HOSPITALISTS HAVE GROWN used to continual and dramatic pay raises. A decade ago, for instance, mean hospitalist compensation hovered around $200,000, while today it’s pushing $300,000 and beyond.
But there are signs that the rapid rise in hospitalist compensation may be slackening off. This year’s Today’s Hospitalist Compensation & Career Survey identified a slight decline in the mean income that hospitalists earned in 2018 compared to the previous year.
Full-time hospitalists treating adults reported a mean total compensation, including all bonuses and incentives other than benefits, of $285,569. While that national average may mask vast differences across markets and employer types, it nonetheless represents a 1.6% drop from the mean compensation reported in last year’s survey ($290,089).
“2019 feels very different, like we’re in a really constrained environment.”
~ Kimberly Bell, MD,MMM
A one-year reduction—and a small one, at that—may be only a blip. Still, many hospitalist leaders say they aren’t surprised to see that compensation increases may be leveling off, in at least in some markets.
After all, it’s no secret that many hospitals and health systems are experiencing financial difficulties, and there’s a sense that revenues and expenditures are less predictable than ever. What will happen with Medicare and Medicaid reimbursement, for instance, or balance billing and collections? How about drug pricing and the ongoing viability of the Affordable Care Act?
“2019 feels very different, like we’re in a really constrained environment,” says Kimberly Bell, MD, MMM, regional medical director at TeamHealth West, Seattle.
“The margins at hospitals are pretty thin, and everyone is thinking about what are we going to do financially to survive,” Dr. Bell adds. “Anything that is a big line item on the budget is going to be looked at, and physician comp typically is such a line item.”
At the same time, California-based hospital medicine consultant Leslie Flores, MHA, points out that there is little evidence that hospitalist compensation is falling victim to hospital cost-cutting. Survey data published as recently as last year by Today’s Hospitalist and the Society of Hospital Medicine showed hospitalist compensation on the rise.But “hospitals and health systems now may be much more reluctant to just increase compensation routinely every year,” Ms. Flores says. “In the past, that was fairly common.”
Where comp is rising, languishing
While the national average in this year’s Today’s Hospitalist survey may reflect sluggishness, physicians in specific regions and settings continue to report rising pay. Hospitalists in the Midwest, for instance, reported a 5.6% compensation hike, hitting a mean of $302,056.
“Hospitals and health systems now may be much more reluctant to just increase compensation routinely every year.”
~ Leslie Flores, MHA
Nelson Flores Hospital Medicine Consultants
Consultants chalk that healthy increase up to supply and demand. They say that programs in middle America continue to need to pay top dollar to convince hospitalists to take jobs in places that are far from the coasts or international airports, or where the weather is notoriously bad.
In Columbus, Ohio, Stephen Behnke MD, MBA, CEO of MedOne Hospital Physicians, a private local group, points out that his market isn’t seeing any flattening of compensation. “I think it’s primarily because we don’t have supply-demand equilibrium,” he says.
On one hand, Dr. Behnke points out, “the dramatic rise of hospitalist comp over the last 20 years can’t go on in perpetuity.” But on the other hand, all the hospitals in his area recently raised their salaries, provoking something “like an arms race.”
Now, hospitalists earning more than $300,000 is “common in our market.” “You have to raise comp to keep pace,” he adds. “If you don’t, you will not have hospitalists in three to five years.” By contrast, mean compensation in the Northeast continues to lag, growing by only 1% (to $268,259) in this year’s survey.
In suburban Philadelphia, Chris Pomrink, DO, medical director for medical specialties at Virtua Medical Group in Marlton, N.J., describes “an increased number of hospitalists in the market right now”—one exacerbated by hospital closures and mergers in the region. To recruit and retain hospitalists, he says that groups like his now emphasize factors like workload, culture and flexibility.”
What we are hearing is that physicians are looking for fair compensation, but a culture in which they are treated fairly is equally important,” Dr. Pomrink says. “Of course, we monitor compensation closely because we want to remain competitive. But people don’t leave our program for more money down the street.”
Supply catching up with demand
A founding partner of Nelson Flores Hospital Medicine Consultants, Ms. Flores points out that last year’s SHM survey also indicated that supply and demand had equalized in some markets. Fully one-third of the hospitalist groups included in that survey reported being fully staffed.
“You have to raise comp to keep pace. If you don’t, you will not have hospitalists in three to five years.”
~ Stephen Behnke, MD, MBA
MedOne Hospital Physicians
“That’s a lot more practices than I suspect was the case five years ago,” she says.
