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Physicians Generate $1.5M Annually for Their Hospitals, Says Survey

John Commins, for HealthLeaders Media, March 17, 2010

Physicians are key drivers of hospital revenues, and a single physician averages more than $1.5 million a year in net revenue for his or her affiliated hospital, a new national survey of hospital CFOs reported.

The survey by Irving, TX-based physician recruiters Merritt Hawkins asked CFOs in 114 U.S. hospitals to quantify how much revenue physicians in 17 specialties generated for their hospitals in the last 12 months, including net inpatient and outpatient revenue derived from patient referrals, tests, and procedures performed in the hospital.

Neurosurgeons topped the list. A single, full-time neurosurgeon generates an average of more than $2.8 million a year on behalf of the affiliated hospital. Other high revenue generating specialists include invasive cardiologists ($2.2 million), orthopedic surgeons ($2.1 million), general surgeons ($2.1 million), and hematologists/oncologists ($1.5 million), the survey showed.

Primary care physicians also generate substantial revenues for hospitals. A general internist brings in nearly $1.7 million a year on average for the affiliated hospital, a family physician more than $1.6 million, and a pediatrician more than $856,000, the survey showed.

Merritt Hawkins President Mark Smith said the survey demonstrates the central role that physicians play in the healthcare delivery system.

"The most powerful tool in healthcare remains the physician's pen," Smith said in a media release. "Patients are not admitted to the hospital or discharged, tests ordered, or procedures performed without a physician's signature. Hospitals depend on doctors to drive patient care, which in turns drives revenue."

Merritt Hawkins last conducted the survey in 2007, when the average annual revenue generated per physician across all specialties was nearly $1.5 million, slightly lower than the 2010 average. Smith said the revenue increase during a recession suggests that physicians continue to provide a high level of hospital-based services.

"Both the recession and declining reimbursement have prompted many physicians to seek closer relations with hospitals," Smith said. "More physicians are employed by hospitals today than they have been in the past and the interests of the two parties are more closely aligned."


John Commins is a senior editor with HealthLeaders Media.