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Finance: Getting More — Our Annual Physician Compensation Survey
Compensation survey shows more income, less pain in primary care
By Shirley Grace

Granted, there’s still much work to do, and it would sure be swell if most physicians could mark the “robust — my practice is thriving and my margins are solid” box. But that means changing — a scary concept to many. It can be done, though. Family-practice-doc-turned-hospice-specialist Marsh did it. The joy of practicing medicine resonates in his voice as he describes how fulfilling hospice work is to him. “I go out to people’s homes, and you see what’s really going on in their lives. You see why they are the way they are,” he says. “We’re not just ‘death angels.’ We work as a team — the nurses, the chaplain, the doctors, everyone. We help the whole patient.”



Marsh’s stance is that many physicians unwittingly self-sabotage their own happiness with the very traits that help them become good doctors: autonomous, perfectionist, hard-working. “Some of the expectations that we put on ourselves limit our abilities,” says Marsh. “We’re very independent, which is part of our problem.”

It’s a fine balance, using these common traits advantageously. Indeed, Norton believes in good ol’ hard work. He and his partner do everything they can to make their family practice as accessible and attuned to their patients’ needs as possible. This means an open-access scheduling model, which he says encourages patients to come to his office, rather than an urgent care clinic, emergency room, or retail clinic. He relies on hospitalists for his admitted patients (except for children, but this only happened twice in the past year). “Using the hospitalist service has allowed me to see more patients in the office vs. rounding in the hospitals,” says Norton. This, of course, increases his volume.

Norton also believes in keeping a tight focus, saying, “I don’t believe in increasing revenue by using a lot of unnecessary ancillary procedures.” Most doctors seem to agree with him on this, by the way. This year, we polled physicians on whether they supplement their incomes with ancillary services. About 85 percent said uh-uh, not happening. For the few that do, 9.0 percent do some sort of in-house diagnostic testing, 3.4 percent perform minor surgical procedures, and a scant 1.9 percent sell health products.

Jaundiced eyes regarding ancillary services come from other perspectives as well. “A concern we’ve always had is that they’re trained to be a family-care physician; we expect them to do that,” says recruiter Mosley. “It all goes back to access. If they’re doing these other procedures, it takes away their access.”

Not only that, it’s often just not worth it, says Apostol. “When you try to add an ancillary service, some of the insurance companies start restricting your ability to offer them in-house,” he says. Because of this, he explains, “so many of the ancillary services you potentially could do are not financially feasible to do; some are even in the negative. So why bother?”

This is not to say that ancillary services have no place in a primary-care practice; certainly many of you have successfully incorporated such extra offerings into your normal scope for the benefit of both yourselves and your patients. But that’s the key word for success: scope. Straying too far from your core competencies can hurt your bottom line.

Other gut-wrenching changes may be easier to fantasize about than implement, for legitimate reasons. Norton has considered going to a cash-only practice model, “but I don’t think that would be accepted in my community of 100,000 — yet,” he says. Who knows when or if he will decide to make this radical shift in providing patient care? Maybe soon, maybe never.

As for Medicare, Norton’s stance is regretful, resolute, and increasingly common. “You can’t pay the bills if your payer mix includes a large percentage of Medicare or Medicaid,” he says. Any more cuts, and he’s outta there.

Be all you can be

Does Norton have all the answers to what ails primary-care physicians? Certainly not for everyone. But for Norton himself? Absolutely. Kudos to him, Marsh, and all physicians who devote thought to how they want to practice and then put those thoughts into action.
Too many of today’s physicians seem caught in the goo of inertia. Case in point: Roughly speaking, half of our survey respondents (46.21 percent) are partners in their practices, with the rest employed (53.79%). However, a disturbingly large chunk of the partners — about four in 10 — are not happy with their situations.



Consider also that more than three-fourths of all respondents — half of whom are partners — say they plan to keep on schlepping to work ad nauseam; only 7.63% plan to make some radical changes. And although it’s a small slice, get this: According to our survey, more physicians reported they’re actually planning to close (5.57 percent) rather than pursue some alternative way to practice medicine (join a larger group: 4.82 percent; be acquired by a hospital: 2.69 percent; start your own practice: 2.56 percent).



Additional Resources
View more articles from the November 2008 issue

View more articles related to Finance

View more articles related to Billing & Collections

 
 


 

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In Summary
The future of primary care is far from secure, but our survey shows a few encouraging signs of optimism:

  • Salaries rose to $171,500 — an increase of about 6.5 percent.

  • Approximately 55 percent of respondents report their overhead to be eating more than half their gross revenues; last year, this figure was 62 percent.

  • 17 percent of internists shifted their income perception from “disappointing” to “appropriate.”

  • Family-practice physicians showed a general upswing in earnings satisfaction, with 43.75 percent marking either “appropriate” or “excellent” — an 11.05 percent rise since last year.

  • Pediatricians showed the biggest change in income satisfaction: In 2007, 13.4 percent qualified their incomes as “excellent.” This year, that figure dropped to 7.94 percent.

  • Nearly half of respondents (47.24 percent) received no bonuses. Of those who did, nearly two-thirds (64.4 percent) report a bonus ranging between 1 and 10 percent.

  • Women tend to stick with the same practice longer than men: About one in 10 female physicians report staying in their current practice for 11 to 15 years, compared to just 3.23 percent of male physicians.

  • The urge to close up shop has dropped 10 percent since last year, to 3.6 percent.

  • About 85 percent offer no ancillary services. For those that do, 9.0 percent offer in-house diagnostic testing, 3.4 percent perform minor surgical procedures, and 1.9 percent sell health products.

  • About half of all respondents are partners in their practices.

  •  
    Read More About It
  • See all the charts and data from this year’s Physician Compensation Survey.

  • For more in-depth information about the possible pitfalls of adding services beyond your normal scope, read “Adding Ancillaries: Bucking the Practice.”

  • Read more about physician supply and demand projections on HHS’s Health Resources and Administration Web site by clicking on Physician Supply and Demand: Projections to 2020.