Crazy Pathology Wage Inversion, this is unsustainable

[LADoc00]

Currently Locums providers have literally not changed the daily pay rate for general surgical pathology from the last 15+ years: $1000 per day.

For an 8 hour day, that would be $125 hour.

From locum physician pay websites, the per hour rate for locums is typically a minimum of $20 more per hour up to $50 more than the salaried physician of the same specialty.

This would indicate that the typical new trainee should expect roughly a high end per hour of 105, roughly equating to a $218,000 salary per year.

Yet people and my own experience is that new graduates looking for 50% more than that starting.

How is such wage inversion possible? And is this a situation in locums being paid perhaps far too little, with a new normal rate of 1500-2000+ per day or new trainees looking for far more money than the market is paying atm?

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[caffeinegirl]

I would suggest that the market is the locums rate, and that new trainees are not aware of this. Locums in my area (which is SF bay area) has been posted at 900/day. This is laughable with the cost of living here, but that's what it is due to the fact that they will get people to fill the position. It's an oversupply, plain and simple.

 

[Unty]

I would suggest that the market is the locums rate, and that new trainees are not aware of this. Locums in my area (which is SF bay area) has been posted at 900/day. This is laughable with the cost of living here, but that's what it is due to the fact that they will get people to fill the position. It's an oversupply, plain and simple.

Thanks for providing further proof of the oversupply we have. It’s sad for trainees who have to go through 5-6 years of training and enter a job market like this.

 

[Alteran]

It’s all coming to a head eventually. At a minimum, the word is out with US med students. Pathology is the only categorical training program that is actually declining in how many US med students are going into it. Don’t believe me, look at the match data because the numbers don’t lie.

 

[Unty]

It’s all coming to a head eventually. At a minimum, the word is out with US med students. Pathology is the only categorical training program that is actually declining in how many US med students are going into it. Don’t believe me, look at the match data because the numbers don’t lie.

Yup and academics are blaming SDN for it! They just don’t like to hear anecdotal evidence from the many private pathologists who post here saying markets are saturated (meddirector, caffeinegirl, potato) or people saying they have few offers or have to work in undesirable cities.

If you have trouble finding a job or get a few interviews/offers, you are the “vocal” one or a “complainer” or a “weak resident” or “whiny” is what they think.

 

[Alteran]

Funny you mention academics. Anyone notice something rather conspicuous about these graphs, taken from the NRMP? This probably explains some of the nonsense.

 

[LADoc00]

None of this is making sense. How are new trainees getting anywhere close to 300-400K a year when you can hire an actual experienced solo sign out pathologist for HALF THAT? AND not pay any: payroll tax, benefits, time off, etc.

 

[caffeinegirl]

Maybe due to the poor job retention rate? I have heard from many of my peers about switching or losing jobs right before partnership, or due to merging or sale of labs. What is the attrition rate? Many of these entry level jobs are just that - a warm body until things change in the organization, or a way to keep people as non-partners.

None of this is making sense. How are new trainees getting anywhere close to 300-400K a year when you can hire an actual experienced solo sign out pathologist for HALF THAT? AND not pay any: payroll tax, benefits, time off, etc.

 

[qwerty89]

Wow. I get paid 100-125 an hour to babysit a CT/MR scanner as a resident.

 

[deleted314957]

Wow. I get paid 100-125 an hour to babysit a CT/MR scanner as a resident.

And?....... Is that good money?


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[Iceman24]

How are new trainees getting anywhere close to 300-400K a year

Where these numbers are coming from?
None of my former co-residents got paid more than 250K a year at their first job, during the last, let's say 5 years.

 

[dr4n6]

My experience is that LA Doc's numbers do not fully tell the tale of the Locums market. Very recently, I was offered $1500/day by one of the biggest name Locums agencies to do strictly forensics, which comparatively has always been reimbursed far less than any other pathology specialty. The salary figure offered to me is certainly way below what the hiring client was paying the agency, so the notion that one is going to be able to hire an experienced solo pathologist for less than a new hire is probably a bit off base.

 

[Guest8]

And?....... Is that good money?


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As a resident that would be amazing money. Far more than the typical $60K/yr (~$30/hr) residents make.

