Many physicians see part of their compensation tied to their productivity

A stethoscope and paper money.
Productivity is a factor that is playing a greater role in physician compensation. (Getty/utah778)

Physicians are still getting a lot of their pay from personal productivity despite broader attempts to shift to value-based payment models.

An analysis (PDF) from the American Medical Association found that 31.8% of the average physician's compensation came from personal productivity in 2016.

Salary continued to be the dominant method of physician compensation, but productivity was also a large and important factor, especially for doctors who are practice owners, according to the report, which was based on the 2012, 2014 and 2016 surveys.

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“On the individual-physician level, personal productivity remains a key driver of compensation,” the AMA said in an article that looked at the research.

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The analysis found that more healthcare organizations are increasingly using multiple methods to determine physicians’ overall compensation. The makeup of the average physician's compensation includes salary, 52.5%; personal productivity, 31.8%; practice financial performance, 9%; bonuses, 4.1% and other sources, 2.5%. The percentage of individual physicians’ income derived from salary varied by ownership status, practice setting and medical specialty.

But the extent to which productivity determines physician compensation may actually be greater than indicated. At least one-third of physicians who are paid strictly with a salary indicated that the amount was at least partly determined by their productivity in the prior year.

Productivity accounted for 44.7% of compensation for private practice owners, compared to 22.3% for employed physicians. Greater physician productivity was one of four factors that profitable, high-performing medical practices have in common, research from the Medical Group Management Association found.

Doctors employed by hospitals were more likely to receive a salary than were physicians in single and multispecialty practices, and their compensation was less likely to be based on personal productivity.

No doubt some doctors are feeling the pressure to increase productivity, including taking on more patient visits. Practices are also looking for ways to increase physician productivity and revenue, trying to reduce the large chunks of time physicians spend bogged down handling uncompensated tasks such as paperwork by taking steps like hiring scribes.

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