MGMA survey: Physician executives earn more at physician-owned practices


Compensation for executives and administrators at physician practices varies depending on ownership, according to a new survey from the Medical Group Management Association (MGMA).

If you’re a health executive or administrator you will want to work in a large or hospital-owned practice to receive the highest compensation. If you are a physician executive you’ll earn more at a physician-owned practice, according to the 2015 MGMA Management and Staff Compensation Survey.

Senior and general managers at hospital-owned practices earned higher salaries than their peers in physician-owned practices in 2015, the survey found. The median compensation for non-physician CEOs at hospital-owned practices was $305,000 compared to roughly $242,000 for those at physician-owned practices. For administrators, median compensation was $141,400 at hospital-owned practices and $106,000 at physician-owned practices.

The opposite was true for physician executives, who earned higher median compensation of $350,000 at physician-owned practices and $300,000 at hospital-owned practices.

“The business value of skilled medical group practice executives and administrators is increasing and will only continue to increase, particularly given the growing burden of complexity within the regulatory and payer environments,” said Halee Fischer-Wright, MGMA’s president and CEO, in an announcement about the survey. “It is now more important than ever that practice managers understand and shape trends in the healthcare industry so they can better compete in this rapidly-changing field.”

Based on data from more than 67,000 practice managers and staff, the survey results included the following:

Compensation varied significantly by practice size. In general, the larger practice, the higher the pay. Practice CEOs and executive directors at practices with 25 or fewer employees earned approximately $181,000 last year, compared to those in larger practices with 151 or more full-time employees who earned more than twice as much at $430,000. Peers in mid-sized practices with 25 to 50 full-time employees earned roughly $252,000. Administrators saw a similar variation: those in mid-sized practices earned $180,500 while those in small practices with six or fewer employees earned less than $90,000.

Compensation varied by geography. CEOs and executive directors in the Midwest earned the most last year. Those at larger practices saw median salaries of more than $447,500 and those at smaller practices with 25 or fewer full-time physicians earned $234,000. Executives at larger practices in the East and at smaller practices in the South received less than those working in other regions of the country.

Bonuses were better at hospital-owned practices. Physician executives at hospital-owned practices received larger median bonus and incentive payments than those in physician-owned practices, at $70,000 and $36,000 respectively. The same was true for non-physician management executives, who received median bonuses of about $24,000 at hospital-owned practices, compared to $10,000 at physician-owned practices.

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