MGMA 2007 Physician Compensation and Production Survey

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ampaphb

Interventional Spine
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Since I can't figure out how to post this in table form, please note that the four numbers in each category represent Mean, 25th, Median, 75th, and 90th percentile, respectively:

Anesthesiology: Pain Management

Overall
: $437,705 $337,500 $382,592 $500,000 $610,505

Eastern: $376,588 $337,500 $343,750 $489,286 $510,612

Midwest: $492,431 $341,417 $401,887 $576,078 $995,808

Southern: $480,190 $354,000 $354,000 $515,436 $933,231

Western: $416,908 $347,201 $395,523 $493,202 $663,947

Now you know why Algos and Gorback live where they live!

One other interesting piece of data which belies those who say you will be underpaid if you work with a group of orthopods or primary care docs:

Single Specialty: $415,617 $337,500 $354,000 $500,000 $548,534

Multispecialty
: $483,531 $338,474 $414,282 $510,517 $917,872

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Thanks for the info. Very helpful - but may want to put this under the physicians forum.
 
Can you post the pm&r salaries on the pm&r forum?
 
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Correction: I live where I live because I like sweltering in heat and humidity, whereas Algos lives where he lives because he likes to scrape 6" of global warming off his car every morning.

Notice how the median is far lower than the mean, suggesting a lot of skewing at the upper end of the curve.
 
it figures i chose the wrong location --- darn it ... but hey, my family is happy - and in the end, that is all that really matters.
 
what exactly are these physicians doing to earn over 900k ?!!!!!
 
[/I]One other interesting piece of data which belies those who say you will be underpaid if you work with a group of orthopods:

Single Specialty: $415,617 $337,500 $354,000 $500,000 $548,534

Multispecialty
: $483,531 $338,474 $414,282 $510,517 $917,872

This is usually the PM&R spine guys right? Do you think they are substantially represented in this data? I tend to think the numbers would be lower.
 
For the anesthesia guys, do you think these results are for those that split their OR and clinic time? Or are these salaries for clinic time only?
 
Does anyone have the salary numbers for anesthesia alone with pain medicine?
 
This is usually the PM&R spine guys right? Do you think they are substantially represented in this data? I tend to think the numbers would be lower.
for an equally productive doc doing essentially the same procedures and being reimbursed under the same CPT codes, why would you think they would be earning a different amount?
 
So here's the real question: Are those actual pretax, post-overhead dollars in doc's pockets or gross practice collections or somewhere in between?

Can some of the private guys vaguely comment on the perceived accuracy of these numbers and what they represent?
 
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So here's the real question: Are those actual pretax, post-overhead dollars in doc's pockets or gross practice collections or somewhere in between?

Can some of the private guys vaguely comment on the perceived accuracy of these numbers and what they represent?
Those numbers represent physician compensation.

The physician compensation to collections ratios are only reported for the Southern region, and there the median was 0.485

Median collections were reported, and they were:
Eastern: $527,209, Midwest: $674,873, Southern: $856,634, Western: $627,288
 
i would say they are accurate for the north-east...

unfortunately in most north-eastern states it is a lot more difficult to get CONs for facilities/ascs/MRIs/other ancillaries - so i wonder if the higher numbers in the south are both compensation for physician services AND ancillary revenue?
 
for an equally productive doc doing essentially the same procedures and being reimbursed under the same CPT codes, why would you think they would be earning a different amount?

Well, I'm assuming the multispecialty category reflects a small number of full service interventional pain docs, maybe in PCP groups.

I know of very few Anesthesia pain docs who work for surgeons. It's probably 90% or so Physiatrists who do this right? Do you think they were included in this survey? (Anesthesiology: Pain Management) I'm guessing the mean would be significantly lower if they were.
 
Well, I'm assuming the multispecialty category reflects a small number of full service interventional pain docs, maybe in PCP groups.

