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Report from the Frontier of Physician Compensation

    how physician compensation is evolving

    With the rise in value-based payment, many medical groups have moved away from models that base physician compensation purely on production. Today, it is common to see physicians paid on a model that bases about 80 to 90 percent of take-home pay on productivity, with the remainder tied to imperatives such as quality, patient experience, and patient access.

    Among a small but growing number of organizations, however, a new trend is emerging: increased interest in paying physicians a guaranteed salary. While production remains a component in determining salary levels, the trend has important signal value about how medical groups' priorities are evolving—indicating a growing interest in incentivizing patient access and customer loyalty and in using compensation to mitigate physician burnout.

    This research report examines the emergence of this trend and profiles organizations that have recently redesigned physician pay around a salary-based model. It also considers key questions about the longer-term future of compensation—including the potential conflict looming as physician pay continues to climb while health systems focus on controlling costs.

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