How the pandemic affected physician compensation

By Jonathan Ford Hughes
Published May 19, 2021

Key Takeaways

A new Medicus Firm report on physician hiring and compensation offers a mixed bag of insights. First, the bad news: The cancelation of elective procedures directly and indirectly resulted in revenue declines and consequently, slowed hiring and chilled signing bonuses. The good news: This is likely a temporary phenomenon. Those patients who needed the elective procedures? They still need them.

“Looking at 2021 and beyond, the healthcare system will be challenged to respond to delays in care and the return of a high-demand healthcare environment,” the report reads. 

The report is based on the Medicus Firm’s hundreds of job searches and placements across the U.S. Let’s take a deeper dive into the findings.

Annual Compensation

The big number: +24.72 percent

Psychiatrists saw the greatest increase in average annual compensation, bringing in $319,380. That’s a 24.72 percent year-over-year increase. The COVID-19 pandemic was and is accompanied by a shadow mental-health pandemic. According to the Kaiser Family Foundation, four in 10 U.S. adults have experienced anxiety or depressive disorder symptoms during the pandemic. In September 2020, the National Council for Behavioral Health reported that 52 percent of healthcare organizations saw an increase in demand for services. Sixty-five percent had to cancel, reschedule, or turn patients away. These data seem to indicate an increased demand for psychiatric services.

The small number: -23.33 percent

Cardiologists took the biggest hit in annual compensation, netting an average $345,000. That represents a 23.33 percent decrease, year over year. In May, the New York Times ran the following article, raising the concern of where all of the cardiac cases had gone. The American College of Cardiology published a study in January that showed nationwide, the number of deaths due to ischemic heart disease and hypertensive diseases increased during the early phases of the pandemic. 

“The present findings support the idea that many patients suffered cardiovascular events without seeking medical attention, or presented in a delayed fashion and suffered worse clinical outcomes, as many practitioners feared,” the researchers wrote.

The top-five compensation gains by specialty (year-over-year change in parentheses)

  • Psychiatry: $319,380 (+24.72%)

  • Anesthesiology: $430,375 (+20.40%)

  • Urology: $537,500 (+16.53%)

  • General Surgery: $428,760 (9.76%)

  • Dermatology: $373,750 (+3.10%)

The top-five compensation declines by specialty (year-over-year change in parentheses)

  • Cardiology: $345,000 (-23.33%)

  • Gastroenterology: $498,125 (-11.58%)

  • Neurology: $345,000 (-6.08%)

  • OB/Gyn: $298,125 (-6.40%)

  • Internal medicine: $236,250 (-5.42%)

Signing Bonuses

The picture for signing bonuses in 2020 is slightly rosier. Seven out of 11 specialties saw year-over-year increases in signing bonuses. This could be a byproduct of the fact that despite the temporary blow to the healthcare system delivered by COVID-19, the physician shortage is here to stay. 

Seventy-seven percent of new hires received signing bonuses. Sums ranged from $3,000 to $220,000. 

The big number: +131.58 percent

Though cardiologists may have seen the biggest declines in annual compensation, their signing bonuses have increased the most. On average, new hires netted $27,500 when they inked their contracts. Cardiovascular disease continues to be one of the biggest killers in the US. Couple that with an aging population, and it’s safe to say that the need for cardiologists will persist despite the temporary blip posed by COVID-19.

The small number: -25.33 percent

Family medicine physicians saw the biggest dip in their signing bonuses at 25.33 percent year-over-year. The average new FM physician brought in $30,000 with their new contract. The Health Resources & Services Administration projected that by 2020, demand for primary care physicians, such as FMs, would outpace supply. This government office expected a 14 percent increase in demand, and a projected shortage of more than 20,000 full time employees. 

The top-five signing bonus gains by specialty (year-over-year change in parentheses)

  • Cardiology: $27,500 (+131.58%)

  • Urology: $47,373 (+69.20%)

  • Psychiatry: $35,625 (+49.21%)

  • Internal Medicine: $30,000 (+27.50%)

  • OB/Gyn: $37,500 (+20%)

The top-four signing bonus declines by speciality (year-over-year change in parentheses)

  • Family Medicine: $30,000 (-25.33%)

  • General Surgery: $27,500 (-20.16%)

  • Gastroenterology: $25,000 (-18.77%)

  • Neurology: $32,500 (-16.24%)

As the Medicus Firm report notes, COVID-19 cast a pall of uncertainty over the entire healthcare business. It froze elective procedures, cost healthcare systems billions in lost revenues, and deterred patients from seeking care. That being said, the needs of American healthcare consumers are unchanged, as is the American physician shortage. 

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