I know of very few Anesthesia pain docs who work for surgeons. It's probably 90% or so Physiatrists who do this right? Do you think they were included in this survey? (Anesthesiology: Pain Management) I'm guessing the mean would be significantly lower if they were.
When you asked this several posts ago, my response was "for an equally productive doc doing essentially the same procedures and being reimbursed under the same CPT codes, why would you think they would be earning a different amount?"

What is it about working with (not for) surgeons that would lower the pain doc's overall compensation? Higher overhead? (quite possibly, although you might benefit from greater avenues for marketing) Lower reimbursement? (unlikely, as these groups are of sufficient critical mass to be able to push back against third-party payers when it comes time to negotiate contracts). An insistence that you split your revenues with the larger group? (Some do this during your year or two before becoming a partner, but thereafter, you are able to share in the ancillary revenue streams.)

I may be wrong, but I believe you are extrapolating a generally lower starting salary for interventional physiatrists, and assuming the same applies once they are functioning in an eat what you treat structure. Personally, I see no reason, nor structural bias, which would justify such an assumption, but I am curious what you believe I might be missing.

My basic point is, there are good ortho groups, and bad ortho groups, just as there are good pain groups, and bad pain groups. The bias amongst the majority of those in private practice on this board tends toward solo practice (ie. Gorback, Algos). However, a number of you recently graduated fellows have done reasonably in single (drusso) or multi-specialty (Lig, Lobelsteve, myself) environments. PMR 4 MSK can speak to being a member of a large ortho group, but it is my impression that any of these arrangements can work quite well, so long as you go over the terms of your contract with a fine tooth comb with your attorney. Trust but verify.
 
My basic point is, there are good ortho groups, and bad ortho groups, just as there are good pain groups, and bad pain groups. The bias amongst the majority of those in private practice on this board tends toward solo practice (ie. Gorback, Algos). However, a number of you recently graduated fellows have done reasonably in single (drusso) or multi-specialty (Lig, Lobelsteve, myself) environments. PMR 4 MSK can speak to being a member of a large ortho group, but it is my impression that any of these arrangements can work quite well, so long as you go over the terms of your contract with a fine tooth comb with your attorney. Trust but verify.


I think you're right. However, there is a gray area in the physician compensation models when higher reimbursed providers mix with lower reimbursed ones in SMALLER multi-specialty groups. The traditional solution is to apportion the fixed and variable overhead costs per provider using some "boot-strap" formula. But, then you're likely to get into disagreement about what *your* overhead "really" costs. Some one is likely to feel like they're getting overcharged or undercharged relative to the amount of actual work they are doing.

Most physiatrists don't take call in the surgical specialty groups, though the group may get a stipend, manage a contract, or at least receive in-kind contributions from the hospital for doing these services. Should the physiatrist in the group get "a piece" of this action? The surgeons might feel like they deserve more (or the physiatrist less) because of the difference in on-call responsibilities and the nature of the work they perform.

Similarly, lets say a physiatric pain group wants to hire another pain physician. The most qualified applicant is from an anesthesiology background. The physiatry group also manages a couple of hospital-based rehab contracts. Financially, the contracts are loss-leaders, but it keeps the group in the good graces of the greater medical community and the work and on-call responsibilities have been traditionally divided equally among the exisiting physiatrists so that everyone's time and productivity is "taxed" appropriately.

The anesthsiologist would not share in any of these responsibilities with the group. Do you tax his income or productivity in other ways? How? You could flip the scenario around and make it a physiatrist joining an anesthesia-pain group who manages a small hospital anesthesiology contract. Or a pain neurologist joining an interventional radiology group that does after-hours over-reads for rural community hospitals...etc.

Linking compensation to RVU's is supposed to fix the problem, but it really doesn't because we know the RVU's are biased against E/M services. Besides, I don't think that the RVU system adequately captures the "emotional strain" of rounding on inpatient rehab patients...:) The RVU system was designed to mitigate the effects of payor-mix in *LARGE* multispecialty groups. Another solution (used primarily with mid-levels) is just to pay them a straight salary or hourly wage, but most physicians want compensation actually tied to productivity.

