10-year trend on physician payment methods: What you should know

Jennifer Lubell , Contributing News Writer

The share of physicians who get most of their compensation from salary and some from bonus payments increased by 9 percentage points over the past 10 years, reflecting an ongoing shift away from a single source of payment. While a growing majority of physicians received at least some income based on their personal productivity, it has become less prominent in physicians’ income stream.

Your Powerful Ally

The AMA helps physicians build a better future for medicine, advocating in the courts and on the Hill to remove obstacles to patient care and confront today’s greatest health crises.

Salary remains the largest share of income for physicians, yet bonuses are increasingly factoring into compensation, according to a newly released AMA Policy Research Perspective report (PDF).

A shift from physician practice ownership to physician employment can partly explain this trend, although it’s also happening independently due to a rising share of owners who are getting salaries.

In 2022, 68.2% of physicians received at least some compensation from salary, up from 60.2% in 2012, Sole compensation by salary has dropped slightly, however, as more doctors receive a combination of salary and bonus. Looking at this another way, 39% of physicians were compensated by a single method in 2022, compared with 51.8% in 2012.

The survey is administered every two years, summarizing how physicians get paid. Rama used data from the 2012–2022 AMA Physician Practice Benchmark Surveys to summarize trends and patterns in physician compensation across practice arrangements for 2022. The findings reflect data from 3,500 doctors.

Nearly 60% of physicians reported that more than half of their income came from salary in 2022, compared with 51% in 2012. On average, salary accounted for 55% of compensation for physicians in 2022, up from 50.1% from 2014.

“This was driven by physicians increasingly being compensated by a combination of salary and bonus,” the report says. “The physician population shifting away from ownership and towards employment has impacted the increasing reliance on salary since physician owners are less likely than physician employees to be salaried.”

The share of physicians receiving a bonus rose from 27.1% to 38.2% over the last decade, an 11-percentage-point increase.

“This significant, increasing prevalence of salary and bonus as compensation methods may reflect both practices increasingly choosing to utilize these methods as well as shifts in the physician population,” the report says. More physicians are choosing employment over owning their practices, a trend that rose by 8 percentage points from 2012 to 2022. Physician employees are more likely to receive both a salary and a bonus.

Personal productivity factored into the compensation of 55.5% of physicians in 2022, up from 50.5% in 2012. However, the average share of compensation based on this method declined from 32.6% in 2014 to 29.6% in 2022.

“This is because personal productivity is increasingly being used in combination with other methods and is less likely to be the main component of physician compensation,” Rama said.

Learn more with the AMA about understanding physician employment contracts.

Looking at things by specialty, most physicians receive more than half of compensation from salary (ranging from 54.3% of anesthesiologists to 70.6% of pediatricians).

The plurality of physicians across all specialties received more than half—but not all—of their compensation from salary and some from bonuses. The exceptions were psychiatrists, more of whom got all their income from salary, and surgical subspecialists, more of whom received all their income from personal productivity. Some institutions are more likely than others to pay their employees a salary.

Only 59.8% of physicians in single-specialty practices and 67.9% in multispecialty practices got some compensation from salary, compared with 89.1% of physicians working in hospitals or 86.4% of physicians in other practice types.

Physicians in single and multispecialty practices were more likely than physicians in hospitals or other practice types to get at least some compensation based on their personal productivity. They were also 5–15 percentage points more likely to receive compensation based on the practice’s financial performance.

Across all practice types, just over 40% of physicians have a bonus as part of their compensation. Physicians in single specialty practices had slightly lower rates, at 34.7%.