Average Physician Compensation Increase Was 3.8% in 2009: AMGA Survey

Most specialties saw modest increases in compensation in 2009, but many provider organizations continue to operate at a significant loss, according to findings in the American Medical Group Association’s (AMGA’s) 2010 Medical Group Compensation and Financial Survey. The survey found that 76% of the specialties experienced increases in compensation in 2009, with the overall average increase around 3.8% (in 2008, when 81% experienced an average increase around 3.5%). The primary care specialties (excluding hospitalists) saw about a 3.8% increase in 2009 (same in 2008), while other medical specialties averaged an increase of 2.4% and surgical specialties averaged around 3.8%. The primary care specialties saw about a 3.8% increase in 2008, while other medical and surgical specialties averaged 6%. The survey reports that during 2009, the specialties experiencing the largest increases in compensation were pulmonary disease (10.37%), dermatology (7%), and urology (6.36%).

The section of the survey that examines financial operations found that medical groups were still faced with significant financial challenges. Most regions were doing better than in 2008, but margins are thin. In 2009, organizations in the Eastern and Western regions were operating at break even. Organizations in the Southern region continue to operate at a loss (-$1,034 per physician in 2009, -$120 per physician in 2008). Groups in the Northern region continued to experience significant losses (-$9,943 per physician in 2009, -$3,254 per physician in 2008).

The Most Important Bill of 2009 for Anesthesia Providers

The U.S. House of Representatives will soon consider H.R. 3961, the “Medicare Physician Payment Reform Act of 2009.”  This important legislation would permanently repeal the unworkable Sustainable Growth Rate formula (SGR) and create a path for future positive updates. Without SGR reform this year, anesthesiologists and all other physicians face a 21 in Medicare payment cut beginning Jan. 1, 2010, with additional cuts projected in future years.  H.R. 3961 would eliminate such SGR reductions to Medicare physician payments.

Instead, H.R. 3961 would create a new physician payment formula with two buckets that would:

  • Allow the volume of most services to grow at the rate of GDP plus 1 percentage point per year
  • Allow the volume of primary and preventive care services to grow at GDP plus 2 percent per year

The bill would also remove drugs and laboratory services not paid directly to practitioners from spending targets.  The Medicare update for 2010 would be set at MEI. Leadership has indicated that the U.S. House of Representatives will vote next week on H.R. 3961.  Now is the time to call and make sure your representatives will vote yes on H.R. 3961.