- Primary care physicians saw their compensation rise faster than other medical and surgical specialties in 2022, as significant E/M coding changes enacted by the CMS kicked into gear and volume stabilized coming out of the pandemic.
- Medical groups and healthcare organizations reported a 6.1% increase in primary care compensation in 2022 compared to 2021 in the AMGA’s most recent compensation survey published on Wednesday. That’s compared to 1.5% and 1.6% increases for medical and surgical specialties, respectively.
- Medical groups’ revenue increased faster than compensation gains for physicians, a trend the AMGA said could be due to groups using more revenue to address higher expenses as supply and labor costs soared.
Recent primary care compensation increases are a bright spot for a profession that is integral for the provision of preventative medical care in the U.S., but faces notable challenges. Experts warn the U.S. primary care chassis is chronically underfunded and facing acute doctor shortages, problems that were amplified during COVID-19.
But primary care doctors have particularly benefited from CMS coding tweaks in 2021, according to the new survey, which includes data on more than 190 medical specialties.
Primary care physician work relative value units (wRVUs) increased 4% from 2021 to 2022, compared to a median gain across specialties of just 2.9%, the AMGA’s survey found.
“The gains for primary care are evident as the smoke clears from the slow transition to the utilization of new wRVU weights for compensation calculation and the volume swings of the pandemic,” AMGA consulting director Elizabeth Siemsen said in a statement. The AMGA is a trade association representing multispecialty medical groups.
The CMS in 2021 overhauled the physician payment system. Regulators increased wRVU values for office-based E/M to include non-face-to-face work, to recognize the time burden on doctors associated with medical documentation.
The CMS also reduced the conversation factor — the dollar amount multiplied by wRVU values to calculate Medicare payments for clinicians. The net result for most specialties has been a revenue increase, due in part to increases in E/M reimbursement, according to experts.
Despite rising wRVUs, compensation per wRVU percentages have yet to return to levels that were trending prior to COVID-19, according to the survey.
It increased 0.3%, compared to an average growth of 2.8% from 2016 to 2019. Primary care doctors saw a more significant increase in median compensation per wRVU than other specialties, which could also be due to the 2021 wRVU changes, AMGA said.
Meanwhile, medical groups’ median net collections increased 5.2% year over year, higher than the percentage increases in compensation. The disconnect between revenue and physician pay is “more pronounced than in prior years,” the report said.
“A lower compensation-to-collections ratio suggests that a higher percentage of revenue is going to cover all the expenses that have seen an increase in the past few years. These include staff expense, supply expense and the like,” Fred Horton, president of AMGA Consulting, said in a statement.
Physician salaries have been trending upward in recent years, including a 33% increase for primary care physicians from 2015 to 2022, a Medscape survey found. However, physician pay growth took a hit during the COVID-19 pandemic, and has also been hampered by inflation.
Overall, physicians earned $352,000 on average last year, with specialists making $382,000 and primary care doctors earning $265,000, according to Medscape.
The nation’s primary care workforce has shrunk in size in recent years due to rampant consolidation, closures and neglect that only worsened during the pandemic. By one estimate, America’s primary care practices lost over $15 billion in 2020 during a catastrophic plummet in patient visits. Declining financial health has pushed practices to consolidate or close altogether.
By one estimate, the country could be short by as many as 55,000 primary care doctors by 2032.
Congress is currently debating changes to existing physician payment systems to better nudge providers toward value-based models and provide more reliable reimbursement.