 

[Doormat]

My experience is that LA Doc's numbers do not fully tell the tale of the Locums market. Very recently, I was offered $1500/day by one of the biggest name Locums agencies to do strictly forensics, which comparatively has always been reimbursed far less than any other pathology specialty. The salary figure offered to me is certainly way below what the hiring client was paying the agency, so the notion that one is going to be able to hire an experienced solo pathologist for less than a new hire is probably a bit off base.

This is a perfect example of supply and demand. There is a BIG shortage of forensic pathologists right now. Therefore, the going rate for forensic pathology has gone up. The rest of pathology should follow forensic pathology's lead. Cut programs, cut spots and the job market and the $ value for pathology services will improve. Cut 601 US residency AP/CP spots down to 230.

 

[Thr0mbus]

This is a perfect example of supply and demand. There is a BIG shortage of forensic pathologists right now. Therefore, the going rate for forensic pathology has gone up. The rest of pathology should follow forensic pathology's lead. Cut programs, cut spots and the job market and the $ value for pathology services will improve. Cut 601 US residency AP/CP spots down to 230.

CORRECT. Even though local governments don't want to pay anything. THEY ARE FORCED TO PAY BIG MONEY WHEN THERE IS LIMITED SUPPLY!

 

[dr4n6]

Sorry Magic Man 72 you are dead wrong with your philosophy about local governments being forced to pay big money when there is a limited supply of forensic pathologists. As a practicing forensic/surgical pathologist for 25+ years I can tell you that while it is true that there is a significant need for forensic pathologists almost nationwide the salaries for most forensic positions are FAR below those of almost every academic/private practice hospital position and this has historically always been the case.

 

[Med Director New England]

Sorry Magic Man 72 you are dead wrong with your philosophy about local governments being forced to pay big money when there is a limited supply of forensic pathologists. As a practicing forensic/surgical pathologist for 25+ years I can tell you that while it is true that there is a significant need for forensic pathologists almost nationwide the salaries for most forensic positions are FAR below those of almost every academic/private practice hospital position and this has historically always been the case.

Are most pathologists with careers in forensic in a state or the federal pension system ? I think this is a yes but don’t really know.

 

[dr4n6]

Are most pathologists with careers in forensic in a state or the federal pension system ? I think this is a yes but don’t really know.

During my practice as a pure forensic pathologist working for either a state or county entity I was not a part of any pension system. I honestly don't know how common that may be.

 

[LADoc00]

I literally talk weekly with staffing firms. The locums rate of around 1K is right on the money.

Are the locums firms pulling a huge amount of cost off the table as their cut? Like are groups paying out 1500/day but the pathologists only seeing 1000 of that?

That is what Im unsure about. I talk to staffing firms but have never had to actually use their services fortunately.

 

[Unty]

Ive seen ads for $1200-$1300

I literally talk weekly with staffing firms. The locums rate of around 1K is right on the money.

Are the locums firms pulling a huge amount of cost off the table as their cut? Like are groups paying out 1500/day but the pathologists only seeing 1000 of that?

That is what Im unsure about. I talk to staffing firms but have never had to actually use their services fortunately.

 

[LADoc00]

I spoke at length to locums firms yesterday to make sure I didnt come here and post out of date nonsense from 3 years ago.

The current per diem rates are 800-1000 with some RARELY going higher for an experienced pathologist capable of solo sign out.

The issue is both sad and fascinating at its core.

1.) For one, the daily rate is predominantly set by large commercial labs like Ameripath, LabCorp, Aurora etc. They have set a rate of 800-1000 with another 400-500 going to the locums provider. Clearly, it pays far better to get a 400+ a day passive rate than to actually have to travel to some craphole and actually sign out cases. It would be orders of magnitude more profitable if pathologists actually just formed exclusive staffing firms and simply cornered the market THEMSELVES. This is doable because the total supply is actually not large by normal staffing metrics. But of course we are talking about pathologists here, probably the least business savvy of any physician so we are left with a horrible situation.

2.) Large commercial labs themselves were originally able to be formed due to the rock bottom daily rate they have been able to find pathologists. This is Captain Obvious, but clearly oversupply has directly impacted ALL pathologists not merely those on the bottom tiers willing to do daily rate work. From this has come multiple initiatives from CMS to clamp down on pathology reimbursement when people see large commercial lab CEOs make 50-60 million a year in pay.

