Physician productivity has taken a big hit during the COVID-19 crisis, dropping by almost half across specialties in March and April 2020, according to new data and analysis from Kaufman, Hall & Associates, LLC, based on actual (not survey) data. However, a rebound in production has begun in May 2020 and continues into June.

What hasn’t changed during the crisis, however, is physician compensation. Even though productivity in 2020 is down compared with 2019, compensation was up slightly in 2020 until June which is down 0.75% compared to June 2019.

 

Year-Over-Year Comparison of Production and Compensation
Source: National Hospital Flash Report, Kaufman Hall

 

Providers with the biggest decreases in productivity are surgeons and proceduralists who were most affected by closures of ambulatory surgery sites, declining referrals, and patient reluctance to seek care this past spring. Of these specialists, gastroenterologists and non-Invasive Cardiologists had the most significant decreases in productivity. In June two primary care specialties also show significant sustained declines.

Specialties with the Greatest Decreases in wRVU Production

June VS Pre-COVID-19 Median

Gastroenterology

↓ 46%

Cardiology: Non-Invasive

↓ 38%

Surgery: Podiatry – Foot and Ankle

↓ 37%

Primary Care: Pediatrics General

↓ 36%

Surgery: Otorhinolaryngology

↓ 36%

Surgery: General

↓ 35%

Diagnostic: Radiology

↓ 33%

Family Medicine

↓ 31%

Surgery: Neurological

↓ 28%

Surgery: Orthopedic

↓ 26%

Yet a few specialists held steady this past spring. Ongoing obstetrical cases kept OB/GYNs busy during the crisis, while COVID-19 patients likely helped pulmonologists maintain stable volumes. Other hospital-based services, including infectious disease, had decreased production but not nearly as much as the surgical specialties.

Pulmonology: Critical Care saw a large 29% increase in production in June compared to pre-COVID levels.

For specialties whose volume continues to be significantly lower than per-COVID levels, unless patient volumes return and physician productivity rebounds, the current compensation model is financially unsustainable. In the short term, executives may need to rework their compensation plans until more patients seek care from providers. If productivity remains low, executives may need to restructure their clinical networks to better meet patient demand and stay financially viable.

Being responsive to the current environment and the impact on physician compensation for employed physicians will prevent a collapse in compensation for physicians with declining patient volumes. This limited term support can be offset with shared future repayment/forgiveness using aligned incentives focusing on access, quality, and cost.

Learn more about Kaufman Hall’s approach to managing physician compensation during the turmoil of COVID-19.

And look for more data and analysis on physician practices in future issues of Kaufman Hall’s National Hospital Flash Report.

 

For more information, contact Jim Pizzo at jpizzo@kaufmanhall.com.

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James-Pizzo

James Pizzo

Managing Director
Jim Pizzo leads operational, strategic, financial, and capital planning engagements, as well as merger and acquisition transactions for physician practices across the country.
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