Primary care compensation increased 6.1% from 2021 to 2022
Click Here to Manage Email Alerts
Key takeaways:
- Primary care had a greater increase in compensation than medical and surgical specialties.
- The highest compensation increase was among primary care physicians in the South and West.
Primary care compensation rose significantly over 2021 to 2022, according to an American Medical Group Association survey, although the data indicate that medical groups’ collections increased more than overall physician compensation.
“We’re seeing that the compensation levels for primary care have increased this past year, greater than in other specialty types, which in our opinion, is evidence that the E/M coding changes that CMS put into effect in 2021 are now being reflected in organizations’ compensation plans,” Elizabeth Siemsen, American Medical Group Association’s (AMGA’s) consulting director, said in a press release.
AGMA’s 2023 Medical Group Compensation and Productivity Survey include data on more than 190 specialties. The results showed that primary care compensation increased by 6.1% compared with 1.5% for medical specialties and 1.6% for surgical specialties.
Primary care also had a greater increase in work relative value units (wRVUs), which was 4% vs. 1.7% for medical and 1.4% surgical specialties, as well as compensation per wRVU, which increased 1.5% for primary care compared with no increase and a –0.2% decline, respectively.
“Survey results indicate that the gains for primary care are evident as the smoke clears from the slow transition to the utilization of new wRVU weights for compensation calculation and the volume swings of the pandemic,” Siemsen said.
Among primary care subspecialties, internal medicine had the highest increase in compensation at 6.4%, followed by family medicine (6.1%) and pediatrics and adolescent medicine (5%). However, pediatrics and adolescent medicine had a higher increase in wRVUs (8.9%) compared with family medicine (3.4%) and internal medicine (1.8%). Meanwhile, family medicine and internal medicine had increases of 2.6% and 1.6% for compensation per wRVUs, whereas pediatrics and adolescent medicine experienced a decrease of –1.2%.
When broken down by region, primary care physicians located in the South (8.8%) and West (8%) had the greatest compensation increases, whereas PCPs in the East had the highest compensation per wRVU (5.3%).
Nurse practitioners and physician assistants in primary care also saw increases of 6.1% and 7% in compensation, respectively.
AMGA’s survey additionally reported that medical groups’ median net collection rose by 5.2%, which was more than the increase in overall physician compensation.
“It is clear from the data that revenue gains are not going directly to physician compensation. A lower compensation-to-collections ratio suggests that a higher percentage of revenue is going to cover all the expenses that have seen an increase in the past few years,” Fred Horton, MHA, AMGA’s consulting president, said in the release. “These include staff expense, supply expense and the like.”
Horton said the finding “reflects that organizations are focusing on the management of the changing financial demands for medical group operations.”
Perspective
Back to Top
Primary care has been underfunded in the U.S. for decades. We spend only about 5% to 7% of our total health care dollars on primary care despite the fact that primary care is responsible for almost half of all office visits each year and influences up to 90% of health care costs. In addition, primary care is the only specialty whose utilization has shown to be associated with decreased health expenditures, higher patient satisfaction, fewer hospitalizations and ED visits and lower overall mortality. Most every other western industrialized nation spends about twice as much on primary care as we do in the U.S.
So, it’s really encouraging, as someone who was involved in the reevaluation of the E/M values, to see primary care finally making some small gains in compensation. I don’t think it solves the problem of primary care in this country, but it’s a start.
There was a study published earlier this year in JAMA that modeled these E/M changes and the wRVU increase. The study had similar findings in that the payment rates for primary care increased by 9% to 11%. But because many proceduralists also use E/M codes, the pay gap between primary care and specialty care didn’t change as much as in the AMGA report.
An additional point to keep in mind is that academic centers didn’t necessarily update physicians’ salaries to reflect updates in the E/M RVUs. I think that’s important to know, because despite the increase in the E/M RVUs, a lot of physicians did not get to see the benefits of that.
There was a section of this study that medical groups’ revenues increased faster than the compensation gains for physicians, and that suggests that physicians are dealing with a lot of headwinds like the significant inflation rates, increased overhead and the increased cost of everything that physicians need to do to run their practices like hire nurses, staff and pay for equipment.
If you look at the big picture, this is an increase, yes. But it’s a relatively modest increase when you compare it to the fact that essentially, physician payments have been flat for about 20 years. We’re not there yet, but it is a nice start that we can build on.
Collapse
Read more about
Click Here to Manage Email Alerts