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The Covid epidemic which paralyzed the world economic system also had its impact on the medical profession. The income earned by medical practitioners differs not only by their particular specialty but also by the source of employment (self-employed in practice or employed by a hospital) and also by gender.
Key determinants of Specialist Pay
As in the case of all products and services, the pay earned by different doctors and specialties is a function of demand and supply. In the case of employed physicians, the income earned is capped by the remuneration packages and incentives set by hospitals and healthcare institutions.
Demand for specialty care is driven by factors including:
- increased incidence of the disease (like cancer, heart disease, and vascular diseases during the epidemic),
- accessibility of the specialist, quality of patient care, the success rate of the specialist,
- the number of patients serviced (states with large populations and several healthcare options generate lower revenue per specialist)
- the demographic profile of the population (the USA has a greater proportion of the ageing population with greater medical requirements of access to healthcare),
- lifestyle and dietary habits of the population,
- inflation trends in the economy,
- the position of the economy or the state in the business cycle,
- popular fads in vogue (particular important for plastic surgery carried out for cosmetic purposes)
- Evolving Healthcare regulation like the Affordable Care Act which caps Physician’s pay to mention a few.
Supply would depend on:
- the number of newly graduating specialists into every stream,
- transfers of new specialists to the area,
- the experience, the qualifications, knowledge and renown enjoyed by a particular specialist,
- the number of specialists available in a particular discipline
- insurer’s pay per performance packages and
- The demand for specialists in a particular stream of specialisation.
Surgical disciplines, as they require more skill, knowledge, and experience; command a premium compared to specialists in chronic disease treatment, non-urgent care, and other general physician disciplines. There is no discipline that has a permanent position at the top of the ladder but it is a rotating scale. 2020 witnessed a large demand for vascular specialties, urgent patient care, and other disciplines which were required for the treatment of Covid-19 while the requirement of more traditional discipline services was deferred.
Medscape and Doximity Survey for 2020 and 2021
Distribution of Specialist Pay by Medical Discipline
In 2021, the distribution of income by specialists follows the more traditional distribution compared to 2020, which was skewed by the Covid-19 epidemic. It’s no surprise that surgical specialties attract the highest remuneration.
The distribution of incomes by specialties are as follows:
|Field of Medicine- Speciality||Ballpark income range in $ 100,000|
|Physical Medicine and Rehabilitation||300|
|Allergy and Immunology||274
|Diabetes and Endocrinology||245|
|Public Health and Preventive medicine||237|
Source: Medscape’s Average Annual Physician Compensation Report 2021
Highlights of the Medscape and Doximity Survey Report
The average yearly salary of a US physician is very difficult to determine. Income is influenced not just by the doctor’s specialization, but also by several other variables, such as the state in which they practice and their employment status, i.e., do they have their practice or are they hired by a medical facility or institution?
According to the fourth Annual Physician Compensation report, from the professional medical network Doximity, between 2019 and 2020, doctors’ compensation grew by an average of 1.5% p.a, compared to the 2.3% p.a.growth rate in 2019. The wage gap between genders was also adversely affected with an increase to 28% compared to the 25.2% in the previous years.
But while pay increases of many specialties plateaued, certain medical specialties like Vascular surgery, physical medicine, geriatrics, genetics, emergency medicine, and oncology all saw a pay increase of more than 4% in the average annual compensation between 2019 to 2020. One of the side effects of the pandemic was an increase in demand for specialists treating high-risk patients, patients with severe respiratory complications, and geriatric patients. Vascular surgeons earned an average of $535,000.
However, in 2021, we are seeing normalcy return in medical specialists’ salary with plastic surgeons topping the list at around $526,000. There are those medical sectors still affected by Covid with fewer patients and lower clinical hours worked. Specialists reigned supreme with salaries around $350,000 p.a. range according to Medscape’s latest report with employed doctors earning an average of $250,000 p.a. Female specialists earned 33% less than their male counterparts.
One of the reasons for this is fewer women were employed in the higher paying specializations. Surgery and other medical specialists earned more than chronic care specialists and physicians. State -wise disparity of incomes continued with Alabama paying an average physician salary of $348,000 and Minnesota coming the last with $296,000. About 22% of the physicians surveyed claimed a reduction in hours worked due to Covid-19. Some physicians switched to part-time work and about 2% were laid off. The dispersion of salaries in medicine is wide. The mean average salary is around $224,000 and the gender gap is persistent between male and female physicians and surgeons.
Women doctors have been unable to breach the glass ceiling of pay scales. Cities, states with their different living standards, and inflation trends cause further differences in remuneration. Self-employed physicians earn 20% more than employed physicians. For fledging doctors embarking on their new career paths, remuneration in different disciplines has shown pronounced improvement in 2021 as follows: in neurology (up 13%), non-interventional cardiology (9%), and pediatrics (up by 7%). Orthopedic surgery, internal medicine, and OB_GYN are showing a declining trend in 2021.