In parts of the South, for instance, supply has caught up with demand. In this year’s Today’s Hospitalist survey, the mean compensation in the South—$292,333—represented a 2.3% decline over the previous year’s.
“We have seen a lot of people move to the South. There is a high supply of people who want better weather and lifestyle,” says Ryan A. Brown, MD, specialty medical director, hospital medicine at Atrium Health and the Carolinas Hospitalist Group.
Particularly around the Charlotte, N.C., area where he is based, Dr. Brown says that employers now compete for hospitalists as much by promising sustainable work models as by offering high compensation. Top dollars are not the only draw, just one of them.
“We have allowed people in our group to achieve a better work-life balance with different schedules, a sabbatical policy, a program where people can reduce their FTE status, and the addition of advanced practice providers (APPs) and a virtual care telemedicine program,” Dr. Brown says. “More people are saying, ‘I don’t want to necessarily work as much as I did in the past. I will have a lower salary, and that’s OK.’ ”
He believes that trend is fueled in part by the fact that the amount of non-RVU-producing work that hospitalists now have to do, from documentation to discharge planning, is on the rise. Many hospitalists feel they are working harder even if their actual “productivity”—as measured by work RVUs—doesn’t reflect that. (MGMA data indicate that hospitalist RVUs have been hovering around 4,200 for a couple of years.)
As a corollary to some hospitalists choosing to moderate the hours they put in, “you also have plenty of young doctors who want all those extra moonlighting shifts,” Dr. Brown points out. A compensation survey’s use of averages may be flattening these highs and lows, which could make overall compensation somewhat flat.
Are bonus targets harder to hit?
TeamHealth’s Dr. Bell is also seeing markets where the supply-demand pressure is easing. That’s due in part, she notes, to having more advanced practice clinicians (APCs) in the field. Also, more programs can avail themselves of other alternatives to boots-on-the-ground physician labor, such as telemedicine.
“People don’t leave our program for more money down the street.”
~ Chris Pomrink, DO
Virtua Medical Group
“We have a practice that we staff with doctors during the day and APCs overnight,” Dr. Bell says. Before APCs came on board, “the doctors would take night call and that would be part of their income. Now that we have APCs, we don’t need the docs to cover those nights.” In addition, practices used to pay premium shift differentials to convince hospitalists to cover otherwise unfilled hours.
“I think the more we have a better workforce supply— APCs or even a telemedicine alternative—we might not need to pay these shift differentials,” says Dr. Bell. That, she speculates, may already be affecting the amount of extra income hospitalists in some places report earning.
Earning less in bonuses and incentives may also play a part. This year, hospitalists reported that bonuses and incentives added an average of $36,477 to their base salaries. That’s $5,478 less than the $41,955 they reported in bonuses and incentives in last year’s survey, a 13% drop.
It used to be relatively easy for hospitalists in many programs to collect 100% of incentives being offered, says Ms. Flores.
“When people instituted quality- or performance-based components to their comp plan in the past, they may have started out with pretty low-hanging fruit,” she notes. “There may be more money available now in a bonus pool, but physicians will end up getting only 50% of it.” That’s because expectations, thresholds and targets have all gone up.
Dr. Brown agrees. “Many of the quality metrics that people are using now are actually more challenging,” he says. “Even though hospitalists are being paid similar or higher base salaries, total compensation may go down from smaller realization of incentives.”
“More people are saying, ‘I don’t want to necessarily work as much as I did in the past. I will have a lower salary, and that’s OK.’ “
~ Ryan A. Brown, MD
In addition, hospitalists now may have to compete with their colleagues for those additional dollars. To collect a bonus, hospitalists don’t just need to hit a target; they need to hit a target that has been moved further away, and they need to hit it faster and better than others.
Consider incentive payments for improving patient satisfaction. In general, Dr. Brown says, patient experience has gotten better across the board. “So even if your patient satisfaction scores are up, if others have improved more, you may not get the bonus.” When groups have four quality goals that could together add up to $20,000 a year in bonuses, “losing one or two goals may mean $5,000 or $10,000 less. That might explain why compensation looks flat rather than increasing.”
“A flattening over time”
The fact that hospitals are challenging hospitalists to have a portion of their compensation linked to quality is a response to the pressures on health systems today, says Catherine Raver, MD, director of the hospitalist program at Baylor Scott & White Medicine-Dallas.
“Hospital margins are getting tighter and tighter,” she notes. “The costs of supplies and staff aren’t going down, and reimbursements certainly aren’t keeping pace.” While she expects “a flattening over time,” Dr. Raver says she doesn’t see any evidence in her market of depressed hospitalist compensation. Instead, the market—and region— both continue to grow and to need hospitalists.
