Which Regions of the Country Pay Physicians More?

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     According to the Medical Group Management Association (MGMA), it seems physician compensation can vary significantly based not only on their department rank in an academic setting, but also on their geographic setting. For instance, in an academic setting, primary care associate professors earned a median compensation of $173,963, professors brought in a median compensation of $198,000, while department chairs reported a median compensation of $282,296.

     In terms of geography, dermatologists in an academic setting, based in the Midwest, reported a median compensation of $227,765 while the same group in the Western region reported a median compensation of $234,936. This trend continues with general pediatricians in the Eastern section reporting $157,289 in median compensation while their Southern region counterparts reporting $139,410 in median compensation. Furthermore, urologists in the Midwest had a median compensation of $300,000 as opposed to the $445,247 median income of the urologists in the Western region.

     By this data, it seems as though one region does not pay all specialties more or less than any other region. Regional compensation also seems to be influenced by a physician’s specialty as well as their geographic location.

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The Cost of Adding Additional Medical Staff

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Are you looking to add additional medical staff but cannot afford the cost of bringing in another physician? The utilization of physician’s assistants may be the solution to your predicament.

One huge advantage to adding physician assistants rather than physicians is that physician assistants have a high Return on Investment (ROI). According to the Medical Group Management Association (MGMA) Physician Compensation and Production Survey 2011 Report, the typical physician assistant brings in $241,000 in annual revenue with an average salary of only $86,687 (national average income).

After recovering salary, benefits, and incremental overhead, a typical physician assistant can boost the bottom line of a practice by an estimated $25,000 to $30,000 or more annually.

In addition, the average cost of recruiting a highly qualified physician assistant can run significantly less than the costs of recruiting a physician and licensing that physician on average.

Next time you consider adding a new provider, a physician’s assistant might be the solution.
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Mark Foutz is a Director of Business Development at Fidelis Partners.
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How Will Bundled Payments for Care Improvement Affect Physician Compensation?

     On August 22, 2011, The Center for Medicare and Medicaid Services (CMS) innovation arm launched the “Bundled Payments for Care Improvement” program. This program outlines four different bundled payment models which provide an opportunity for providers to implement bundled payment systems which would also help control CMS’ costs.

     Trends like these will most certainly affect physician compensation models in the future. The CMS has launched a pilot program around paying hospitals, physicians and other providers a bundled payment for a diagnosis-related group (DRG) or DRGs and/or all associated post-acute care. This allows hospitals to gainshare cost savings generated through this initiative, providing a direct, meaningful incentive that hospitals have not traditionally been able to offer.

     Three of the initiatives would involve a retrospective bundled payment arrangement, with a target payment amount for a defined episode of care while the fourth initiative would be paid prospectively. The Bundled Payments Initiative would allow CMS to link payments for multiple services patients receive during a single episode of care, allowing more efficient delivery of health care and improvement in quality of care.

     Our clients with strong medical staffs and executive leadership are more likely to be successful with bundling efforts. Anyone interested in bundling would have filed a letter of intent to participate by March 2012 if inclined to do so.

     Please keep this in mind as you discuss compensation offers in the future. Below is a summary of the four initiatives offered:

     Model 1 defines an episode of care as the inpatient stay in the general acute care hospital.

     Model 2 defines an episode of care to include the inpatient stay and post-acute care and would end either a minimum of 30 or 90 days after discharge.

     Model 3 says the episode of care begins at initiation of post-acute care with a participating Skilled Nursing Facility, Inpatient Rehabilitation Facility, Long-Term Care Hospital or Home Health Agency within 30 days of discharge from the inpatient stay and would end no sooner than 30 days after the initiation of the episode.

     Model 4 entails CMS making a single prospectively determined bundled payment to the hospital that would encompass all services rendered during the inpatient stay by the physicians, hospital, and other practitioners.
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David Curtis is Executive Vice President of Business Development at Fidelis Partners.
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Don’t Rule Out the Rural Emergency Rooms

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     Are you money motivated? If you are, a rural emergency room may be a perfect option for making excellent money outside of a busy, stressful, high volume, trauma center. Too many times I hear physicians say it’s all about the money, and that “if you can’t pay me $250 per hour or more, I am not interested.” Keep an open mind. Don’t get me wrong, these rates can be achieved, but be ready to step into an emergency department that hasn’t slept in years. In many cases, if a physician is going to be out of their home on an assignment for 4 or 5 days, it is quite possible working in a lower volume, less acute, rural facility may actually pay a little more in that time frame. For example, for a five day assignment in a low volume emergency room, you could make over $1,500 more than a 5 day assignment in a higher volume facility. How you ask—a lower volume emergency room (maybe seeing 7,000 visits annually) will usually allow physicians to run 24 hour shifts. So in a 5 day assignment, a physician could work 24 hours on, 24 hours off, and so on for a total of 72 hours worked and 48 hours off. On the other hand, a higher volume facility will only allow physicians to work 12 hours at a time, so in five days, the physician would only be working about 60 hours total. Although the lower volume facility may be paying less per hour, physicians can work more hours which equates to more money total for the assignment than fewer hours worked for higher pay. Also, working in a lower volume facility gives you the chance to breath. You have the ability not only to supplement your income but you would have time to sleep, study for continuing education tests, and so much more all while getting paid. So next time you get a call from a Medestar recruiter offering a locums position paying a lot lower than you expect, be sure to keep an open mind-it may mean more money for you in the end.
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Nick Rogers is Director of Recruiting at Medestar.
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Is There a Pay Gap Between Female and Male Physicians?

     Unfortunately the answer is yes.

     A study released in 2004, authored by Timothy J. Hoff, PhD, associate professor at StateUniversity of New York at Albany, showed that female hospitalists earned approximately $22,000 less per year than their male counterparts, despite similar work patterns. The study controlled for a wide range of professional and personal variables including clinical workload, compensation type, employer type, marital status, and tenure in hospital medicine.

     Another study, released last year in Health Affairs, found that male physicians newly trained in the state of New York made on average $16,819 more than newly trained female physicians in 2008. This is up $13,219 from the difference in 1999 of $3,600 between the male and female physician compensation rates. The authors of this study controlled for specialty type, hours worked, designation of hours, immigration status, age, and practice location. Job tenure, institutional rank and job productivity were not factors in this study since the focus was solely on starting salaries.

     Finally, according to the 2011 SHM-MGMA compensation and productivity survey, mean annual compensation for female physicians in family practice, internal medicine, and pediatrics is lower than that of their male counterparts by $4,448, $29,211 and $23,402 respectively. Liz Boten, a spokeswoman for the Medical Group Management Association (MGMA), says factors such as practice location, practice ownership and productivity can have an effect on compensation and could be a reason behind the disparity, but most likely does not account for the entire difference in compensation.

     Even more problematic than the wage gap itself, is trying to understand why it still exists and why it won’t close. So what is being done to try to close this gap? Well, on the most basic level, organizations need to conduct self-audits to assess whether men and women are being compensated equitably, and make adjustments when necessary. Furthermore, organizations can adopt policies to promote pay transparency and allow employees to discuss compensation and suggest ways it can be improved.

     In workplaces where compensation discussions are discouraged, women need to take it upon themselves to informally speak with their male friends to gather information and determine if there is a pay gap issue before taking other actions.

     Although equal pay laws exist at the federal level, such as the Lilly Ledbetter Fair Pay Act and the Equal Employment Opportunity Commission, there is not an easy way to enforce such laws. Without enforcing legislation, there is no real way for legislation to make a difference in the compensation gap.

     Employers and government forces should have a significant role in closing the pay gap, however, women also need to advocate for change when necessary.

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