Physician Compensation Greater in Private Practices Than Academic Practices

April 5, 2010, ENGLEWOOD, Colo.-Annual compensation for primary care and specialty care groups in academic practice slowed between 2008 and 2009, increasing only 2.93 percent for primary care physicians and 2.43 percent for specialists, according to the MGMA Academic Practice Compensation and Production Survey for Faculty and Management: 2010 Report Based on 2009 Data.  Primary care physicians reported compensation of $158,218, while specialty care physicians reported compensation of $238,587, a difference of $80,369.  From 1999 to 2009, compensation in academic practices continued to trail that in private practices. 

Between 2005 and 2009, compensation for primary care providers' in academic practice rose 16.96 percent, and compensation for specialists increased 20.81 percent.  For physicians in internal medicine, compensation increased 4.46 percent between 2008 and 2009, while the annual compensation of family practitioners increased only .42 percent.  By comparison, compensation for cardiologists (invasive) increased 7.29 percent while neurologists' compensation decreased 2.52 percent between 2008 and 2009.  Ophthalmologists experienced a 9.35 percent rise in compensation over the past year, while many other specialists reported slight decreases in compensation. 

Factors that contributed to changes in compensation levels included geographic section, faculty rank and productivity.  Median compensation for primary care physicians increased in three of the four reporting geographic sections, the greatest increase occurring in the Midwest (6.75 percent). Physicians in the Western section reported a decline in compensation.  Specialists reported similar trends; compensation in the Western section decreased by 2.11 percent between 2008 and 2009. 

Survey respondents also reported compensation increases and decreases based on faculty rank.  Primary care positions, including that of department chair experienced increased compensation (up 13.86 percent from 2008).   Some specialty care professionals reported decreased compensation based on their rank.  Compensation for assistant professors and professors decreased .09 percent and .07 percent respectively.

"The economics of academic medicine are that teaching and research activities are not reimbursed in the same manner as in clinical practice," explained Billy Newton, vice dean for Finance and Resource Planning at Duke University School of Medicine, about the difference in compensation between academic and private practices.  "The private practicing physician typically produces more patient care revenue than the academic physician, whose role also includes teaching, research, and other administrative efforts."

The Academic Practice Compensation and Production Survey for Faculty and Management: 2010 Report Based on 2009 Data is academic-specific data that provides data encompassing physician and non physician faculty and management. 

Note: MGMA surveys depend on voluntary participation and may not be representative of the industry. Readers are urged to review the entire survey report when making conclusions regarding trends or other observations

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