By Dr. James M. Dahle, WCI Founder
One of the funnest parts of running The White Coat Investor is the opportunity to peer into the nitty-gritty details of the financial lives of other doctors. It's a little bit like practicing emergency medicine that way—a bit voyeuristic but often entertaining and always interesting. People always want to know how much doctors make, but one of the things I have noticed, that no one ever seems to talk about, is that intraspecialty pay variation is higher than interspecialty pay variation. Let me explain what I mean.
How Much Does a Family Doctor Make?
Take a look at this salary survey from Medscape on the medical specialties broken down by salary(and show it to your med students, apparently 3/4 of docs are never shown something like this in med school):
The casual viewer looks at this and says, “Cardiologists make almost twice as much as family practice docs. I want to be a cardiologist.” But once you've been in my shoes, you look at this and say, “Wow, some family practitioners make more than the average cardiologist. I wonder how they do that?” Look at the variation here: the difference between an orthopedist and a pediatrician is $279K a year.
Compensation Ranges for Emergency Medicine Doctors
Now check out a specialty-specific salary survey, from my specialty of Emergency Medicine. This one is from 2015, so not quite up to date but it will work to illustrate my point:
Look at the 10th percentile for employees—$213K. Now, look at the 90th percentile for partners—$510K. Difference? $297K. GREATER than the difference between the average pediatrician and the average plastic surgeon!
The ability to increase pay, and increase it substantially, solves a ton of financial problems that real doctors run into and email me about all the time. It's way easier to pay off your student loans or mortgage on twice the income. Even after-tax, it's much easier to become financially independent or have a dignified retirement or send your kids to the college of their choice when you can double your income. The bigger the hole you are in, the more interested you should be in this topic.
So today I thought I would do a post all about intraspecialty pay differences. But frankly, none of you readers are interested in hearing about the average earner in your specialty, much less the low earners. You want to know how those who are really killing it are doing it.
I trolled around in the WCI Facebook Group until I got a few nibbles. Then I reeled them in with some emailed questions. I considered doing this on the podcast, and maybe still will, but it was a bit tricky to get people willing to come on the podcast and give us the straight scoop without the anonymity I can provide in this blog post.
Before we get into their comments, though, let's discuss a few ways to increase your physician income.
How to Make More Money as Family Medicine Physician
In January 2020, we ran a guest post from Gerardo Bonilla, a family medicine physician in Woodland, California. Dr. Bonilla is the founder of StatNote and author of StatNote: Dot Phrases to Expedite Your Medical Documentation. His company provides tools that facilitate medical documentation so doctors can enjoy seeing patients and get fair compensation while doing so. We have no financial relationship. Here's what he wrote about how to increase your primary care physician income.
#1 Preventive Medicine
The annual physical is falling out of style, at least in adult medicine. But insurance companies pay for preventive care for a reason. An ounce of prevention is worth a pound of cure. Some doctors sprinkle health maintenance throughout their patient’s visits, but an annual physical ensures that your patients get all the evidence-based screening and disease prevention recommendations.
According to the AAFP, the average payment for the preventive visit is 25-percent higher than for the problem-oriented visit.
Just by doing preventive medicine, and billing for it, you could see about a $70,000 annual increase in revenue in your practice while ensuring better patient care. (Take a look at the comparison of Physician A and B in this article from the FPM (Family Practice Management) Journal and calculated revenue on the table below.) You don’t need to see more patients. The patients are already coming to your clinic. You just need to spend more time with them.
However, spending more time with each patient and providing more services means more documentation. Having templates or using dot phrases in your electronic health record (EHR) will help you effectively chart all the onerous documentation requirements. This is especially true if you want to meet the ones required to bill for a Medicare Wellness visit.
Conduct a wellness visit and, when appropriate, conduct a problem-oriented visit at the same time. Most patients have chronic problems to discuss at their wellness visits. CMS allows physicians to report both the problem-oriented visit and the wellness visit at the same time, and the revenue implications of reporting both services are significant. [Editor's Note: Note that patients on a high deductible plan who thought their visit was going to be free even though they also talked about their problems might not be so pleased, however.]
The burden of medical documentation is the main cause not only of physician burnout, but also of frustrated patients who only get five-minute visits with their doctors. That is why optimizing your documentation is strongly encouraged.
This is where your dot phrases come in handy. They enable you to expedite your medical documentation and spend less time in front of the computer. Therefore, you can spend more quality time with your patient. Your patients will love it. They will think you are an old-school doctor with good bedside manners.
