Physician Compensation II

Yesterday’s post displayed recent Bureau of Labor Statistic figures concerning physician compensation, and offered a link to recent median physician compensation data approved for use by Centers for Medicare and Medicaid Services (CMS) for calculations regarding direct graduate medical education under 42 CFR 413.78(f). The producer of this data, AMGA, also offers an interactive physician compensation survey which shows “average” and “starting” compensation for various specialties. A click on the arrow underneath “average” will sort from lowest to highest.

Here below is a list of a few of the CMS approved median physician compensation figures for a number of different specialties. The numbers are taken from the 2008 report.

The median compensation for a practitioner:

• Pediatric & Adolescent, Internal 161,444
• Pediatric & Adolescent, Infect. Disease 174,154
• Family Medicine, w/out Obstetrics 176,280
• Family Med., w/out Obst., Branch* 190,182
• Geriatrics 179,344
• Podiatry: 180,080
• Transplant Surgery, Kidney 368,750
• Dermatology, Branch* 301,111
• Dermatology, Mohs 423,848
• Not neural, Non-Interventionist, Radiology 420,858
• Mammography 540,028
• Orthopedic Surgery, Spine 611,670

*Branch is defined by AMGA as: These specialties have the same basic definition as the main specialty. These physicians located in small satellite or branch offices at least five miles from the main campus. The branch office practices primarily as its own separate entity, and often has different compensation and/or performance expectations than its main campus colleagues, there would be no teaching responsibilities at these locations.

With these numbers, over the course of ten career years, if calculated at a constant rate without regard to future increases in compensation, the median paid “Family Doctor, Branch” will have earned $1,900,182. During those same static ten years, a “Mammographer” will have earned $5,400,280. If the Family Doctor were to consult with the Mammographer at the end of those ten years, she would be doing so with someone who had made $3,500,098 more than she–nearly 3 times as much. If that same Family Doctor were to then consult with someone from the lowest paid of the three categories of Radiologist, Not neural, Non-Interventionist, she would be doing so with someone who had made $4,208,580 during that time-which would be $2,308,398 more than she–or more than twice as much.

Perhaps by way of consolation for the PCP, the Geriatrics specialist and the Pediatric Infectious Disease specialist would have fared worse, and even the Kidney transplant specialist who consults with the radiologist would be speaking with someone who had made a half of a million dollars more than he did.

But perhaps it is not consolation enough; the AMA has reported that the nation faces a shortage of 35,000 to 40,000 Primary Care Physicians.

Physician Compensation

The Bureau of Labor Statistics, U.S Department of Labor, Occupational Outlook Handbook, 2008-09 Edition, publishes the data shown immediately below regarding physician compensation. The BLS report lists Primary Care Physicians under “Family practice.” The Handbook states:

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Total compensation for physicians reflects the amount reported as direct compensation for tax purposes, plus all voluntary salary reductions. Salary, bonus and incentive payments, research stipends, honoraria, and distribution of profits were included in total compensation.

Footnotes:
(NOTE) Source: Medical Group Management Association, Physician Compensation and Production Report, 2005.
Self-employed physicians-those who own or are part owners of their medical practice-generally have higher median incomes than salaried physicians. Earnings vary according to number of years in practice, geographic region, hours worked, skill, personality, and professional reputation. Self-employed physicians and surgeons must provide for their own health insurance and retirement.

The American Medical Group Association (AMGA) offers a 2008 Physician Compensation Survey which is more comprehensive than the BLS data and has been approved for use in conjunction with the Centers for Medicare and Medicaid (CMS) regulations at 42 CFR 413.78(f) pertaining to calculations of physician pay (median) in reference to Graduate Medical Education. It features a wide range of specialist compensation data.

Health Benefit Costs Over Time

The U.S Bureau of Labor Statistics (BLS) offers a report: “Program Perspectives, On Health Benefits, recent data on employers’ costs and employees’ access.” The report (which also appears in the “Resources” section of this weblog) is user friendly and well worth the moment or two it would take to peruse it. It offers some interesting information on both relative cost and access. Of particular note, however, is “Chart 1,” which is a graphic representation of the “Employment Cost Index, private industry, 12 month percent change, health benefits and total benefits, 1982-2008.” Although BLS offers a caveat on the numbers, it cuts both ways.

BLS characterizes the data thus: “Over the last 25 years, health benefit costs for employers has moved in fits and starts.” The chart shows rapid accelerations in cost accompanied by periods of deceleration. In March1983 the cost of health benefits spiked 23.5% over the year prior; a similar (but not as large) rise may be seen from mid-1987 to mid-1988, and a protracted ascent may be seen from 1996 to 2002. BLS juxtaposes the health benefit costs with the costs of “total benefits;” in comparison, the movement of “health benefit costs” is precipitous.

BLS does not offer an explanation. It would be interesting to see charts which juxtaposed the cost of health benefits during this time period with the Inflation Rate, Interest Rates, Avg. ROI in the Stock and Bond Markets–and of course, the reported profit of the major commercial Health Insurance providers.