Better Solutions for Healthcare

Healthcare Dive: Physician revenues have jumped 52% since 2016

Physician revenues have jumped 52% since 2016

By Tony Abraham

Dive Brief:

  • The average net revenue generated annually by physicians for their hospitals has grown significantly since 2016, according to a Merritt Hawkins survey of 62 hospital CFOs. Responses showed the combined net inpatient and outpatient revenue generated annually by a single physician totaled $2.3 million, a 52% increase compared to the group’s 2016 survey.
  • Revenue growth levels for both specialty and primary care physicians were the highest Merritt Hawkins’ survey has recorded, and net revenue generated by primary care physicians increased “significantly” due in part to increased hospital employment. Merritt Hawkins researchers said the portrayal of revenue netted by physicians is fair and accurate despite the small sample size.
  • According to Merritt Hawkins, a subsidiary of staffing giant AMN Healthcare, increased levels of hospital-employed physicians have buoyed inpatient volumes. The group also noted a lack of disparity in revenues generated by hospital-employed physicians and outpatient specialists, suggesting the movement toward value-based care hasn’t impeded specialists’ ability to generate revenue.

Dive Insight:

Physician revenue is growing in tandem with utilization, driven in part by an aging population presenting increasingly complex conditions.

A quality-based healthcare system would prioritize prevention and proactive policies like population health management over “invasive procedures and treatments” performed by specialists, the report speculates. Such a system, the researchers write, would catch illnesses early and treat them less invasively at a lower cost.

That the system isn’t quite there yet is demonstrated by the continued growth in specialty care. Cardiologists, neurosurgeons, orthopaedic surgeons and cardiovascular surgeons are the highest revenue-generators among their peers, each netting more than $3 million a year for their hospitals, according to the survey.

While total hospital admissions have flattened, so have the number of hospitals, leading the Merritt Hawkins paper to suggest admissions have actually increased. Hospital outpatient visits have more than tripled since 1975, and costs for those visits have increased 62% in that time.

Another driving force behind physician revenue growth could be the increasing number of hospital-employed physicians, who “may be more likely to direct tests, therapies and other services” — as well as patients — to the hospital that employs them.

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