By using dot phrases and templates, physicians can capture the essentials of the visit with minimal effort. You can document what actually goes on in the exam room instead of selectively picking from the laundry list of problems the patient presents at the visit.
#2 Practice Full-Spectrum Medicine
Have you thought about doing some inpatient shifts or working at an urgent care? Maybe being the medical director for a nursing home or being on-call coverage for OB? Having work outside of the clinic obviously increases your income, but it is also a nice change of pace that might give you some sanity and time away from the never-ending inbox.
Practicing full-spectrum family medicine is rare now, but there is no reason why you shouldn’t practice at the top of your license, spending less time doing clerical work and more time taking care of the patient. You can practice at the top of your license by using your training and expertise to take care of patients.
This is sometimes limited by time. We often don’t have the time to do that joint injection or remove that mole, so we end up referring the patient to a specialist, adding to the fragmentation of care and the burden of healthcare cost—not to mention wasting the patient’s time.
By carving out some time to make room for these and other minor surgical procedures, you will see an increase in your practice revenue. Using dot phrases and templates helps you by giving you more time to do this. Check out this study that found that for every hour of direct clinical facetime with patients, doctors typically spend two additional hours on EHR and desk work within the clinic day.
#3 Know Your Coding
If you want to get better at billing, you need to get better at coding. Know the rules of the game inside out. Read the AAFP’s FPM Journal and the FPM’s Blog Getting Paid. They are a great starting point.
Other good resources are Optum360 EncoderPro and the AMA CPT Professional book. They are good reference tools when you want to get the right CPT code for your procedure. You can also have favorites saved in your EMR for your most frequently used E&M and CPT codes used for billing. It will save you time.
Physicians routinely undervalue services they are already providing. Taking a coding training course might help you become more confident in the worth of the work that you are doing.
There are many courses available out there. For example, the E&M CodeRight® course by MediSync can help you gain a clear understanding of the key components needed to calculate the level of coding. [Also consider the WCI partner Medical Coding and Billing Course.-ed]
As part of the quality strategy to reform how healthcare is delivered and paid for, CMS is implementing initiatives to assure quality healthcare. These value-based programs reward healthcare providers with incentive payments for the quality of care they give to their patients. Your group may receive annual incentive payments from insurers based on quality measures that are used to calculate that pay.
It’s important to pay attention to any quality incentive measures that you may have in your office, as this might represent a bonus in your salary. This might mean documenting or clicking the right box for your diabetic foot exam and ordering an annual microalbumin lab, recording in the EHR that controlled blood pressure reading from home, and making sure you don’t prescribe an antibiotic if your ICD-10 code is acute bronchitis. If these ensure you a $30,000 quality bonus in your paycheck, for example, suddenly it doesn’t become an annoyance anymore.
#4 Optimize Your Medical Documentation
Being more efficient at documenting your progress notes can have a huge impact on your time and therefore could potentially enable you to increase your income. Practicing at the top of your license, doing preventive care, minor procedures, or work outside the clinic are ways to maximize that revenue.
By reducing time in front of the computer, you can spend more time with your patient. For example, you can take the time to do Advance Care Planning with your senior patients, counseling on tobacco and alcohol use, or even do psychotherapy with your depressed and anxious patients. All of these counseling services should typically be reimbursed if they are properly documented.
Comprehensive care and doing what is best for your patient and for the healthcare system will also be the best for you. This will ultimately increase the joy of practicing medicine and enable you to be a Rockstar Doctor!
How These Doctors Made More Money
OK, back to our volunteers from the Facebook group. I have four docs from three specialties—family practice, pediatrics, and med-peds, all of whom are making 2X+ the average for their specialty. I asked them all the same questions and, with minor edits, I'm posting the answers they sent me. If you are a doc or other high-income professional in what is supposed to be a poorly paid field and are making 2X+ the average, please post your tips in the comments section after the post
#1 Pediatrician Making $430K
and you can play along at home!
No, I haven't verified any of this, and no, I cannot promise they will answer the additional questions about their lives that I'm sure you'll post in the comm
ents section. But this I can tell you—these people exist in every specialty. If you want to have an income like theirs, I would suggest doing at least some of what they do that is different from what you are doing now.
Our first volunteer is Mike, a pediatrician who made $430,000 (>2X the average above) in 2018. He averages 8-9 hours a day, four days a week, 50 weeks a year. Like many pediatricians, he works longer in winter than in the summer and takes q13 call plus 8 Saturday mornings a year. No inpatient work. He came out of residency in 2013 with $65K in student loans (actually paid them off the day before responding to my email).
