November 20th, 2013
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What is Physicians Salary
The demand for physicians is projected to increase by as much as 25% by 2020, according to the U.S. Department Of Labor. This means there will be more opportunities for new doctors. But how will this increase effect physician’s salaries?
Over the last 10 years, physician salaries have steadily increased by around 6% annually, on average. The general cost of living has increased 23% since 2004, so compensation for physicians has certainly kept pace with inflation. In fact, it is comfortably ahead of the curve. Projections for the next 5 years indicate that this trend will most likely continue.
What Are Some Of The Factors That Effect Physicians Salaries?
Physicians salaries are always a ‘hot button’ for clinics and health organizations. But the competition for attracting good practitioners is so intense that they are pretty well stuck with having to offer prime salaries and benefits to attract the best doctors, especially in rural and low-income areas.
There are many factors that can effect doctors salaries, but there are 5 major ones. They are:
Physicians that specialize can earn more than twice as much as a PCP (Primary Care Provider), depending on their specialty. Many specialties are in higher demand, such as cardiology and neurology, and command higher salaries.
2. Hospital Ownership-
Primary Care Physicians in multi-specialty hospitals, and IDS (Integrated Delivery System) hospitals earn an average of $12,000.00 more annually than physicians in non-IDS owned facilities. (Note-an Integrated Delivery System is a network of health-care organizations, physicians, hospitals and clinics that are owned by a parent company. Examples of this would be CIGNA Health Care, and Humana Health Care Systems).
The area where a physician practices also effects their salary. By region, physicians in the Southeastern United States earn around 10% to 15% more than in the Northeast, 5% more than in the Mid-West, and 8% more than in the West. This is because the region is less desirable, with more rural and low income areas, and higher compensation is necessary to attract more doctors to the area. Of course, this can also vary by specialty. For example, a plastic surgeon will probably make more money in Los Angeles, or New York, than in Ocoee, Tn.
4. Group Type-
As a rule, physicians working in a single-specialty group make a little more than doctors who work with multi-specialty groups. There are a few exceptions. Orthopedic and general surgeons usually make a little more working with multi-specialty groups.
5. Rate of Income Growth-
Like any other business, certain specialties experience higher annual salary increases than others, mostly due to supply-and-demand. The average yearly increase for a Primary Care Provider is around 6%. Others increase more, such as oncology at 14.9%, Neurology at 8.9%, Orthopedics at 7.9%, and Radiology at 6.6%.
Other factors that effect physician salaries are the type of relationship they have with their employers. An employed physician’s compensation includes a salary, benefits, bonus, and profit-sharing options. For partners, compensation can include a salary, benefits package, and a cut of the profits after business expenses have been deducted, but before income tax is assessed. Compensation can also include such non-medical sources as expert witness fees, speaking engagement fees, and product sales.
Depending on if you specialize or not, you can expect a salary of anywhere between $160.000.00 to over $600,000.00 for 2013.