3.) This 800-1000 daily rate has essentially created a hard market cap on the entry of new pathologists into the marketplace out of training. I simply dont see a market case for paying new grads more than 200 and perhaps as low as 150 if the position is fully benefited. But actually the math is even worse...

If you backed 800 per diem and deducted a 50/hr benefit cost, you are at 750 per day. If you then threw a calculation like the one used by large law firms where the expectation is a new graduate operates ONLY at 50% efficiency for a few years after training: $375 per diem. Then use a calculator to convert that to annual salary.
Final pay: $93,700

Let that sink in.

 

[caffeinegirl]

Just to add, I don't know if any of you received the Letter from the California Society of Pathologists, but the Anthem cuts are coming, and they are massive. Will definitely hit the bottom line.

Here are some examples of the rate changes, to give you an idea of their scale and scope across key CPT codes that are the "bread and butter" of pathology:​

See below for a message from the President of CSP.
February 20, 2020

Dear Colleague,

A few weeks ago, I wrote to you about dramatic cuts in reimbursement to pathologists recently imposed by Anthem-Blue Cross. A copy of that letter is available here. I promised to follow-up with more information about the cuts, and what they may mean to you, as well as what the CSP plans to do to fight this threat to your future income and independence as a pathologist.

To summarize the nature of the threat we are facing, consider the following:

• The reductions in payment for many common anatomic pathology procedures, like CPT codes 88305, 88307, 88341, 88342, and 87480, are to levels substantially below the Medicare fee schedule and in many cases, less even than Medi-Cal.
• These cuts were imposed unilaterally, without negotiation, or even, in some cases, notification.
• The greatest impact now is on independent pathology groups operating their own anatomic pathology labs, who have no protection if they are out of network. Thanks to California state law AB72 (which the CSP helped pass), a hospital-based group that is out of network with Anthem or any other plan, would be protected and paid at the greater of: plan average contracted rate or; 125% of Medicare.
• These new Anthem rates are in many cases below cost, and will make many independent pathology practices unsustainable.
• Right now, the damage is limited to those independent pathology practices that have a substantial book of business through Anthem.
• If this does not apply to you, you should still be worried – here is why:
• If these Anthem rates are allowed to stand, it is likely other insurers will notice, and it could trigger a “race to the bottom” in payment for pathology professional services.
• Accepting rates below Medi-Cal exposes pathologists to the “most favored nations” clause in state law that entitles Medi-Cal to the lowest rate a provider accepts, resulting in a drop in Medi-Cal payments too – a double hit!
• If you are a salaried physician at an academic center, large medical group, public hospital or in another setting, you are also at risk, because your compensation is ultimately also tied to that of community pathologists – to paraphrase, a “dropping tide lowers all boats.”

What can the CSP do on your behalf?

Our goal is to fix AB 72, the California Out of Network billing statute, so the law also establishes a floor in reimbursement for out of network independent labs, similar to the protections provided in AB 72 for hospital-based pathology groups. An effort like this requires resources to:

• Secure a legal analysis of options available to challenge the magnitude of the cuts implemented;
• Mount an advocacy effort to sponsor a bill to expand the protections of AB 72 to out of network pathology labs;
• Work with other medical specialties, the CA Medical Assoc. and CA Hospital Association to gain support for the needed changes;
• Retain a Public Relations firm to hone our message and arguments, outreach to publications to highlight the impact of payer actions like this, and how fixing AB72 can help;
• Conduct a grassroots campaign to coordinate outreach in writing and in person with members of key Legislative Committees.

The CSP Board has created a Pathology Defense Fund to provide the resources needed for this effort - this is an extraordinary threat, which cannot be addressed through your Society’s normal operating budget.

What can you do?

We are asking each pathologist (or their group) to contribute $1,000 per pathologist to the Pathology Defense Fund. This represents a significant commitment, but if you consider the potential impact of these new rates on your practice, we think you will agree that the time to act is now.

 

[path24]

Wow. The massive cuts are coming. Thank you academics and leadership (tell them to pay for the defense fund, they created this problem). Oversupply.

