The average compensation of full-time physician executives has risen consistently over the past decade, topping $180,000 last year, a new report says.
Physician Executive Management Center, a Tampa, Fla.-based physician search firm, prepared the report, which is based on the firm's annual surveys of about 300 physician executives dating back to 1986.
PEMC released an advance copy of the report to MODERN HEALTHCARE last week.
The PEMC report documents the steadily rising compensation received by physician executives employed by hospitals, group practices and managed-care plans. These senior medical managers often hold the titles of vice president of medical affairs or medical directors. The employment of physicians in senior healthcare management positions has grown in popularity as institutional healthcare providers have attempted to increase and maintain physician loyalty to an organization during tumultuous times.
PEMC executives attribute the rising compensation to the growing importance of such physician executives to institutional healthcare organizations.
"After 10 years of conducting these surveys, we have reaffirmed our impression that this has become a mature, established professional group," said David Kirschman, PEMC's president. "The number of physicians who have assumed leadership roles continues to increases, the number of positions for physician executives is increasing, and the value of physicians at the senior level of administrative teams is constantly being recognized within the healthcare industry."
From 1986 to 1995, the average total compensation received by full-time employed physician executives has risen 48.2%, or about 4.8% annually, to $183,732 from $123,975 (See chart).
Total compensation includes base salary and bonuses or incentive pay. In 1995, bonuses or incentive pay represented nearly 14% of a physician executive's total compensation, according to PEMC.
Total compensation doesn't include various perquisites and fringe benefits, which were valued at an average of $23,283 per physician executive.
For example, 25% of the 297 full-time physician executives responding to the latest survey reported receiving an automobile or automobile allowance in 1995. Some 22% enjoyed company credit cards for work-related entertainment costs. And, 7% had full- or partially paid country club memberships.
However, while physician executive salaries and perquisites have improved, the profile of a typical physician executive hasn't changed much over the past decade.
According to PEMC's latest survey, the typical full-time employed physician executive was a male in his mid-50s.