Mike is a partner in a 10-doc partnership with three part-time MD employees and four NPs. Seventy people total work in the practice, many part-time. About 20-25% of patients are Medicaid (no cap), the rest private insurance. Mike does not do many procedures, mostly circumcisions and ear piercings which are all cash pay, but he feels that really doesn't make a big difference in his income. He sees 25-35 patients a day.
What Have You Done to Increase Your Physician Income?
“For me personally, I bought into the private practice. This allowed me to increase my income from an employed physician to a partner receiving partner salary and taking part in the profit sharing.
We as a practice own the properties, as well, so I collect rent on the properties. I think we are a very efficiently run practice and a busy practice. I see 4-6 patients per hour. I see 2-3 well visits an hour. My billing is good and my documentation supports my billing. We do a developmental or mental health screening at every single well visit starting at 2 months old through 18 years old. We check hearing and vision at every single well visit. We are part of purchasing groups which help us negotiate vaccine prices. We have a partner who is very good at making sure that we are achieving PCHM level 3, and other metrics to prove that we are good at what we do which in turn allow us to go to the insurance companies and negotiate better payment for our work. Our A/R is good, we keep credit cards on file, are very good at collecting copays at time of visit.
Our biggest expense is staff. We pay fair rates for our staff, but also demand that they work hard for their money. We do not have excess staff and think very hard before hiring another person or creating another job to be sure that the roles that are needed cannot be completed by another staff member. When we add another service we ensure that it will be revenue generating. We invested time and money into a new system for appointment reminders so that we are sending text and email reminders frequently to decrease our no-show rate by over 1% in the past year going from 4.5% to 3.5% (which is a huge amount of money). We bring patients back for rechecks frequently (I don’t think excessively or inappropriately, though). The key is to keep our schedule full. If it is full, then we are doing well. During the summer if there isn’t as much sick, then we get creative and add more well visits.
Partners are paid solely based on their RVU’s so I am very incentivized to be busy. Other partners are not as busy as me, so they don’t get paid as well. There are other partners that are more busy than me and make maybe $30-40K more per year.”
#2 Pediatrician Making $450K
Our second volunteer wishes to remain anonymous but is also a primary care pediatrician who makes $450,000 working 32 hours per week over four days and 47 weeks a year. He also takes call 4-5 times a month. He is 22 years out of residency and paid off his $40,000 in student loans over 3 years.
He owns his practice with three physician partners and has two doctor employees, two NP employees, and 35 others. He sees 50% Medicaid, 45% HMO/Private Insurance, and 5% self-pay, but feels no control over that mix as they are the largest practice in the county. They attend high-risk deliveries at two hospitals and stabilize critically ill newborns prior to transfer, but their office procedure mix is pretty standard among pediatricians. He sees 25-30 patients per day.
Why Is Your Income Higher Than Average?
“One main reason my income is higher than the average pediatrician in the region is because of the high risk deliveries we attend. We have a contract with the 2 hospitals that pay us (as independent contractors) in addition to our office reimbursement.”
#3 Family Practice Doc Making $415K
This anonymous family practitioner came out of residency in 2016 owing $375,000 in student loans. He is an employee of a 501(c)(3) hospital and made $343,000 in 2018 and expects to make $415,000 in 2019 working 42 hours per week over four days and refuses to sign into his EMR on his weekday off. He works 44-45 weeks/year and takes phone call every weeknight for his 2,700-patient panel, then rotates weekends for group call every 5-6 weekends. That usually works out to 2-3 phone calls during the week and 5-10 on weekends.
He is on an RVU compensation model but thinks the payor mix is 60% private and 40% Medicare/Medicaid. He accepts all new patients into the group of patients he inherited from a prior doc. He averages 23 patients per day and does “more procedures than average. I perform a lot of derm procedures (biopsies, cyst, and lipoma removals), cryotherapy, joint injections (subacromial, knees, trochanteric bursa, carpal tunnel, trigger point), ganglion cysts. I also perform vasectomies.”
What Have You Done to Increase Your Physician Income?