Thus, the compensation models get complicated when different providers are doing similar work most of the time, but completely different kind of work at least some of the time...You either have to except an element of a "socialistic" work ethic and hope that people don't get sloppy or keep things very "capitalistic" and hope that your less compensated workers don't feel over-exploited.

I would welcome alternative analyses....
 
When you asked this several posts ago, my response was "for an equally productive doc doing essentially the same procedures and being reimbursed under the same CPT codes, why would you think they would be earning a different amount?"

What is it about working with (not for) surgeons that would lower the pain doc's overall compensation? Higher overhead? (quite possibly, although you might benefit from greater avenues for marketing) Lower reimbursement? (unlikely, as these groups are of sufficient critical mass to be able to push back against third-party payers when it comes time to negotiate contracts). An insistence that you split your revenues with the larger group? (Some do this during your year or two before becoming a partner, but thereafter, you are able to share in the ancillary revenue streams.)

I may be wrong, but I believe you are extrapolating a generally lower starting salary for interventional physiatrists, and assuming the same applies once they are functioning in an eat what you treat structure. Personally, I see no reason, nor structural bias, which would justify such an assumption, but I am curious what you believe I might be missing.

My basic point is, there are good ortho groups, and bad ortho groups, just as there are good pain groups, and bad pain groups. The bias amongst the majority of those in private practice on this board tends toward solo practice (ie. Gorback, Algos). However, a number of you recently graduated fellows have done reasonably in single (drusso) or multi-specialty (Lig, Lobelsteve, myself) environments. PMR 4 MSK can speak to being a member of a large ortho group, but it is my impression that any of these arrangements can work quite well, so long as you go over the terms of your contract with a fine tooth comb with your attorney. Trust but verify.

I agree that a doc doing essentially the same procedures and being reimbursed under the same CPT codes should generate the same revenue, but don't believe that this necessarily translates to income.

I think this can be primarily be attributed to factors you've listed (overhead, splitting revenues with the group and sharing in ancillary services).

In your original post you had extrapolated the mean for Anesthsiology: Pain Management (Multispecialty Group) to Ortho groups (which I believe are primarily staffed by Physiatrists). Yes, a shrewd negotiator can work out a nice deal for him/herself, eat what you kill structure, partnership, etc., but with surgical groups, this is likely the exception rather than the rule and the numbers you highlighted are for the mean. As Gorback has pointed out, skewing at the upper end of the curve in this survey seems to have placed the mean quite a bit above the median in certain regions. Were this survey referring specifically to surgical groups, I believe we would see skewing towards the lower end.

Who knows why Physiatrists might accept these types of arrangements? Maybe it's the nature of your typical Physiatrist, maybe it's because the reference point for new PM&R grads is a starting general inpt rehab salary, while the anesthesia pain doc's reference point is the current starting salaries for OR anesthesia. Maybe its a trade-off between lower income vs built-in referral/steady income (many Physiatrists not listed under Pain-Management have difficulty obtaining referrals without extensive marketing). What I've noticed is that many new Interventional Physiatrists will sign up with a surgical group as a 1st job (maybe it's the thrill of finally making a decent salary while doing primarily procedurally based work), then leave a few years later when they realize the opportunities aren't there. The surgical group is under no pressure to negotiate, because if they're located in a major metropolitan area, they've got a bunch of other applicants waiting in the wings.

Mind you, I can't back up anything I'm saying other than what I see.

Tenesma seems to agree with me on this.

or you could take the job with the steady income - but you will have to live with the knowledge that the partners of the group are getting a percentage of your work --- and a staggered partnership with an ortho group means that you will always be their waterboy...

the problem with joining a surgical group is that the conventional wisdom is that the surgeon does all the hard work, takes all the hard call, has made all the sacrifices and therefore is entitled to most of the income ---- i have yet to see a multi-specialty ortho/spine group that is truly fair as far as income distribution goes

i have a competing spine group a few towns away that has hired 3 PMR guys to do their injections... those PMR guys do way more procedures than I do, yet my income is close to double of theirs.... they don't know my income ... and they are convinced that they have the greatest deal ever with their spine surgeons...

you could also look at joining a group as a learning experience - and then leave after a year to start up your own practice once you have a reputation and a steady flow of patients from outside of the spine/ortho practice.... make sure you don't have a non-compete contract though...
 
