Employed Doctors Earn More Money Than Independent Physicians

Employed Doctors Earn More Money Than Independent Physicians.

The percent of doctors who are now employed by hospitals has increased from 25% to 51% from 2012 to 2022.

One potential cause of that trend is that doctors employed by hospitals systems can make more money than independent physicians.

A survey by the American College of Cardiology found that cardiologists employed by hospitals made $645,388 per year, while independent cardiologists made $588,272 per year.

Additionally, incomes of employed cardiologists rose by 4% from the previous year, while the incomes of independent cardiologists fell by 2.7%... so the income gap is widening.

The reason that doctors employed by hospital systems can make more money than independent physicians is because employed doctors can have their income additionally subsidized by the hospital facility fees that they generate by ordering tests and performing procedures.

The Stark Law was intended to prevent these hospital 'kickbacks' to doctors, but physician employment effectively circumvents this spirit of the Stark Law.

Sources:

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[lyonelcarre]

Employed physicians pay a higher tax rate, hence it is either a wash or the self employed still take more home

[lylpbce]

Being employee is less headache. Also, doesn't to deal with billing, insurance, and prior authorization. Hospitals have more support staffs.

[chrislee]

Thanks for the great video. Do you think there will be similar trend for surgical specialties?

[thatwasinteresting]

For now. But you are no longer viewed as a professional but just another line item on a spread sheet that needs to be "managed". As the system gains more power they will cut salaries, increase patient load and diminish doctor independence. I have seen it in the area where I work. Physician morale is at an all time low. Older experienced doctors are retiring in droves and younger ones are only working part time. If a physician strays from the Hospital's guidelines they are usually harassed and brought into "compliance" even if it hurts patient care. Physicians are slowly being replaced by APNs and other "providers".

[AnthonyJarrah]

But if you're an employee then you get a W-2 and in that tax bracket you lose way more money than if you were an independent physician writing off all of your expenses. An independent physician can make way more money by using tax advantages to self employed business owners.

[AnishKumar-emd]

Is this situation different for independent physicians who own and operate in private facilities? I was under the impression that in that scenario they are able to recuperate the facility fees.

[tuvale]

very interested to hear your thoughts on California's ban on physician employment

[NuestrosVinos]

Your assessment is incorrect and there are so many variables to come to that conclusion. Independent physicians have more freedom and tax advantages than a hospital employee. It really depends on the market you are working. You can actually earn less but bring more home. Stress test 2, 200?