Physicians drive the health care economy through commercial insurance billing

Physicians drive the health care economy through their own work and follow-up tests and procedures for patients.

Doctor bills to commercial health care insurance companies average $3.8 million a year, according to AMN Healthcare, which supplies health care staffing and revenue cycle solutions.

The company’s 2023 Physician Billing Report examined claims submitted by physicians in 18 specialties, along with claims filed by nurse practitioners (NPs) and certified registered nurse anesthetists (CRNAs).

By specialty, general surgeons had the highest average claims, topping $11.66 million, while pediatricians had the lowest average at about $1.32 million.

Apart from the dollar amounts, the figures show the economic role physicians have in the health care economy because a number of other clinicians and health care workers depend on their work.

“Billing amounts are a key metric because they reveal how physicians generate services and revenue throughout the healthcare system, both directly and indirectly,” Linda Murphy, president of AMN Healthcare’s Revenue Cycle Solutions division, said in a news release.

“For example, a physician may submit a bill for a patient diagnosis that subsequently leads to a hospital admission, x-rays, anesthesia, surgery, therapy, and other services,” Murphy said. “Care provided to the patient may be delivered by nurses, therapists, technicians, and many other types of healthcare professionals, but the process often begins with the physician.”

Billing vs. collections

The report noted the billing amounts do not necessarily reflect the dollars that end up back at the office, or in doctors’ pockets. Payers “may choose to discount a part of a physician’s claim or deny payment altogether,” according to AMN. Collection rates may vary widely among physicians based on specialties, payer mix of their practices, and other factors.

“However, given a hypothetical collection rate of 50 percent, the average collection amount for all providers in the report is $1.9 million,” the news release said.

By specialty

The AMN data showed “physicians who practice in diagnostic, surgical and internal medicine subspecialties typically generate higher average billing to commercial payers than do primary care physicians.”

Specialists generated an average billing amount of more than $4.65 million sent to commercial payers, while primary care physicians generated billing worth an average of $1.77 million. Specialists are paid more, so typically generate larger claims that primary care physicians, according to AMN.

“However, the activity of primary care physicians may lead to considerable ‘downstream revenue’ through the hospital admissions, tests, and treatment they order,” the report said.

Primary care physicians generated an average of more than $2.11 million a year in net annual revenue for their affiliated hospitals, close to the $2.44 million in net annual revenue that specialists generated, according to AMN, citing an earlier study.

APPs in the mix

Advanced practice professionals such as CRNAs and NPs also generate revenue, according to the report.CRNAs submit an average of $1.75 million in claims to commercial payers, while NPs bill an average of $777,393.

The figures underscore their economic importance, according to AMN. There are more than 49,000 CRNAs actively practicing in the United States, with autonomous practice in 19 states. NPs can practice autonomously in 26 states and the District of Columbia, with close to 90% of them certified for primary care.

While their billing amounts are lower, they also are paid less: an annual average starting salary of $211,000 for CRNAs, compared to $400,000 for anesthesiologists, and $153,000 for NPs, compared to $251,000 for family physicians. There are about 36,000 NPs completing academic programs every year, more than the number of physicians who complete their training annually, the report said.

“Advanced practice professionals are playing a greater role in healthcare delivery due to state policies that have expanded their scope of practice and due to the physician shortage,” Murphy said. “Their role as revenue generators has expanded correspondingly.”