Last December, Santa Barbara (Calif.) County’s Department of Behavioral Health and Wellness gave permission to pay $90,000 signing bonuses to attract new psychiatrists to the county and to boost psychiatrist pay by 8%. The department had been offering $75,000 bonuses since 2015, but county commissioners determined those were not persuasive enough.
Elsewhere, some employers have offered as much as $300,000 signing bonuses for medical director jobs, while others in tight real estate markets are offering stipends to help physicians relocate, notes Leah Grant, interim president of AMN Healthcare Physician Solutions in Modern Healthcare’s recent Physician Compensation Survey. The report analyzes physician compensation survey findings from nine different consulting and recruiting firms.
Meanwhile, the average physician signing bonus jumped 21% to $37,473, according to AMN Healthcare’s 2023 Review of Physician and Advanced Practitioner Recruiting Incentives.
The highly competitive post-pandemic labor market, particularly for specialists, is impacting the compensation packages health care providers are offering, experts say.
3 Trends from 2023 Physician Compensation Data
1 | Specialists in High Demand
America’s aging population continues to fuel high demand for specialty care, helping to drive up compensation. The high demand for radiologists, anesthesiologists, psychiatrists, cardiologists, gastroenterologists, orthopedic surgeons, neurologists, oncologists and others reflects the needs of an aging population that relies on specialty care, medical tests and procedures. For example, average base salaries for anesthesiologists rose 12.5% year over year while obstetricians and gynecologists saw average base pay rise 10.5%, the AMN report shows.
Despite offering higher compensation levels for specialists, many provider organizations are still having difficulty recruiting for these roles. Modern Healthcare’s report reveals that behavioral health practitioners, ear, nose and throat specialists and dermatologists are among the most difficult to recruit.
2 | Primary Care Physicians (PCPs) See Modest Compensation Gains
While demand for PCPs remains high in some regions, total compensation within the sector rose only 4.4% in 2022, according to Medical Group Management Association data released in May. That’s up more than double on a percentage basis from 2021, but still below the inflation rate for 2022.
PCPs saw the largest pay hikes among surgical and nonsurgical specialists and advanced practice providers. Overall, however, primary care physicians remain among the lowest paid of all specialties. The market disruptors are adding to the competition for these providers, which already was strong among traditional employers like hospitals and medical groups.
3 | Quality Matters in Compensation, But How Much?
Metrics such as patient experience scores or timeliness in receiving care continue to be factored into compensation but these data account for only about 8% to 10% of the total for staff-level physicians across specialties, notes Dave Hesselink, managing principal at SullivanCotter.
Some employers are offering higher base salaries to give physicians sufficient support to focus on quality.