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As Physician Compensation Increases, so Does Turnover


Provider organizations are reporting stronger financial performance and slightly higher average compensation increases, according to a report from the American Medical Group Association.

Provider organizations are reporting stronger financial performance and slightly higher average compensation increases, according to the American Medical Group Association’s (AMGA) 2014 Medical Group Compensation and Financial Survey.

On average, groups reported breaking even financially, although those in the eastern part of the country did report positive operating margins. As a result, average compensation increase was 2.9%, up from 1.6% the year prior.

"After years of facing financial hardship, medical groups and other organized systems of care are improving their financial performance," Donald W. Fisher, PhD, CAE, president and chief executive officer of AMGA, said in a statement.

Efforts to provide high-quality, efficient care at low costs are paying off as cost savings translate into stronger finances, according to Fisher.

“This is another example of the superiority of the integrated, coordinated model of care delivery,” he said. “As these medical groups strive to become high-performing health systems, they are investing in improvements in care processes and infrastructure that will provide patients with better health outcomes, enhanced care experience, and lower costs well into the future. It is gratifying to see their efforts are also resulting in financial gains, and we hope they can continue to improve financial performance."

According to respondents, 68% of specialties increased compensation in 2013. While most increases were small — primary care saw an increase of 3.8%, up from 2.8% — gastroenterologists experienced the largest compensation increase at 9%, followed by cardiac/thoracic surgery at 8.2%, and emergency medicine at 5.2%.

A separate AMGA survey, in conjunction with Cejka Search, found physician turnover remained at its highest rate since 2005, the first year data was collected. On average, medical groups reported a turnover rate of 6.8% in 2013, the same as the previous year.

Turnover among advanced practice clinicians, such as physician assistants and nurse practitioners, was at 9.4%, according to the AMGA.

The results indicate that retirement is accelerating among America’s healthcare workforce. This was the top reason cited for separation, jumping to 18% in 2013, which represents a 50% increase over 2012’s reported numbers.

According to Fisher, recruitment and retention continue to be major challenges for healthcare, and medical groups are responding by investing in new staffing models, nurturing their teams, and making accountable care work for their communities.

"Changing demographics and healthcare reform make efficient recruitment more important than ever for medical groups,” John Gramer, president of Cejka Search, said in a statement. “Delivering data and insight helps pave the way for more innovative recruitment and retention solutions in a rapidly changing talent marketplace.”

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