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Hospitalist compensation increases as demand increases

By Shannon Geis
June 23, 2016
Body of Knowledge Domain(s): Financial Management

Hospitalists working in physician-owned practices are seeing larger compensation increases than those in hospital-owned groups, according to the MGMA DataDive™ Provider Compensation 2016, which shows large increases for all hospitalists. The report, which is based on 2015 data, shows the median compensation for hospitalists specializing in internal medicine is $278,471 annually. 

The compensation rate increase for hospitalists is 18.78% since 2011. This increase outpaces the increase for physicians in family medicine  (without OB), which is 15.16% since 2011, as well as all specialists, who saw an increase of 10.68% during the same time period. 

Increase in demand

The increase in compensation most likely stems from an increased demand for hospitalists, says David N. Gans, MSHA, FACMPE, senior fellow, MGMA Industry Affairs. 

Increasing the number of hospitalists benefits hospitals and physicians in private practice for a number of reasons, Gans explains. For private practice physicians, it can be time consuming to follow patients into the hospital. It is inefficient for doctors and patients as it often takes time out of a doctor’s schedule that could be spent on seeing regularly scheduled patients. “It just doesn’t make a lot of economic sense,” Gans says. Hospitalists help relieve this issue. 

“The increase in hospitalists has improved physician lifestyle,” says Jocelyn Pemberton, MBA, CMPE, executive director, The Alaska Hospitalist Group, Anchorage, which has grown from three hospitalists to 50 since 2002. “Patient care has also improved and the length of stay for hospital patients has been shortened.” 

Having hospitalists on staff can improve efficiency, as staff hospitalists have a better understanding of the hospital’s procedures and work regularly with the nursing and support staff, according to Gans. 

There are a few downsides, such as the number of transitions between care givers, Pemberton adds. “There are more hand-offs between doctors, and more potential for risk; the more successful programs recognize this and develop processes that support the patient through their transitions.”

Better retirement benefits

Although most hospitalists are employed by hospitals and hospital-owned groups, it pays to work for a physician-owned practice. The median compensation for adult medicine hospitalists working in physician-owned practices is more than $10,000 more annually than salaries of counterparts working in hospital-owned groups, according to the MGMA DataDive™ Provider Compensation 2016.

Retirement benefits are better, too. 

Hospitalists at physician-owned practices had nearly twice the benefits as those in hospital-owned groups. Gans says this is due to physician-owned practices optimizing their retirement contributions for doctors, unlike hospital groups which have to consider a much more varied workforce. 

Having an on-staff hospitalist can be a real benefit to certain physician-owned practices, as well. For practices with a large number of managed care contracts, having a hospitalist can help lower costs and help handle risk better if the practice has a high number of patients at-risk for hospitalization. 

As for what things look like for the future, Pemberton believes that the move toward value-based payment systems will be driven by hospitalists. “Who can have the most impact on patient readmission to the hospital,” she asks and answers, “hospitalists.” 
What role do you think hospitalists can play in a value-based system? Email us: connection@mgma.org

Get more information, including benchmarking compensation data for nonphysician providers, academic medicine, medical directorship, on-call and physician placement starting salary with MGMA DataDive™ Provider Compensation 2016. The printed version of the MGMA Physician Compensation and Production Survey: 2016 Report Based on 2015 Data will be available in July.

Shannon Geis, Staff writer/editor, MGMA

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