Physician Compensation Grew Across the Board in 2018, MGMA Reports
A new report on physician compensation found primary care and specialty physicians, as well as non-physician providers, saw pay increases from 2017 to 2018.
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By - Average physician compensation for primary care and other medical specialties increased by 3.4 percent and 4.4 percent from 2017 to 2018, respectively, the Medical Group Management Association (MGMA) recently reported.
The findings are from MGMA’s annual Provider Compensation and Production Report, which examines data from more than 147,000 physicians and non-physician providers in over 5,500 organizations.
In addition to immediate physician compensation growth, this year’s report also found that the annual pay for advanced practice providers increased by 2.9 percent in 2018 compared to the previous year, and total compensation among all providers has grown at a rate of seven to 11 percent over the last five years.
“These compensation specifics allow medical practices to remain competitive and informed on the ever-evolving trends that continue to occur in the healthcare industry,” Halee Fischer-Wright, MD, MMM, FAAP, FACMPE, president and CEO at MGMA, stated in a press release. “The increases we are seeing are driven not only by supply and demand but also by an increase in productivity. Practices are staying ahead of the curve by monitoring these trends and in this case, offering higher wages and more incentives to attract and retain the talent they need.”
Demand for providers is dramatically rising due to the physician shortage. The healthcare industry will be short of up to 121,900 physicians by 2032, the Association of American Medical Colleges (AAMC) recently reported in an updated analysis of healthcare’s physician shortage problem.
With the industry facing a “real and significant” physician shortage issue, demand for providers is outpacing supply, AAMC and other industry leaders explain.
As a result, healthcare organizations are increasing compensation rates and offering competitive benefits to attract physicians from the shrinking physician pool, reported MGMA. The association’s most recent physician compensation report found that the median guaranteed compensation for newly-hired providers steadily increased from 2017 to 2018.
Specifically, guaranteed compensation for newly-hired emergency medicine, cardiology, and urology physicians rose 40.43 percent ($207,360 to $291,194), 21.25 percent ($400,000 to $485,000) and 20 percent ($312,500 to $375,000), respectively.
Compensation for non-physician providers also significantly increased during the period, MGMA reported. Physician assistants saw a 10.35 percent boost from 2017 to 2018 and at the same time, nurse practitioners received a four percent increase.
Physician assistants, nurse practitioners, and non-physician providers are stepping in to ensure patients receive care despite the physician shortage.
United Health Group recently emphasized how non-physician, or advanced practice, providers bridge the primary care gap. The group found that 13 percent of patients live in a county with a primary care shortage, and new graduate students have little interest in practicing primary care despite its potential to significantly lower costs and improve outcomes.
Physician assistants and nurse practitioners, on the other hand, have a documented interest in primary care, with 78 percent of NPs practicing primary care in 2018 versus 33 percent of physicians. United Health Group also projected the number of nurse practitioners and physician assistants in primary care to increase by 47 percent and 38 percent, respectively, by 2025.
The increasing role of non-physician providers is driving increases in compensation, research continues to find.
In MGMA’s 2018 DataDive Management and Staff Compensation report, the association reported that the median total compensation for staff in nursing positions increased by 19 percent. The National Commission on Certification of Physician Assistants (NCCPA) also recently found the average salary of a certified physician assistant grew by 15.7 percent in the last six years, reaching over $100,000 by 2018.
Providers across the boards are seeing sizable increases in total compensation, the research shows. And they are likely to continue realizing significant pay increases and more competitive benefits as healthcare organizations explore strategies to attract and retain high-quality providers during the physician shortage.
