Physician Compensation in 2020: A Review
The effects of the coronavirus pandemic are often viewed from the perspective of the patient. In the doctor’s world, it may not be as apparent. A whirlwind of changes was sparked as an effort to stop the spread of this virus, such as advancement in telehealth or increased requirements for personal protective equipment. The observer has to wonder how it affected physicians’ lifestyles in terms of dollars and cents. Here is a synopsis of real-life data demonstrating how COVID-19 impacted physician compensation in 2020.
Impact on final pay
Jumping back to dollars and cents, it may be surprising that physician income during 2020 ended up being compatible with 2019, based on the Medscape Physician Compensation Report. Primary care providers earned $243k in 2019 while missing the slim mark at $242k in 2020. Similarly, specialists earned $346k in 2019, while receiving final pay of $344k in 2020.
This is because various solutions were formed either as a result of the pandemic or as practical knowledge applied. Practical solutions involved reducing overhead coverage, re-negotiated contracts or decreasing staff size. Other solutions came through pandemic recovery programs created to sustain businesses practices, such as the Payment Protection Program.
Advancements in telehealth helped keep many offices running. Because more insurances began accepting it, more services were reimbursable resulting in paycheck consistency. Certain physicians were able to carry on the day’s work through virtual office visits as they assisted patients online or on call.
On top of this, incentive bonuses ended up being higher during 2020 than in 2019. 2020 was a year that brought about unforeseen hardships. Somehow, it also brought along inconspicuous ways to keep society afloat.
Impact on physician demographics
Specialties were affected in different ways. While some health services decreased, others increased. Essential versus nonessential services regulated this at the beginning. However, the toll of the pandemic led to other health issues in communities that demanded medical attention. Higher stress levels, lower self-esteem and self-consciousness certainly impacted diagnosis, and thus, the type of treatment patients started receiving during and after the economic disruption. Plastic surgery earned the highest average compensation of $526k, while orthopedics followed immediately afterward at $511k.
Earnings for the top five specialties were the same as the previous year for both full-time employed and self-employed physicians. It is also important to note that while the majority of doctors stated the COVID-19 pandemic contributed to their loss of income, while at least 17 percent of physicians confirmed their income shortage was not related to COVID-19 at all. These reasons included general retirement, change of practice or maternity leave. So, a specialty making less money did not necessarily mean coronavirus contributed to it.
Differences in compensation between men and women were striking based on a salary report from the Medical Group Management Association. Males consistently made between 27-33 percent more than their female counterparts. On the flip side, 64 percent of women physicians placed high priorities on a balance between work and home life, which would affect pay amounts to some extent.
Impact on rules and regulations
Changing rules and regulations continue to heavily impact how doctors conduct their businesses. For the most part, positive attitudes and adaptability remain strong while medical help and how it is delivered to patients change all around.
Challenges are real though. Increased personal protective equipment alone adds a hefty expense to doctors’ offices, as face masks, gloves and hand sanitizer are put to full use for staff and patients. Higher insurance policies and malpractice risks are among top concerns, as well, in light of new vaccines and unexplored telehealth operations.
There are also new endeavors created to increase Medicare and Medicaid insurances, like the Merit-Based Incentive Payment System. While this program is meant to motivate providers with bonus payments, there is a downside of a nine percent penalty towards Medicare reimbursements for failure to participate.
Some doctors see the ongoing updates and changes of medical policies and procedures as draining and as a hindrance to their practices.
Over half of surveyed physicians are back up to regular business hours and income. Many expect to return to complete normalcy within one to two years. Doctors confirmed that their worst financial hardship lasted about three months on average last year. Although about 13 percent of providers reported that they received no income for a temporary period. So, recovery may take longer.
All in all, physician compensation reports reveal that physician income remained steady despite COVID-19. Some specialties were hit harder than others, such as dermatology. However, 67 percent of those physicians felt they were compensated fairly.
Despite obstacles that were faced, the majority of physicians say they would choose their profession again despite the hardships. Contributing to the restoration of a healthy and resilient population proves to be their chief goal. The physician compensation report is a clear indicator that as future healthcare changes, so will the endeavors to maintain optimal societal and economical wellness.
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