The economy may be sputtering, but pay for most top-level physician executives in most work-area categories is rising far faster than inflation. Hospitals have the loosest purse strings, according to a survey by the Physician Executive Management Center.
The Tampa, Fla., recruiting firm has conducted salary and scope-of-work surveys of physician executives since 1986. This year, the survey was taken by 106 physician CEOs and CMOs working in hospitals, integrated delivery systems and medical groups. Results were released exclusively to Modern Physician last month.
Compared to 2001 survey results, physician leaders working in hospitals saw average annual total compensation (defined as salary and bonus) increase the most of the three survey groups--by 9.1%, or $21,054, to $251,195 per year.
In integrated systems, average total pay for physician executives, while highest at $292,727, was up by a more modest 2.2%, or $6,215.
In medical groups, the average physician leader's pay package was 7.5% heavier, increasing by $16,712 to $239,253.
Top physician executives in hospitals averaged 17 years of clinical experience before joining management ranks, while system and group leaders averaged 13 years as clinicians.
Most had management experience in their previous positions: 72% among hospital executives surveyed, 95% of physicians in systems and 88% of leaders in groups. Time spent in their current management jobs had been fairly short, running four to six years, a range that has remained markedly consistent over the years.
But burnout isn't a factor, says David Kirschman, president of the Physician Executive Management Center. "Physician executives burn out less often than CEOs," he says. The national turnover rate for hospital CEOs was 14% in 2002 (see May, page 21).
"It may happen that change occurs because new CEOs come in, and maybe half or a third change their senior management team, if for no other reason than because they're just a different personality," Kirschman says.
Slightly less than one in four (24%) of physician executives in hospitals maintained some clinical duties. More than one in three (36%) of systems leaders still saw patients. Nearly half (47%) of group executives still practiced as clinicians.
The percentage of physician executives running systems and still keeping a clinical practice more than doubled from the previous survey.
"I find that kind of odd," Kirschman says. "Three years ago, it was down to 15%, and it's increasing, and I don't know why. Maybe they feel they ought to be doing some clinical work to maintain credibility as a physician. . . . The jobs involve so much, it's just hard to imagine them having much time for clinical practice.
"With groups, it's the opposite," he says, "because the culture in groups is if they're not doing clinical work, they don't have the same value."
The report showed 35% of group-based physician executives surveyed had an advanced business degree, while 40% of physician leaders in hospitals and 62% of their counterparts in systems had advanced degrees, the MBA being the most common.
"In the perceptions of physician executives, an advanced management degree is important," Kirschman says. "Actually, the dirty truth is that an advanced management degree is not a critical factor in probably 98% of the jobs. They're nice to have, but they're not critical."