Survey: Many providers continue to post losses; doc compensation up 3.8%

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Most specialties saw modest increases in compensation in 2009, but many provider organizations continue to operate at a significant loss, according to findings in the American Medical Group Association’s (AMGA) 2010 Medical Group Compensation and Financial Survey.

The survey by the Alexandria, Va.-based AMGA found that 76 percent of the specialties experienced increases in compensation in 2009, with the overall average increase around 3.8 percent (by comparison, 81 percent experienced an average increase of approximately 3.5 percent in 2008).

Primary care specialties (excluding hospitalists) saw about a 3.8 percent increase in 2009—the same as 2008—while other medical specialties averaged an increase of 2.4 percent, and surgical specialties averaged around 3.8 percent. (Primary care specialties saw about a 3.8 percent increase in 2008, while other medical and surgical specialties averaged 6 percent).

The survey reports that during 2009, the specialties experiencing the largest increases in compensation were:
  • Pulmonary disease (10.37 percent);
  • Dermatology (7 percent); and
  • Urology (6.36 percent).

The section of the survey that examines financial operations found that medical groups were still faced with significant financial challenges. Most regions were doing better than in 2008, but margins are thin, according to the survey.

In 2009, organizations in the eastern and western regions were operating at break-even levels. Organizations in the southern region continued to operate at a loss (-$1,034 per physician in 2009 versus -$120 per physician in 2008). Groups in the northern region continued to experience significant losses (-$9,943 per physician in 2009 from -$3,254 per physician in 2008).

Much of the losses in 2009 were supplemented by nonclinical revenue sources or funding from health systems with which groups are associated, the survey found. Most of the groups represented in the survey are part of large organized systems of care that make substantial investments in technology, operations and the most innovative care processes.

“Our current transaction-based reimbursement system is largely indifferent to these results and to the efforts of medical groups to elevate the standard of care in the U.S.,” said Donald W. Fisher, PhD, president and CEO of AMGA.

The 2010 Medical Group Compensation and Financial Survey studied compensation, productivity and financial operations data from approximately 49,700 healthcare providers throughout the U.S., including 121 specialties, 31 other healthcare provider positions and 27 administrative positions. The survey was conducted by the national accounting firm of McGladrey.