equivalent increase in wRVU production for many specialties. This trend is causing organizations to absorb additional compensation expenses without balancing revenue from production increases,” Horton said. “More intentionally transitioning to value-based care is one strategy medical groups can use to mitigate this trend, as it would help them better clarify their organizational strategies and objectives.”

The report also noted  that “Care model changes are also leading nurse practitioners and physician’s assistants to more frequently work with their own panel of patients. However,” it added, “pure production compensation models are less common for advance practice providers.”

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