ENGLEWOOD, Colo. -- Overall, physicians experienced minor
increases in compensation during 2002, according to the
soon-to-be-released Medical Group Management Association (MGMA)
Physician Compensation and Production Survey: 2003 Report Based on 2002
Data.
Although primary care physicians experienced 2.8 percent median
increases in compensation and specialists reported 4.3 percent median
increases, some notable medical specialties experienced decreases in
compensation.
The MGMA report, the largest of its kind, outlines compensation and
production indicators for almost 40,000 providers in 105 physician
specialties and 30 nonphysician specialties in all 50 states and the
District of Columbia.
According to the MGMA report, several specialties experienced a
decrease in compensation in 2002 for the first time in several years.
Both invasive and noninvasive cardiologists reported lower income. Their
compensation levels declined between 2001 and 2002 by 6.17 percent and
3.9 percent, respectively.
"Multiple factors have contributed to the challenging environment
practices like ours face," said Phyllis Brown, CEO of Arkansas Cardiology
PA in Little Rock. "We've seen a decrease in overall reimbursement for
certain procedures and we're seeing more patients who lack appropriate
insurance. Overall, we've seen an increase in appeals and denials, and
my staff is required to do more paperwork to demonstrate medical
necessity for some procedures. These factors, coupled with our 60
percent increase for malpractice liability premiums, exemplify the
current environment for cardiology practices."
General surgeons also experienced a year-to-year compensation decline
of 0.8 percent; pulmonary medicine experienced a 2.64 percent decline
and urology lost 3 percent of compensation in 2002. Gains in a number of
other specialties were barely in line with general inflation.
Some specialties reported higher productivity while compensation
remained static. For example, urologists showed a 6.29 percent increase
in production as measured by work relative value units (RVUs) but a
decline in income of 3 percent. Gastroenterologists reported an 11.7
percent increase in work RVUs but only a 2.87 percent increase in
income.
"Due to the increase in cost for practice operations, health care
benefits for employees and the escalating cost of malpractice premiums
in most areas, physician practices will find it difficult to maintain
net income without significantly increasing their work schedules and
patient volumes," said Michael Nochomovitz, MD, president and chief
medical officer of University Primary and Specialty Care Practices at
University Hospitals Health System in Cleveland. "In order to sustain
their compensation, many physicians are spending more hours at the
office and seeing more patients."
"The most important factors affecting physician compensation are the
increasing cost of practice operations, especially in labor, drugs and
supplies and malpractice insurance, coupled with cutbacks in both
commercial and government reimbursement," said William F. Jessee, MD,
CMPE, president and CEO of the MGMA. "We expect to see even greater effects due
to increases in professional liability insurance costs in 2003 and the
full effect may not even occur until 2004 and beyond. As costs go up and
revenues decline, physicians find themselves working harder for no more
money. As a result, they increasingly face difficult choices, such as
avoiding high-risk procedures and patients, withdrawing from Medicare
and other insurance programs, or leaving their practices entirely."
Source: MGMA