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Physician pay is rising as productivity increases
Photo: Thomas Barwick/Getty Images
Physician pay has increased year over year due to increased productivity and the use of AI, according to a new MGMA Report.
Physicians are being pushed toward higher productivity than during the COVID-19 pandemic recovery years of 2021 and 2022 as providers continue to recover from economic and staffing challenges, the report states.
Primary care, surgical specialty, and nonsurgical specialty physicians in independent practices reported higher median work relative value units (work RVUs) in 2023 versus 2022.
In hospital practices, the average work RVUs increased in 2023 for physicians in primary care and surgical specialties and for advanced practice providers.
Provider compensation increased for the fourth consecutive year among primary care and non-surgical specialty physicians.
The biggest gains in total average compensation went to primary care doctors (4.44%) and surgical specialists (4.42%), with non-surgical specialist doctors recording a 1.81% increase in 2023.
Gains in primary care and specialists managed to keep up with the 3.4% increase in the Consumer Price Index last year, although five-year changes in physician pay across all types of specialties – which date back to benchmarks pre-pandemic in 2019 – lag behind the nearly 21% increase in the CPI over the same period, the report said.
For advanced practice providers, average total compensation surpassed the gains seen for physicians, with a 6.47% increase in 2023, contributing to a 16.23% gain from 2019 pre-pandemic levels.
WHY DOES IT MATTER
Practices have limited ability to increase payment. O American Medical Association called government-set physician payment rates “unsustainable”.
A MGMA Data Mining Report March suggests that doctors can increase productivity by hiring additional staff, but this also increases indirect costs.
Productivity, as the report released on May 28 shows, is increasing, despite staffing levels remaining essentially constant. This comes at a time when doctors are also facing increasing demand for services from patients.
“It appears that practices are finding other ways to defy gravity and improve overall financial performance,” the report states.
A growing share of medical group executives point to financial and revenue cycle improvements as their primary focus in 2024. Faced with years of hiring difficulties in a tight job market, MGMA members largely report that they see the use of new technologies, including artificial intelligence, as essential.
Technological innovations are slowly being implemented across the healthcare sector to ease the administrative burden on doctors.
THE BIGGEST TREND
The 2024 MGMA DataDive Provider Compensation Survey Report reflects 2023 data from more than 211,000 physicians and advanced practice providers.
ON REGISTRATION
“Although we face rising expenses, the decline of physician reimbursementand a challenging job market, medical groups achieved high levels of productivity in 2023, ensuring they could meet the growing demand for care in their communities,” said Dr. Halee Fischer-Wright, president and CEO of MGMA. “As a physician and other staffing shortages persist, medical group leaders must embrace the latest digital technologies to help optimize operationsmaintaining access to care and recognizing significant cost savings.”
Send an email to the writer: SMorse@himss.org