“I have spent a lot of time learning my EMR (Epic) and how to make my day as efficient as possible. I use MModal to dictate. This has really helped with work after hours. I start at 7:30 each day and my last patient is at 4:30. I am out the door heading home with all my charts closed and paperwork completed by 5:15 pm. My partners and I have monthly meetings to discuss issues with our staff and how to become more efficient. From the front office staff, phone staff, and clinical staff, we identify gaps in care. Our goal is to have everyone practice at the top of their license. If a nurse is doing something an MA is capable of doing, we take that responsibility and give it to the MA. If a physician is doing something a RN is capable of doing, again, we take that off the doc and assign that to RNs. This helps keep us physicians busy seeing patients and doing procedures and not get bogged down in prior authorizations, FMLA/disability paperwork, phone calls and other things.
I think the main thing that has helped my income is developing the mindset that when I am at work, I have come to work. I love my job and love seeing patients, but if I'm spending time away from my family I am not there to waste time. I want to see patients. My template is 15 minutes for follow-ups and 30 minutes for new patients and annual physicals/medicare wellness visits.
I realized early on that one of the most annoying and interrupting things in my day was when patients would show up late. I would still try to squeeze them into my schedule so I wouldn't miss out on the RVU and to avoid inconveniencing them. After a while I realized by working late patients into the schedule I was making all my other patients that day upset because I was then running behind. They were upset; I was upset. It was causing a lot of stress trying to please everyone. I then realized that if I set a ‘late policy' and held to it, patients would eventually get on board and realize the importance of being punctual. I set my policy at 10 minutes. If they arrive after 10 minutes, they have to reschedule. If they arrive before 10 minutes, I'll agree to see them but they have to be willing to wait until I have time. I see the patients who arrive on time first. Managing my schedule has been very important for me to increase my efficiency.
I think the other main factor is learning how to bill. I think a lot of PCP's underbill. I'm not sure if it's because they don't take the time to learn the difference between a level 3 vs 4 vs 5 or if they are just nervous that they will be audited so they bill everything a 3. My hospital does a voluntary audit every year and my audit passes every year. I know the difference between office visit levels and I document accordingly. There is no award for seeing a complex patient and then billing a level 3. If you do the work, get paid for it. It's not easy to manage 3-4 chronic medical problems and address 2-3 new complaints in 15 minutes. I think providers don't necessarily need to document more, they just need to document smarter.
Combining E&M visits with procedures makes a huge difference as well. A level 3 office visit for an established patient is 0.97 RVUs. A level 4 is 1.5 RVUs. A joint injection/biopsy/cryotherapy is about the same RVU as a level 3 visit but takes just an extra minute or two of my time. I have established protocols with my staff so when I want to do a procedure, I just tell them what I plan to do and then go in to see my next patient while they get everything set up as I've instructed. I can then just pop back in to do the procedure and wrap everything up. EMR's then make it convenient to add the appropriate procedure template to the office note which completes the documentation.”
#4 Internist Makes Half a Million
“Dr. Solo” is a med-peds doc who made $500,000 in 2018 working 35-40 hours/week, 45 weeks/year. He is “always on call” with the solo practice he owns but never goes to the hospital. Call is about three after-hours calls per month. He is 12 years out of residency and still owes $50,000 of his original $150,000 3.25% student loans.
He employs no APCs, and is down to two employees from the 4-5 he had before transitioning to a subscription-based practice. His patients are 85% private, 10% Medicare, and 5% Medicaid, but he hasn't actually taken insurance since 2011. The patients who stayed with his practice generally have PPO-type plans and he is out of network on those. He does no procedures and sees 5-6 patients per day. No, there is no typo in the previous sentence.
Why Is Your Income Higher Than Average?
“I transitioned out of accepting insurance, acquired knowledge in integrative medicine and nutrition to develop a niche, changed to a membership-based practice, and cut overhead, i.e. from five employees down to two. I am passionate about spending the appropriate amount of time with each patient, enough time to allow me to best understand and treat not only their physical/medical problem(s) but the interdependent psycho-social and lifestyle choices (i.e. diet, exercise, sleep habits)—and I keep this tenet at the forefront of every decision to optimize the practice.”
As you can see, it is entirely possible to go into a primary care specialty AND make a lot of money. The key is the same as with any business—those who own a well-run business make more money than those who own a poorly-run business and those who are employed. So rather than crying “woe is me, I can't get rich because I'm a pediatrician” or worse, not going into family practice because you think you can't make enough to pay back your student loans doing so, do what these docs did and create your own destiny.
What do you think? If you are in primary care, what have you done to increase your income? What are your tips for your peers to go from the 25th percentile to the 75th percentile for your specialty? Comment below!