Nationally, however, she isn’t surprised that compensation may be leveling out. Everything going on in Washington and with payers “will certainly not drive salaries up,” Dr. Raver adds. “I’m pretty confident about that. The question is, will they drive them down?”
“When there is a lot of turnover, which there used to be, that drives up compensation.”
~ Catherine Raver, MD
Baylor Scott & White Medicine-Dallas
And while her health system is involved in a number of pay-for-performance programs including bundled payments, “it’s too early,” she says, to know what impact those might have on hospitalist compensation. “There’s potential for the future, but it’s a long-term game for sure.”
Although she thinks economic pressures on hospitals are clearly a factor, Dr. Raver also believes that compensation may be stabilizing because the now 20+-year profession is itself maturing. As a result, fewer groups are experiencing staff churn.
“When there is a lot of turnover, which there used to be, that drives up compensation,” Dr. Raver says. “Now that we’ve figured out what’s a sustainable workload, people are staying for 20 or 30 years, and turnover is pretty low.”
Deborah Gesensway is a freelance writer who covers U.S. health care from Toronto.
WHO EARNED THE MOST in hospital medicine in 2018? The biggest earners can be found in the Midwest, working in smaller hospitals, doing some group or hospital management in addition to covering clinical shifts, and choosing a long-term career in in hospital medicine.
That’s in part because of this recent change: Some hospitalist groups are compensating their physicians to recognize seniority.
This year’s Today’s Hospitalist survey found that hospitalists who have worked five years or more are earning north of $300,000. And hospitalists in their 50s reported a mean total compensation of $317,454.
“This has been a clear trend over the last five years or so,” says Leslie Flores, MHA, founding partner of Nelson Flores Hospital Medicine Consultants, a national consulting firm. “An increasing proportion of groups have some sort of pay scale for experience or years of service.”
Program directors are also high earners, reporting a mean compensation of $339,071, while hospitalists who say their jobs include some “group management” or “hospital leadership” report earning close to $317,000. The same is true for the small number of hospitalists who do informatics in addition to patient care.
Not surprisingly, hospitalists who attend in ICUs also reported higher mean compensation: $303,639. According to Ms. Flores, that likely reflects the fact that hospitalists working in smaller hospitals (those with fewer than 250 beds) report higher mean compensation than most. Smaller and more rural hospitals tend to be the ones with open ICUs.
Also not a surprise: Hospitalists who earn more than $300,000 report the most satisfaction with both their specific jobs and their hospitalist career.
Women in hospital medicine continue to report lower average compensation than their male colleagues. The 2019 Today’s Hospitalist Compensation & Career survey finds a sizeable gap in leadership pay. When asked about their program director stipend, the men who are directors reported a figure nearly twice that of women’s: $51,441 vs. $27,619.
And women who work full-time treating adults earn on average $262,193 vs. the $293,551 cited by men. That 11% difference is at least smaller than last year’s 17% pay gap.
The 2019 Today’s Hospitalist Compensation & Career did highlight some variations in where, how, and how much women and men hospitalists work. Women hospitalists, for instance, derive less of their total income from working extra shifts (6.3% vs.10.5%). They also reported earning less in bonuses and incentives than their male colleagues: $26,585 vs. $39,247. And among hospitalists eligible for bonus or incentive pay, 7.4% of women respondents said they earned nothing in 2018 compared to only 1% of their male counterparts.
There’s some encouraging news on the pay gap: An analysis of Today’s Hospitalist survey results over the years shows that it is shrinking. Since 2015, women’s self-reported compensation has increased $28,086 or nearly 12%, while men’s has gone up by 8%, or $22,020.
This year’s survey also showed that women and men have different perceptions of their work environments. A greater proportion of women than men (46.5% vs. 19.6%), for instance, said their “opinion has been inappropriately questioned by colleagues” and that they have been “asked to do menial tasks not expected of colleagues” (20.8% vs. 12.2%). In addition, 35.6% of women cited a lack of career advancement or training, a problem for only 26.3% of the men who responded.
At the same time, a greater proportion of men than women reported being “asked to see more patients than colleagues” (36.5% vs. 19.8%) and “asked to work more hours than colleagues” (35.7% vs. 18.8%). Among women, 25.7% reported being “asked to work less hours than colleagues,” an issue for only 3.5% of men.
Published in the November 2019 issue of Today’s Hospitalist