Docs to get smaller raises in 2012; groups fare better

Physicians across the board can expect to see smaller compensation increases in 2012 compared to this year, but those in group practices won't be hit quite as hard, according to Hay Group's 2011 Physician Compensation Survey released this week.

In particular, the survey predicts physicians across all organizations to get pay increases of 2.5 percent next year, down from actual increases of 2.7 percent this year. Physicians working in group practices, while also getting less than last year, are expected to earn slightly higher pay increases of 3.2 percent in 2012 versus 2.5 percent for those working in hospital-based settings.

According to the survey, physicians' pay increases, from best to worst, are predicted for 2012 as follows:

  • Group-based specialist--4.5 percent
  • Group-based primary care--3.3 percent
  • Group-based overall--3.2 percent
  • Hospital-based primary care--2.9 percent
  • Hospital-based overall--2.5 percent
  • Hospital-based specialist--2.4 percent

In addition, researchers found that annual incentive plans for physicians were less common in 2011 (64 percent) than they were in 2010 (69 percent). Among organizations that did pay incentives, amounts continued to be determined based on quality and patient satisfaction.

"At-risk pay can be a critical factor in driving performance at healthcare organizations," Jim Otto, senior principal in Hay Group's healthcare practice, said in a statement. "While nearly one in four providers are not yet implementing annual incentive plans, the remaining three see the benefit or potential benefit of linking pay to performance measures. If designed correctly, annual incentive plans will have profound positive effects on culture, behaviors and the success of the organization."

To learn more:
- read the press release from the Hay Group
- read the article from the Philadelphia Business Journal