Pay is going down. Have an exit strategy. Glad I am not a resident.

 

[WEBB PINKERTON]

All it does is drive even more consolidation, overutilization etc. They taketh and you find a way to taketh back.

Definitely start businesses, buy rentals and get a plan B. You can make much more money outside of pathology. Remember you are one percenters and you can do it.

 

[LADoc00]

With current events as they are, I do not think there has been a better time in all of modern history for pathologists to simply stage a nationwide work stoppage.

Certainly, everyone should drop Anthem on ANY hint they plan to enact these changes.

 

[y2k_free_radical]

Just to add, I don't know if any of you received the Letter from the California Society of Pathologists, but the Anthem cuts are coming, and they are massive. Will definitely hit the bottom line.

Here are some examples of the rate changes, to give you an idea of their scale and scope across key CPT codes that are the "bread and butter" of pathology:​

See below for a message from the President of CSP.
February 20, 2020

Dear Colleague,

A few weeks ago, I wrote to you about dramatic cuts in reimbursement to pathologists recently imposed by Anthem-Blue Cross. A copy of that letter is available here. I promised to follow-up with more information about the cuts, and what they may mean to you, as well as what the CSP plans to do to fight this threat to your future income and independence as a pathologist.

To summarize the nature of the threat we are facing, consider the following:

• The reductions in payment for many common anatomic pathology procedures, like CPT codes 88305, 88307, 88341, 88342, and 87480, are to levels substantially below the Medicare fee schedule and in many cases, less even than Medi-Cal.
• These cuts were imposed unilaterally, without negotiation, or even, in some cases, notification.
• The greatest impact now is on independent pathology groups operating their own anatomic pathology labs, who have no protection if they are out of network. Thanks to California state law AB72 (which the CSP helped pass), a hospital-based group that is out of network with Anthem or any other plan, would be protected and paid at the greater of: plan average contracted rate or; 125% of Medicare.
• These new Anthem rates are in many cases below cost, and will make many independent pathology practices unsustainable.
• Right now, the damage is limited to those independent pathology practices that have a substantial book of business through Anthem.
• If this does not apply to you, you should still be worried – here is why:
• If these Anthem rates are allowed to stand, it is likely other insurers will notice, and it could trigger a “race to the bottom” in payment for pathology professional services.
• Accepting rates below Medi-Cal exposes pathologists to the “most favored nations” clause in state law that entitles Medi-Cal to the lowest rate a provider accepts, resulting in a drop in Medi-Cal payments too – a double hit!
• If you are a salaried physician at an academic center, large medical group, public hospital or in another setting, you are also at risk, because your compensation is ultimately also tied to that of community pathologists – to paraphrase, a “dropping tide lowers all boats.”

What can the CSP do on your behalf?

Our goal is to fix AB 72, the California Out of Network billing statute, so the law also establishes a floor in reimbursement for out of network independent labs, similar to the protections provided in AB 72 for hospital-based pathology groups. An effort like this requires resources to:

• Secure a legal analysis of options available to challenge the magnitude of the cuts implemented;
• Mount an advocacy effort to sponsor a bill to expand the protections of AB 72 to out of network pathology labs;
• Work with other medical specialties, the CA Medical Assoc. and CA Hospital Association to gain support for the needed changes;
• Retain a Public Relations firm to hone our message and arguments, outreach to publications to highlight the impact of payer actions like this, and how fixing AB72 can help;
• Conduct a grassroots campaign to coordinate outreach in writing and in person with members of key Legislative Committees.

The CSP Board has created a Pathology Defense Fund to provide the resources needed for this effort - this is an extraordinary threat, which cannot be addressed through your Society’s normal operating budget.

What can you do?

We are asking each pathologist (or their group) to contribute $1,000 per pathologist to the Pathology Defense Fund. This represents a significant commitment, but if you consider the potential impact of these new rates on your practice, we think you will agree that the time to act is now.

The BC BS Anthem rate in GEORGIA is already in place since last AUGUST and is only $24 for an 88305.I bitched about this for almost a year but few here seemed concerned.I wish i had your rates.----EDIT-Sorry,this is for PC only.

 

[WEBB PINKERTON]

Death knell for private practice. Put a fork in it. Hello health system employee.

