MGMA report: Physician pay continues to rise

© Valeri Luzina - stock.adobe.com

Primary care physician pay has risen for the fourth year in a row despite continued pressure due to heightened expenses and the strong labor market, according to a report from the Medical Group Management Association.

The 2024 MGMA DataDive Provider Compensation report looked at 2023 data from more than 211,000 physicians and advanced practice providers (APPs) and found that primary care physicians saw the largest gains among providers with a 4.44% increase followed by surgical specialist physicians with a 4.42% increase. Nonsurgical specialist physicians only saw a 1.81% increase last year.

While the primary care and surgical specialist increases were greater than the 3.4% rise in the Consumer Price Index last year, the five-year change in physician compensation across all specialties fell behind the 21% index surge during the same period. Meanwhile, APPs saw a greater gain than physicians in total median compensation with 6.47% increase last year, and a 16.23% gain since 2019.

The increased compensation was paired with the continued growth in physician productivity with primary care, surgical and nonsurgical specialties in independent and hospital-owned practices all reporting higher median work relative value units last year compared to 2022.

Staffing was cited as a crucial challenge to practices, but an increasing share of executives say that finance and revenue cycle improvements are their main focus for 2024. They see new technologies like artificial intelligence as becoming integral to successfully lead a health care organization.

"Despite being faced with escalating overhead, declining physician reimbursement, and a challenging labor market, medical groups pushed themselves to elevated levels of productivity in 2023, ensuring they could meet the increased demand for care in their communities," Halee Fischer-Wright, MD, MMM, FAAP, FACMPE, president and chief executive officer at MGMA, said in a news release. "As physician and other staffing shortages persist, medical group leaders should embrace the latest digital technologies to assist in optimizing operations, maintaining access to care and recognizing meaningful cost savings."