Specialties see higher pay; primary care not so much

Pay incentives also fall out of favor as physicians opt for compensation based on straight salary or productivity numbers rather than on subjective measures.

By Julie A. Jacob, amednews staff. Aug. 5, 2002.

Earnings for many specialties rose significantly last year, while compensation for primary care physicians didn't keep pace, according to a survey by the American Medical Group Assn.

AMGA's latest Medical Group Compensation & Productivity Survey reports that median physician compensation rose most steeply for diagnostic radiologists, dermatologists and anesthesiologists, all up more than 9%.

Median compensation in medical groups
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Interventional diagnostic radiology led the survey with a $356,000 median and topped the chart with a 16.3% increase from $306,000.

The survey is based on data from 242 medical groups representing 31,000 physicians. AMGA's members tend to be from large physician groups.

The big increases in compensation for those specialties are driven by supply and demand, said Shawn Schwartz, manager at Minneapolis-based RSM McGladrey Inc., the consulting firm that conducted the survey for AGMA.

Compensation for interventional radiologists rose 16% last year, vs. 1% for family physicians.

"They are having to pay a premium to get those physicians recruited in," said Schwartz.

Compensation for primary care physicians rose only slightly, the result of a greater supply of those doctors, Schwartz said. However, the high percentage of part-time physicians in primary care fields skewed the median compensation downward, noted Schwartz.

Family medicine's median was $145,675, up about 1% from $144,200, and internal medicine paid $150,534, up 4.3% from $144,264.

RVUs, capitation and incentives

Another compensation trend is the increasing use of resource-based relative value units to compensate physicians, he said. About 48% of medical groups used RVUs partially or completely to determine physician compensation in 2001, compared with 28% of medical groups in the 2000 survey, said Schwartz.

In addition, capitation is continuing to decrease as the percentage of total revenue in medical groups.

However, it's unclear whether groups are accepting fewer capitated contracts or are simply getting a bigger percentage of revenue from discounted-fee contracts, Schwartz said.

Almost half of physician groups use resource-based relative value units to calculate pay.

Greater reliance on discounted fee for service may not be a good thing for all groups, he noted. "Discounted fee schedules, for some groups, are worse than capitation. ... Payers are becoming more aggressive at negotiating those fee schedules, trying to get them all straight and making sure they are not losing money."

Another trend is the dwindling use of incentives as a factor in physician compensation, added Schwartz.

"There's been a complete reversal of that to the point where little to none of physician compensation is based on any incentives," he said. "It is a straight productivity measure or a straight salary."

Incentives have fallen out of favor, he said, because physicians don't want their pay based on subjective measures.

ADDITIONAL INFORMATION:

Median compensation in medical groups

                        2001       2000    Change
                      --------   --------  ------
Anesthesiology        $278,964   $255,651    9.1%
Cardiology                                       
  cath. lab           $310,500   $286,000    8.6%
  general             $287,163   $271,001    6.0%
Dermatology           $220,766   $198,196   11.4%
Diagnostic radiology                            
  interventional      $356,000   $306,000   16.3%
  noninterventional   $302,704   $262,579   15.3%
Emergency care        $204,518   $190,179    7.5%
Family medicine       $145,675   $144,200    1.0%
Internal medicine     $150,534   $144,264    4.3%
Ob-gyn                $230,804   $228,663    1.0%
Pediatrics            $149,429   $143,468    4.1%
Urology               $276,798   $274,063    1.0%

Source: American Medical Group Assn., 2002 Medical Group Compensation & Productivity Survey