 

[Spikebd]

Death knell for private practice. Put a fork in it. Hello health system employee.

Seems like it. I’m an optimist but man that’s brutal. Anatomic pathology outside of forensics looks like a real dead end career based off these posts.
maybe CP is the new land of milk and honey?

 

[Med Director New England]

Somewhere above LA did a little envelope math and came up at 94K being the truth worth of a path based on locums rate. That is amazingly close to what current instructors and the sign out fellow positions that are getting more prevalent at the big name places are paying for that one yr position right out of training. I know for some they are just getting the pgy5 or 6 rate for this position.

also these cuts on the 305 I still believe grew from a little acorn here in New England and has now grown into a small tree with branches. I’ve told this story before, but around 2009 BlueCross managed to get a contract with RI hospital for 305s PC at sub Medicare rate.I know at the sametime they were researching locally what Indy contracting paths (mostly derms) where charging per part for PC reads. The path dept at RIH basically shrugged their shoulders - they didn’t put up much of a fight b/c they were employed and the hospital mgmt told them not to worry you’ll be made whole by us. I still remember at alocal society meeting two senior pathologist getting into a heated argument over this. One was very pissed RIH agreed to this and was rightly worried about the precedent it could set.

hopefully this doesnt become a massive oak tree.

 

[y2k_free_radical]

Somewhere above LA did a little envelope math and came up at 94K being the truth worth of a path based on locums rate. That is amazingly close to what current instructors and the sign out fellow positions that are getting more prevalent at the big name places are paying for that one yr position right out of training. I know for some they are just getting the pgy5 or 6 rate for this position.

also these cuts on the 305 I still believe grew from a little acorn here in New England and has now grown into a small tree with branches. I’ve told this story before, but around 2009 BlueCross managed to get a contract with RI hospital for 305s PC at sub Medicare rate.I know at the sametime they were researching locally what Indy contracting paths (mostly derms) where charging per part for PC reads. The path dept at RIH basically shrugged their shoulders - they didn’t put up much of a fight b/c they were employed and the hospital mgmt told them not to worry you’ll be made whole by us. I still remember at alocal society meeting two senior pathologist getting into a heated argument over this. One was very pissed RIH agreed to this and was rightly worried about the precedent it could set.

hopefully this doesnt become a massive oak tree.

IT ALREADY HAS

 

[Guest8]

With current events as they are, I do not think there has been a better time in all of modern history for pathologists to simply stage a nationwide work stoppage.

Certainly, everyone should drop Anthem on ANY hint they plan to enact these changes.

We've been non-par with Anthem for years because of their stupid-low reimbursement. Unfortunately that's now turning into a tiff w/ our associated hospitals regarding surprise billing. Still working that part out, but when we showed how low Anthem was trying to pay compared to other insurers the administration was much more understanding.

 

[WEBB PINKERTON]

With health insurers buying up physician practices, I don't understand why Anthem doesn't purchase or start some pathology labs and route the specimens there. With the pathologist surplus it would be pretty easy to do.

 

[DoctorCancer]

BIG ACADEMIA YOU LOSERS HAVE SCREWED US OVER BIG TIME. WE HAVE NO LEVERAGE AT THE BARGAINING TABLE THANKS TO THE OVERSUPPLY.

OUR LAB CAN'T EVEN AFFORD TO OPERATE AT THESE PRICES.

FLEE PATHOLOGY NOW!

Here are some examples of the rate changes, to give you an idea of their scale and scope across key CPT codes that are the "bread and butter" of pathology:​

That's the stuff

 

[Torsed]

I did a locums gig in FL in the past summer b/c I had some free time. Took 1k a day plus rental car and hotel, hotel was middle of the road.

They cover your malpractice and flights. Even changed my flight to beat around a storm. Could have asked for more, but the job was cake. CAKE. Literally did about 4 hours actual "work."

Who knows. I had a partner at one time at my main gig, overpaid him and and the turkey still left for elsewhere (family reasons). The partner wasn't great, he was adequate. That is the level they are pushing out now. Who knows.

 

[Torsed]

With health insurers buying up physician practices, I don't understand why Anthem doesn't purchase or start some pathology labs and route the specimens there. With the pathologist surplus it would be pretty easy to do.

