More than half of medical groups report that workforce shortages are the biggest barrier to productivity growth.
Physician compensation has not kept pace with inflation, according to a Medical Group Management Association report based on 2022 data.
The 2023 MGMA Provider Compensation and Production report features data collected from nearly 190,000 clinicians at more than 6,800 healthcare organizations. The report provides insights on the evolving financial circumstances for clinicians.
"Despite physician and advanced practice provider (APP) productivity continuing its post-pandemic recovery, compensation gains are being outstripped by the most severe inflationary growth in decades," the report says.
For example, increases in median total compensation for primary care physicians in 2021 (2.13%) and 2022 (4.41%) were far lower than rates of inflation for 2021 (7%) and 2022 (6.5%), according to the report. "Primary care, surgical specialist, and nonsurgical specialist physician compensation all saw modest gains from 2021 to 2022; however, none of these benchmarks rise to the elevated levels of inflation," the report says.
The report has several key findings:
- APPs experience the biggest change in median total compensation from pre-pandemic levels, but growth dipped slightly from 3.98% in 2021 to 3.70% in 2022
- More than half (56%) of medical groups reported that staffing is the biggest barrier to productivity growth
- A November 2022 MGMA poll found varying performance on productivity at medical groups, with 29% reporting that they had exceeded their productivity goals for the year, 36% reporting that they were on target, and 36% reporting that productivity was below expectations
- Physicians with supervisory responsibility over APPs reported earning 7% to 15% more in total compensation than physicians without supervisory responsibilities
- Primary care physicians working night shift hours reported earning $70,000 more than colleagues working the day shift and nearly $23,000 more than colleagues working afternoon-to-evening shifts
- From 2020 to 2022, there was a "steady shift" to salary-based compensation models for clinicians away from production-based compensation models
- MGMA Stat polls found a significant increase in medical groups incorporating quality metrics into their clinician compensation models, with 47% of medical groups linking quality performance metrics to physician compensation in May 2023 and 42% of medical groups linking quality performance metrics to physician compensation in May 2022
- According to an October 2022 MGMA Stat poll, only 28% of medical groups reported adding an ancillary service in the previous year, with many organizations citing labor recruitment difficulties as the barrier
- An April 2023 MGMA Stat poll reflected a trend toward hiring APPs to offset shortages of physicians and nurses, with 65% of medical groups planning to add new APP roles in 2023
- The April 2023 MGMA Stat poll found nearly half (47%) of medical groups had added or created part-time or flexible-schedule physician roles in the past year in response to physician shortages
Jessica Minesinger, an MGMA consultant and founder and CEO of Surgical Compensation & Consulting, made three recommendations for medical groups in the report.
Medical groups need to respond to "rampant" physician burnout, which is decreasing productivity, she said. "Taking a customized, positive, and proactive approach to identifying the causes and finding effective ways to reduce the impact of burnout on your physicians is critical. This includes recognizing the challenges unique to female and male providers. A one-size-fits-all approach won't suffice."
Minesinger identified several components to addressing turnover, disruption to staff, lost revenue and productivity, and recruitment costs, including retention, promotion, staff engagement, and well-being initiatives.
Caring for physicians and other staff members responsible for patient care is critical to financial sustainability, she said. "Establish and invest in leadership roles and departments tasked explicitly with increasing provider recruitment, retention, and well-being. Address the well-documented gender wage gap in medicine and the ongoing challenges female physicians face with openness and transparency. The ultimate goal is to provide the best possible patient care, experience, and outcomes."
The report calls on medical groups to establish retention committees to help ease workforce shortages.
The first step to establishing a retention committee is to create an electronic survey to poll physicians on their feelings about practicing in the medical group, the report says. "The survey should ask physicians: What one or two issues create the highest level of dissatisfaction in practicing with us? What one or two things are responsible for your highest level of satisfaction? What one or two issues would cause you to leave for another opportunity?"
A findings report should be developed from the electronic survey and presented to senior leadership, including CEO, chief operating officer, chief medical officer, chief financial officer, and chief human resources officer. "Discuss all issues, evaluate recommendations, and determine what can be agreed to in this initial meeting. Leave the final report with recommendations for attendees to review on their own, and schedule a second meeting for the following week with expectations that each category will be discussed and addressed," the report says.
Christopher Cheney is the senior clinical care editor at HealthLeaders.
Increases in median total compensation for primary care physicians in 2021 (2.13%) and 2022 (4.41%) were far lower than rates of inflation for 2021 (7%) and 2022 (6.5%), according to the report.
From 2020 to 2022, there was a "steady shift" to salary-based compensation models for clinicians away from production-based compensation models.
An April 2023 MGMA Stat poll reflected a trend toward hiring advanced practice providers to offset shortages of physicians and nurses, with 65% of medical groups planning to add new APP roles in 2023.