One of the new specialist areas which have come to the fore in 2020 and 2021 is Psychiatry. Mental health professionals are much in demand due to the fallout of the Covid-19. People facing job losses, the deleterious effects of the Covid-19 on themselves or their family members, deaths in the family have to additionally face depression or other mental health issues. In the U.S, for instance, there has been a sharp increase in the number of people with mental problems, anxiety, or substance abuse disorder due to job losses or other financial problems among young people. There has been a sharp increase from 4 out of 10 in 2020 compared to 1 out of 10 in 2019. This trend is more pronounced among communities of color, especially with Hispanic and Non-Hispanic Black adults. One of the reasons was also the challenges they faced in accessing the health care facilities.
In the Medscape survey, the surveyed physicians disclosed the total remuneration they got from hospitals for treating their patients. All employed doctors disclosed their salary, bonuses/incentives, and revenue from any profit-sharing agreements. While physician partners and those who practice alone reported their profits before income tax, company tax, and deductibles.
Variables that influence a doctor’s salary in the United States.
Employed vs. Private Practice
According to the most recent data, self-employed doctors make more than employed physicians, with self-employed physicians earning an average of $395K per year and hired physicians earning an average of $289K per year. According to an American Medical Association (AMA) study, the primary variation in how physicians get compensated is according to their ownership position, i.e., employee vs. private practice. The distinction is not in terms of salary, but rather in how physicians make a livelihood. Physicians working at hospitals, medical centers, and other comparable institutions, for example, claim salary as their primary method of payment. Although private professionals may be paid in pay, the number of self-employed physicians who are paid in salary is considerably smaller. According to the AMA study, more than 46 percent of employed physicians say that pay accounts for more than half of their income, whereas just 25.6 percent of business owners report the same.
Private Doctors’ pay is often based on their output. However, this is not to imply that the salary of hired physicians does not rely on productivity – it does, but far less than the income of their private counterparts. As anticipated, financial success was only significant in determining private physician pay; however, only 10% of private practice owners said that it was the only determinant in deciding their income.
So, how are private doctors compensated? A self-employed doctor’s income may be calculated after all company invoices and expenditures have been paid, just like any other private business owner. The doctor’s office sees patients, records their appointments, bills the patients or their insurance companies, and collects money. Assume a doctor’s practice earned $350,000 in one year. The whole cost of operating the company is $200,000 (rent, employee wages, leases, supplies, and so on). This implies that the practice’s owner or owners are left with $150,000 in earnings, which is subsequently distributed among them.
It is in the best interests of private clinics to see as many patients as possible each day. Their income is largely influenced by the number of people they visit and charge each day. Simply stated, a private practice office’s income decreases as the number of patients decreases. However, private practice has grown less common among doctors in the United States in recent years. According to the most current AMA statistics, just 47.1 percent of doctors in the United States are still in private practice. Let’s have a look at what’s causing this phenomenon.
Running a private practice as a physician is not an easy job. Most physicians get dissatisfied and weary of the rules and obligations that come with running a multimillion-dollar business. According to the most recent study, 26 percent of surveyed doctors said that the healthcare system’s rules and regulations are the most difficult aspect of their work. They must deal with their patients’ insurance companies and Medicare, as well as malpractice insurance firms that cover their company, in addition to dealing with workers and paying rent. For many people, working at a hospital offers security and a steady paycheck. Even while hired doctors are supposed to be very productive, their wages are not legally contingent on it.
However, this is also too simple. In the United States, hospitals have devised a safeguard against decreased physician output. Many hospitals in the United States have developed various compensation packages for their hired physicians to reward hard work done by doctors. The work relative value unit (wRVU) approach seeks to reward doctors for more labor or show passion, such as visiting more patients. In this manner, the revenue and income model of private practices may be found in bigger institutions – the more patients the doctor serves, the higher his or her salary.
Many healthcare organizations in the United States are now seeking to alter their compensation structures to comply with specific Medicare regulations, but it is difficult to envision the US healthcare system moving away from paying doctors based on the number of patients they see. However, a lot of emphasis is being placed on quality and efficiency, which implies that the value of care delivery will take into account more than just the quantity of patients treated. As you might guess, striking this balance is very tough. Pay in healthcare, like other business models, is mostly determined by productivity. The change in healthcare pay, on the other hand, aims to match production with quality of treatment.
Income Disparities by State
Doctors’ earnings are also affected by their condition of practice. You’d assume that states with the most people would have the greatest doctor salaries, but that’s not the case. Surprisingly, states such as New York and California do not even make the top ten list of states with the highest-paid physicians. This may be attributed to a variety of reasons. Large and economically developed states, such as New York and California, have a plethora of healthcare choices, giving people a plethora of options when it comes to selecting a healthcare provider. This implies that there are fewer patients per physician on average. As previously stated, the US healthcare system is predicated on wages depending on the number of patients treated, which is why areas with big populations and many healthcare choices have lower average revenue per physician.
