MGMA: Docs ‘Defy Gravity’ of Inflation, Staff Shortages by Working Harder

Though practice costs for labor and medical equipment have been rising rapidly with inflation, clinicians saw an increase in compensation last year, not because they’re being paid higher rates but because they are “defying gravity,” working harder, longer, and more efficiently to take care of greater post-pandemic patient demand.

That’s according to research released Tuesday from the Medical Group Management Association (MGMA), which published results of its survey of 211,000 physicians, nurse practitioners, and physician assistants from large and small medical groups for 2023.

“Despite being faced with escalating overhead, declining physician reimbursement, and a challenging labor market, medical groups pushed themselves to elevated levels of productivity in 2023, ensuring they could meet the increased demand for care in their communities,” said Halee Fischer-Wright, MD, president and CEO of the MGMA, in a press release.

“As physician and other staffing shortages persist, medical group leaders should embrace the latest digital technologies to assist in optimizing operations, maintaining access to care, and recognizing meaningful cost savings,” she added.

Andrew Swanson, MGMA’s senior vice president of product strategy and sales, told MedPage Today that since the COVID-19 pandemic, practices have found ways “to be more productive by seeing more patients in the day.” They’re increasing relative value unit (RVU) work productivity by opening at 7 a.m. instead of 9 a.m. and staying open until 6 p.m. instead of 4:30 p.m. Many now offer Saturday hours. They’re using telehealth more often, a strategy that allows a physician to see two or three more patients in a day.

Of course, seeing more patients also requires more staff time, Swanson noted, “but they’re using less of that because they’re optimizing technology by streamlining the EHR [electronic health record],” using Apple’s Siri for voice-over dictation, and using electronic systems to schedule patients and remind them of their appointments. In addition, some practices know which patients are more likely to cancel their appointments, and they will double-book patients in those time slots, he said.

A section of the report entitled “Defying Gravity: Entering An Era of Increased Productivity,” acknowledged that “while some practices are experiencing serious problems, many medical groups are managing to ‘keep their heads above water’ and some are thriving.”

Those creative strategies have increased practice compensation for the fourth consecutive year for primary care physicians and non-surgical specialists, as well as for advanced practice providers, the report noted.

Survey Findings

Gains in total median compensation from 2022 to 2023 were 4.44% for primary care physicians and 4.42% for surgical specialists, the latter nearly 2 percentage points higher than the 2.54% growth from 2021 to 2022. Non-surgical specialists saw a 1.81% increase in 2023 after a 2.36% increase the prior year.

The report pointed out that “providers’ gains kept pace with inflation, exceeding the 3.4% change in 2023 in the Consumer Price Index (CPI). However, these providers’ compensation shifts lag the 5-year CPI surge of 22%.”

For advanced practice providers, total median compensation increased 6.47% in 2023, an even bigger gain than the 3.7% increase from 2021 to 2022.

The report also lists compensation changes over the 5-year period from 2019 to 2023 for 23 specialty providers. Dermatologists (10.18%), neurosurgeons (10.05%), and orthopedic surgeons (8.77%) had the highest 1-year increases.

For RVU workload from 2022 to 2023, invasive cardiologists (16.25%) had the highest percentage increase, followed by neurosurgeons (12.50%) and orthopedic surgeons (11.44%).

Comparing 2023 with 2019, non-obstetric family medicine providers saw the highest compensation increase (16.92%), followed by hematology/oncology providers (15.57%) and dermatologists (14.55%).

For RVU workload over that 5 years, hematology/oncology providers had the biggest increase (20.45%), followed by non-obstetric family medicine doctors (19.19%) and invasive cardiologists (19.02%).

The percentages reflect basic increases in income, and do not include inflation, Swanson said.

He noted that some of the gains may be attributed to an increase in demand for certain services associated with an aging population, such as hip and knee replacements.

Looking at highest and lowest compensations by state in 2023, Mississippi had the highest compensation and Alaska had the lowest for both primary care physicians and non-surgical specialists, a difference of $252,379 and $508,468 between highest and lowest paying states, respectively.

For surgical specialists, South Carolina earned the most, while Wyoming earned the least, a difference of $504,277. And for advanced practice providers, those in Nevada earned the most, while those in the District of Columbia earned the least, a difference of $67,118.

Quality Metrics

Half of the survey respondents said quality metrics helped to determine their compensation, while the other half said quality scores did not have an impact.

“This latest poll signals the continuation of an almost predictably slow and steady incorporation of quality into compensation models amid a similarly glacial trend away from fee for service and toward value-based arrangements,” the report stated. Several respondents who said they were not affected by quality metrics noted that while they were tracking them, they didn’t use them to determine compensation, “either due to lack of buy-in or concerns about transitioning during a period of ‘unstable workforce.'” Some said it wouldn’t matter because physician-owners split profits evenly.

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