Physician Compensation Increased in 2019

Physician Compensation Increased in 2019

Medical Group Management Association (MGMA) released its 31st annual Provider Compensation and Production Report, the most comprehensive view of provider compensation in the United States. Despite the uncertainty surrounding the COVID-19 pandemic, MGMA received supplemental data with a 14% increase in total participating providers in early 2020, representing data from more than 168,000 physicians and nonphysician providers (NPPs) in over 6,300 organizations, the highest number of participants to date.


Average total primary care physician compensation rose 2.6% from 2018 to 2019, reaching $273,437. Overall, compensation for most physician specialties continued to increase. Urgent care and pulmonary specialists led these salary increases, from $259,661 to $277,393 and $385,024 to $406,245, respectively.


Among the report’s key findings, the top five most sizable increases in total compensation for established providers between 2018 and 2019 include the following medical specialties:


•    Psychiatry (general): 7.69%
•    Urgent Care: 6.83%
•    Pulmonary Medicine (general): 5.51%
•    Internal Medicine (general): 4.00%
•    Urology: 3.85%


NPP Compensation on the Rise


NPPs also experienced a 2.13% increase in compensation from 2018 to 2019. Notable compensation amounts for nurse practitioners (NP) and physician assistants (PA) include:


•    NP (nonsurgical/nonprimary care): $108,861
•    NP (primary care): $109,925
•    PA (primary care): $112,924
•    PA (nonsurgical/nonprimary care): $116,656
•    NP (surgical): $116,964
•    PA (surgical): $129,183


Over the past five years, total compensation for NPPs increased at a rate of 5% to 9%.


COVID-19 Pandemic Impact on Physician Compensation 


According to an April 7 MGMA Stat poll, 97% of medical practice leaders reported a drop in patient volume amid the COVID-19 pandemic. A separate COVID-19 financial impact report by MGMA found that, on average, practices reported a 55% decrease in revenue and 60% decrease in patient volume since the beginning of the COVID-19 crisis. These significant impacts to medical practices of all sizes and specialties forced many to lay off and/or furlough staff.


“With 1.4 million healthcare workers furloughed in the last month alone, this 2019 compensation data will serve as a baseline for benchmarking 2020 operations in the aftermath of the COVID-19 pandemic,” said Halee Fischer-Wright, MD, MMM, FAAP, FACMPE, president and chief executive officer, MGMA. “COVID-19 has had a dramatic impact on the healthcare industry with productivity halting for many medical practices. Compensation models will look different in the near future based on shifting productivity and demands on physicians and the healthcare industry overall.”


Productivity Increases with Compensation


Many physicians experienced an increase in productivity, even upwards of a 10% increase for some specialties. In a field with growing shortages, physicians are working harder than ever to meet the needs of patients by offering more appointment times and performing more procedures and surgeries. Many physicians are compensated completely or at least in part based on their work relative value units (wRVU) productivity, so increasing volumes is beneficial to physicians in terms of compensation while also meeting patients’ needs. With almost all physicians current tied to productivity or collections-based pay models, the correlation between increased volume and higher pay will remain a trend. However,
with volumes decreasing for most practitioners as a result of the COVID-19 crisis, compensation will also likely suffer. Providers on salary-based contracts are shielded more from lost productivity, but their salaries are dependent on the financial viability of their organization.
Beyond the unprecedented challenges of COVID-19, projections of significant physician workforce shortages throughout the country by 2030 will likely intensify demand for physicians, which could drive compensation higher.


New Hire Compensation Increases 


The most notable new hire provider compensation increases in the last year include:


•    Cardiology (noninvasive): 15.38%
•    Gastroenterology: 14.29%
•    OB/GYN (general): 4.68%
•    Surgery (general): 3.70%
•    Radiology (diagnostic): 3.69%
•    Neurology: 3.19%


Geographic Compensation Differences


Compensation for providers ranges dramatically by state. Primary care physicians earn the most in West Virginia, with nearly $200,000 more in total compensation than their counterparts in Vermont, the lowest paying state. The difference in surgical and nonsurgical specialist pay is even greater with physicians earning $260,000 more in the highest-paying states of South Carolina and Alabama, compared to their lowest-paid counterparts in Vermont and Maryland.


The Southern and Western regions of the United States report the largest compensation rates for physicians in 2019. For the second year in a row, the Eastern region reports the lowest compensation rates for physicians.


Geographic areas that have seen the greatest impact from COVID-19 shutdowns on patient visits and non-essential procedures and surgeries will take the biggest hit from lost productivity and associated impacts to physician compensation until patient volume returns to normal.


MGMA Report Methodology


The 2020 MGMA Compensation and Production Report represents comparative data from more than 168,000 providers in 6,300 organizations. The report is based on a voluntary response by MGMA member and nonmember practices. On January 6, 2020, MGMA opened the 2020 Compensation and Production Survey collecting data on physician and non-physician provider compensation and productivity reflective of 2019. Email invitations were sent to eligible participants across a variety of audiences including private practices, hospitals, integrated delivery systems, universities and academic departments. All responses to the questionnaires were collected online and underwent rigorous evaluation and inspection. The collected data is reported online in the 2020 MGMA DataDive Provider Compensation. Information from MGMA surveys are published in MGMA DataDive.




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