While Kentucky, Tennessee, and Alabama are among the top-earning states for physicians overall, healthcare choices in these states are more restricted, with fewer doctors, hospitals, private offices, and other medical facilities. This implies that there are more patients per doctor than, say, in New York. Perhaps this explains why a physician’s average pay in Kentucky is higher: he or she serves more patients than his or her colleague in New York, where there is greater competition for patients. As a result, Kentucky has a higher average physician salary than New York.
Income Disparities by Specialty
In the United States, primary care practitioners make an average of $297K, while specialists earn an average of $357K. I’ve previously given you a list of the top paid physicians in the United States based on specialization. The table may be seen at the beginning of this blog. So, why does a doctor’s compensation depend on his or her specialty? Simply stated, certain specialties require greater expertise and, as a result, more training. As you can see from our list, surgical specialties such as orthopedics, cardiology, radiology, and plastic surgery pay some of the highest salaries in the United States. These procedures-based specialties require 5 or 6 years of extra residency training after graduating from medical school. These specialties are also more likely to need post-residency specialized training, such as fellowships. As a result, these experts get paid more.
Primary care specialties, such as family medicine, internal medicine, pediatrics, and so on, are relatively less competitive. With that said, the demand for PCP is only increasing. One of the advantages for primary care practitioners is they accrue less debt. After 7 years of medical education and training, one may become a practicing family physician (4 years of medical school and 3 years of residency).
When it comes to specialization, you should also consider the demand in the healthcare industry. A rise in pay or wages depending on specialization is frequently a sign of scarcity in that field.
Salary Differences Between MD and DO
While DO and MD doctors earn similar salaries when practicing in the same field, DO practitioners have fewer specialty choices. DO and MD graduates are equally competitive for primary care specialties like family medicine, according to the most recent Main Residency Match statistics, with 1,392 DO seniors and 1,543 MD seniors matching last year. DOs, on the other hand, are underrepresented in the lucrative surgical specialties we’ve discussed. For example, 23 MD seniors were matched to a dermatology residency, one of the most competitive residencies in the US, while just 6 DO seniors were matched to the same specialty. Another example is orthopedic surgery, which has 686 MDs matching versus 112 DOs matching.
While there is still a disparity in the statistics, you should be aware that there has been a significant rise in DO representation in surgical, competitive specialties. This is mostly due to changes in residency program accreditation. Previously, osteopathic and allopathic residencies were recognized by separate organizations: the former by American Osteopathic Association (AOA), and the latter by the Accreditation Council for Graduate Medical Education (ACGME). Both DO and MD programs are now ACGME-accredited, giving osteopathic residency programs the same status and possibilities as allopathic schools.
Furthermore, the same accrediting system enables DOs to participate in MD programs (as long as they meet all of the criteria, including as passing the United States Medical Licensing Exam) and MDs to participate in programs with “Osteopathic Recognition” designation (also with the condition that they fulfill all the requirements that differ by program).
Simply stated, the single certification system is bridging the DO-MD residency divide. The population disparity between DO and MD inhabitants is expected to narrow over time. However, keep in mind what DO stands for: DOs have a certain mindset that drives them to seek primary, non-intrusive medical care specialties. While DOs are definitely capable of becoming surgeons, their beliefs continue to influence their specialties and the location of the practice. This implies that the wage disparity between DO and MD may persist.
In the post-Covid world, Medical rules and regulations have increased. A large part of the doctor’s time is spent dealing with EHR regulations, paperwork, and administrative work. Government regulations impose ceilings on doctors’ pay which further burdens doctors. Learn about the best side hustle for a physician powered by medical market research offering paid medical surveys.
If we can agree that human life is the ultimate frontier then consequently, physicians are leading the charge.
On the positive side, technological improvements and medical breakthroughs bring to the fore new treatment mechanisms. But ultimately it is down to the skill of the doctors and medical professionals. The medical profession is one of the noblest professions and the most challenging at the other end of the spectrum. Doctors are exposed to lengthier and tougher education compared to other professions. Even the work of doctors involves a level of difficulty higher than other professions. After all, it is the collective skill of many doctors and nurses that helps save lives.
But, despite the challenges and the risks of medical practice arising from exposure, medical practice is a rewarding profession. Doctors save patients every day and make lives better. After all, how can one attribute a monetary value to saving or preserving a life?
2 thoughts on “Highest Paid Medical Specialties 2021-2022”
As faculty at a Family Medicine residency program, I can tell you unequivocally that a Family Medicine residency is a 3 year program after medical school- just as are most general internal medicine and pediatrics residency programs.
Thanks for verifying.
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