Perhaps most importantly, previous SHM survey numbers included a significant proportion of academic hospitalist practices, which were largely unrepresented in the new SHM-MGMA survey data because SHM and MGMA will be conducting a separate survey of academic hospitalist practices in the fall.
Since academic hospitalists tend to earn less—and have lower overall productivity—than hospitalists in other settings, their absence from this survey likely results in greater increases in average compensation and production than would otherwise have been the case.
Beginning in about 2001, MGMA began reporting hospitalist compensation, but I have left those numbers off of this figure. And since about 2002, SHM has separated data for hospitalists who care for adults versus those that care for children; when separate data were available, this figure shows the compensation for hospitalists who care for adults and excludes pediatric hospitalists.
Note that the compensation figures include all salary elements, including a “base” or fixed component, productivity component, quality bonus, etc. The numbers exclude such benefits as the cost of health insurance or matching retirement plan contributions.
Inflation and a trend of increased hospitalist productivity are two reasons that hospitalist compensation has been increasing, but neither explains more than a portion of the increase in salary. (According to computational-knowledge engine WolframAlpha.com, inflation in the U.S. averaged 2.3% per year from 1997 to 2002. I’ll talk more about trends in hospitalist productivity in a future column.) I think the principal reason for the rising trend in our pay is “market forces,” primarily demand for hospitalists that has exceeded the supply.
What the Future Holds
It is interesting to speculate whether the historical trend line will accurately predict future increases in salary. At some point, forces will have to “bend the curve” so that it climbs more slowly. It could look like a curve reaching asymptote.
It is anyone’s guess when that might start to happen, but there are two developments over the last couple of years that suggest it might be coming: In some markets, the demand for hospitalists has been met and new candidates can’t find positions, so salaries in those markets might start to level off. And, unlike a few years ago, hospitalists are now competing with nearly every other physician specialty to get financial support from their hospitals, so hospitalists might find their hospital has less money available for them.
But the really big—and unknown—variable that could increase or decrease future hospitalist salaries is the effect of any further national healthcare reform legislation. TH
Dr. Nelson has been a practicing hospitalist since 1988 and is cofounder and past president of SHM. He is a principal in Nelson Flores Hospital Medicine Consultants, a national hospitalist practice management consulting firm (www.nelson flores.com). He is course co-director and faculty for SHM’s “Best Practices in Managing a Hospital Medicine Program” course. This column represents his views and is not intended to reflect an official position of SHM.