Doctors’ incomes drop as hospitals accept internships, study finds


Hospitals’ obtaining of independent physician practices is linked to a slight drop in physician pay, with a 0.8% drop in normal pay, according to new findings published in Health Affairs. This recommends that medical clinics cannot benefit financially when hospitals purchase their practices. From 2014 to 2018, the responsibility of hospitals for the practices increased by 89%, and information from this period began to reveal contrasts in remuneration between the different formations. Non-surgical specialists, for example, have seen their average salaries fall by more than $ 9,650 per year, or 2.4%, while cautious experts have seen their livelihoods increase by 2.1%, or about 10%. $ 700 on average.

However, further analysis of the numbers revealed more detrimental effects on physician compensation than just average annual income. Compared to independent physicians, for example, people employed by health systems had about 49% lower annual health insurance billings, worked on average about three hours more per week, and practiced for a long time. less years.

Primary care physicians also saw an increase, although at 1.2% ($ 3,179) it was much more modest.

Yet, many physicians also see incentives to integrate with larger hospitals or healthcare systems, such as overcoming concerns over loss of referral privileges and seeking help implementing complex electronic health records. .


Revenue may also be more stable when operating under the umbrella of a larger hospital than when owning their own practices, and larger systems also tend to offer billing and regulatory compliance services. , which could potentially give clinicians more time to treat patients, according to the report.

Independent physicians are increasingly scarce, with just 30% of U.S. physicians practicing independently at the start of the year, according to a June analysis by Avalere for the Physicians Advocacy Institute.

The remaining 70% is employed either by hospital systems or by other business entities, such as private equity firms and health insurers. The catalyst for this trend is that hospital systems and businesses have driven healthcare consolidation by aggressively acquiring physician offices over the past two years, especially in the last half of 2020, deep in the the COVID-19 pandemic.

Hospitals and legal entities – mostly insurance companies, but also venture capital and private equity firms – now own nearly half of medical practices in the United States, the results show. During the two-year period, these entities acquired an additional 20,900 medical practices. About 48,400 more physicians left independent practice and became employees of hospitals or other companies during this period, and 22,700 did so after the onset of the coronavirus – representing a 12% increase employment.

Insurers and private equity firms generated the largest increases in acquisitions and employment in 2019 and 2020, at a rate of 32%. The COVID-19 pandemic, meanwhile, accelerated business ownership of physician offices and physician employment by health systems and other organizations during the last half of 2020. Businesses acquired 17,700 additional physician offices during this period, an increase of 32% of offices owned by companies. . Hospitals acquired an additional 3,200 doctor’s offices over the two-year period, resulting in an 8% increase in hospital-owned practices.

Overall, there is a consistent trend of increasing employment and hospital ownership of practices in every region of the country, with some differences in the types of acquisitions resulting in regional consolidation. THE BIGGEST TREND

An annual report by Merrit Hawkins that tracks physician recruitment trends found that by 2020, COVID-19 dramatically altered the physician labor market, resulting in a temporary reduction in starting salaries and practice options for physicians . The weak job market for doctors is the result of the devastating economic impact COVID-19 has had on the healthcare sector. The American Hospital Association reported that hospitals and healthcare systems lost $ 200 billion in the first quarter of 2020. The Medical Group Management Association reports that physician office revenues have declined by an average of 55%.

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  • Doctors’ incomes drop as hospitals accept internships, study finds
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