Why not. But who will do the frozens and run the BB?

 

[yaah]

How many locums path jobs are actually doing a heavy workload though? I am at a loss to explain anything regarding locums. We briefly looked into it when we had a brief time of ultra low staffing and the rates seemed astronomical. What are most locums jobs? Small rural jobs where you don't do much? Big reference labs where you do a ton of stuff?

 

[gbwillner]

I constantly get Locums calls. One time I was looking for some extra work and 3 years later I can't get off their call list. I did think about one offer that was made that was $1200 per day and another that was $4K per month for 2 days onsite. Both required me to fly to the location where airfare, hotel, and food were covered. Most offers were not that good but that's why I didn't consider them. When I asked for more money, the guy I was working with broke it down a bit. the agencies that run locums take like 25-30% of the rate. So if you are getting $1K a day, the practice is getting billed $1250-1300.

 

[Guest8]

How many locums path jobs are actually doing a heavy workload though? I am at a loss to explain anything regarding locums. We briefly looked into it when we had a brief time of ultra low staffing and the rates seemed astronomical. What are most locums jobs? Small rural jobs where you don't do much? Big reference labs where you do a ton of stuff?

We use locums occasionally to fill scheduling gaps for our group and we pay them well. But we give them higher volume than our staff pathologists and work them hard when they're here since they have no administrative duties or other tasks other than pushing glass for us.

 

[yaah]

• The reductions in payment for many common anatomic pathology procedures, like CPT codes 88305, 88307, 88341, 88342, and 87480, are to levels substantially below the Medicare fee schedule and in many cases, less even than Medi-Cal.
• These cuts were imposed unilaterally, without negotiation, or even, in some cases, notification.
• The greatest impact now is on independent pathology groups operating their own anatomic pathology labs, who have no protection if they are out of network. Thanks to California state law AB72 (which the CSP helped pass), a hospital-based group that is out of network with Anthem or any other plan, would be protected and paid at the greater of: plan average contracted rate or; 125% of Medicare.
• These new Anthem rates are in many cases below cost, and will make many independent pathology practices unsustainable.
• Right now, the damage is limited to those independent pathology practices that have a substantial book of business through Anthem.
• If this does not apply to you, you should still be worried – here is why:
• If these Anthem rates are allowed to stand, it is likely other insurers will notice, and it could trigger a “race to the bottom” in payment for pathology professional services.
• Accepting rates below Medi-Cal exposes pathologists to the “most favored nations” clause in state law that entitles Medi-Cal to the lowest rate a provider accepts, resulting in a drop in Medi-Cal payments too – a double hit!
• If you are a salaried physician at an academic center, large medical group, public hospital or in another setting, you are also at risk, because your compensation is ultimately also tied to that of community pathologists – to paraphrase, a “dropping tide lowers all boats.”

Thanks for posting this - for my education, why does it say the damage is limited to independent practices? Why wouldn't large centers and academic centers be impacted? It may not impact salaried physicians directly because they are salaried, but it would impact their department budget and such. If it's because the hospital based group may be out of network, would that start to fall under all of these "surprise billing" laws too?

Lots of questions, sorry. So much of healthcare seems like a race to pay as little as possible for everything while simultaneously increasing expenses and adminsitrative layers.

 

[Torsed]

How many locums path jobs are actually doing a heavy workload though? I am at a loss to explain anything regarding locums. We briefly looked into it when we had a brief time of ultra low staffing and the rates seemed astronomical. What are most locums jobs? Small rural jobs where you don't do much? Big reference labs where you do a ton of stuff?

When I did my locums gigs they must have knew I was coming because I had the 5 to 6 frozens on lung tumors and the 15 frozens on neck dissections and all the goodies in between. It was pure bananas. All at a 120 bed hospital. I think they stacked the cancer cases honestly.

 

[Kilgoretrout 65]

Seeing COVID-19 related elective procedures canceled and OR's close makes me wish I was getting Anthem rates....

So he went and hired himself out to a citizen of that country, who sent him into his fields to feed the pigs. He longed to fill his belly with the pods the pigs were eating, but no one would give him a thing .Finally he came to his senses and said, ‘How many of my father’s hired servants have plenty of food? But here I am, starving to death!