Doctors’ Income: 8.6% Of Health-Care Costs

Whatever is driving up health-care costs, it’s not physicians’ salaries.

So says Jackson Healthcare, an Atlanta-based medical staffing and technology company that conducts periodic physician polls and other research. Using statistics from the Centers for Medicare and Medicaid Services, the Medical Group Management Association (MGMA), and the American Medical Association, Jackson Healthcare estimates that in 2009, physician compensation accounted for $216 billion of the total $2.5 trillion in U.S. health-care spending, or 8.6 percent.

Richard Jackson, chairman and chief executive officer of Jackson Healthcare, put it this way:

At 8 percent of total health-care costs, if physicians worked for free, we would still have a serious cost problem. What this figure shows is that physician pay is not the primary contributor to health-care costs.

Not that anybody really said it was.

Jackson Healthcare also conducted a Web-based national survey of 1,512 physicians in April regarding the sources of that physician income. It found that 36 percent reported only fixed income—a salary or other remuneration that does not vary according to productivity or compensation for such extra services as ordering lab services or diagnostic imaging.

Other findings:

• 82 percent reported receiving no compensation for generating prescriptions, lab tests, hospital admissions, facility/surgery fees, or diagnostic imaging.
• 12 percent reported variable compensation based on productivity.
• 8 percent reported variable compensation from practice ownership.
• 2.3 percent reported variable compensation from ordering diagnostic imaging.

And while we’re on the subject of income: the MGMA has released its awkwardly named Physician Placement Starting Salary Survey 2011 Report Based on 2010 Data. Overall, specialists in multispecialty practices received an average of $258,677 in first-year guaranteed compensation, compared with $240,596 in first-year guaranteed compensation for those in single-specialty practices.

For primary care physicians, it was the other way around: $172,400 for those in single-specialty practices compared with $165,000 for those in multispecialty practices.

The data were collected from 4,295 providers, 1,986 of whom were directly out of a residency or fellowship. For diagnostic radiologists in their first year of practice, median compensation was $400,000 if they did invasive procedures, $350,000 if not. For diagnostic radiologists in their first year after residency or a fellowship, the comparable numbers were $350,000 and $288,000.