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Primary Care Docs Average More Hospital Revenue Than Specialists

John Commins, for HealthLeaders Media, May 20, 2013

A survey of hospital CFOs shows primary care physicians generated a combined average of $1,566,165 for their affiliated hospitals in the last year. Other specialties generated a combined annual average of $1,424,917, the lowest average in five years, data shows.

Primary care physicians have emerged as key money makers for their affiliated hospitals and for the first time are generating more revenues on average than their specialist colleagues, a survey data from Merritt Hawkins (PDF) shows.

"For the first time in the survey's history we have primary care overtaking specialties on an average basis," says Travis Singleton, a senior vice president at the Irving, TX-based physician recruiting firm. "I was pleasantly surprised to see the survey show that. We knew it was happening, but we didn't know if the market had shown that yet."

The survey asked hospital chief financial officers to quantify how much revenue physicians in 18 specialties generated for their hospitals in the last 12 months, including net inpatient and outpatient revenue from patient referrals, tests, prescriptions, and procedures performed or ordered in the hospital.

Primary care physicians—family physicians, general internists, and pediatricians—generated a combined average of $1,566,165 for their affiliated hospitals in the last year. The remaining 15 specialties included in the survey generated a combined annual average of $1,424,917, the lowest average in the five years the survey has been conducted, the data showed.

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4 comments on "Primary Care Docs Average More Hospital Revenue Than Specialists"


RB (5/21/2013 at 12:49 PM)
Misleading conclusions, I agree. One conclusion I drew without knowing more facts than published in this article is that primary care doctors order more tests compared to specialists who perhaps practice more cost-efficient medicine. I'm a cardiologist and once, in a past life employed at a local hospital, I was told during my review that I didn't order enough echoes (based on what they expected when they hired me). Not every heart problem requires an echo to diagnose or treat.

Mary O'Brien (5/20/2013 at 3:04 PM)
"We recognize that the majority of this bump is because more of their physicians are employed now so there is greater control," he says. "These health systems have formulated these vast employee networks and it is no secret that an employed physician is going to be much more apt and even directed in some cases to push a lab or a test or a procedure or a referral down the hall and not down the street. They aren't going to send it to an independent imaging group or an independent lab like they used to. In essence that is not really creating new money. That is just pulling that money within the hospital walls." This comment also raises the issue that all these ancillary services being driven into the hospital setting by employed physicians will increase the cost of health care . The same service performed in the outpatient settings of independant providers are in most cases much more cost effective than when performed in the hospital setting.

P.Yadav (5/20/2013 at 2:16 PM)
Acquisition of small practices by bigger hospitals is the norm leaving the combined revenue unquestionably greater. It is important to point out that it takes a lot (time,energy,capital,risk)to establish a specialty clinic/practice hence, fewer available for acquisition. Most specialists like to work as employees from the beginning of their career. The difference in revenue may have to do more with market forces playing out than the so mentioned automatic shift of power towards PCPs in healthcare. I agree with the comment above- Several questions are left unanswered like how the revenue was calculated, did it include the referral cut for in hospital PCPs?