The MGMA doesn't break out physiatry into subspecialties. Thus the only measure of pain management reimbursement in their survey is under the category Anesthesia: pain management

It has been my experience that most ortho groups still have arrangements with, or hire, anesthesiologists as their pain guys, btw. We notice the PM&R guys more 'cause that is what we see, but I still think the lion's share of pain docs in ortho and neurosurgical practices are anesthsiologists, as they can serve the dual roll of staffing the anesthesia needs of the group owned ASC as well as doing the procedures.

I have rarely seen arrangements where the group continues to keep a percentage of the revenue you generate past the first year or two of your employment, even if they don't make you partner. In almost every contract that I have reviewed, after that initial period, you transition over to a pure eat what you treat model. The group continues to reap significant financial benefit from the PT MRIs, back braces and other DME you order, and the increased use of their ASC.
 
ampa... i have been in bad contracts, i have reviewed bad contracts and i have many friends who have dealt w/ bad contracts...

the eat what you kill mantra is nice but it is usually after expenses... and that is how these larger groups get you... they create b-s expenses, etc so as to minimize your profit margin...

i have a friend who became partner and didn't see a huge jump in his income - he requested a copy of the books to look at the expenses... there were country-club memberships for the primary founding partners (considered a marketing expense), there were charitable donations to a local super competitive private school that two of the partners wanted to get their kids into, there were expenses for a rad tech and three PAs (none of which had ANYTHING to do with my friend's daily practice).... when he started requesting that his overhead ONLY reflect his general expenses, he was told to live with or go shove it... he left the group... and is suing now for fraud...

so in fact there is no such things as a "pure eat what you kill" set-up because the reality is that there is overhead associated with everything you do... now if the "eat what you kill" formula is Net Collections MINUS billing fees, base salary with payroll taxes, health insurance, malpractice insurance, and utilities/payroll for the equipment/staff/area that you use... then that is as close you will ever get to a "pure" formula....


the PRIMARY reason that spine/ortho surgeons play fair with the other surgeons is because they can share call - they will never play fair with somebody who doesn't share their call...
 
ampa... i have been in bad contracts, i have reviewed bad contracts and i have many friends who have dealt w/ bad contracts...

the eat what you kill mantra is nice but it is usually after expenses... and that is how these larger groups get you... they create b-s expenses, etc so as to minimize your profit margin...

i have a friend who became partner and didn't see a huge jump in his income - he requested a copy of the books to look at the expenses... there were country-club memberships for the primary founding partners (considered a marketing expense), there were charitable donations to a local super competitive private school that two of the partners wanted to get their kids into, there were expenses for a rad tech and three PAs (none of which had ANYTHING to do with my friend's daily practice).... when he started requesting that his overhead ONLY reflect his general expenses, he was told to live with or go shove it... he left the group... and is suing now for fraud...

so in fact there is no such things as a "pure eat what you kill" set-up because the reality is that there is overhead associated with everything you do... now if the "eat what you kill" formula is Net Collections MINUS billing fees, base salary with payroll taxes, health insurance, malpractice insurance, and utilities/payroll for the equipment/staff/area that you use... then that is as close you will ever get to a "pure" formula....


the PRIMARY reason that spine/ortho surgeons play fair with the other surgeons is because they can share call - they will never play fair with somebody who doesn't share their call...
Not all orthopods are a$$holes. Not all groups are out to screw you. In fact, pain groups, anesthesia groups, and multi-specialty groups will screw you just as often as surgeons will.

The groups that f$%k you over do so because, in part, you let them. They fudged the expenses? Demand transparency. They make you pool a percentage of your income? You knew that going in.

The are crooks everywhere. Take some responsibility, review your contract THOROUGHLY with an accountant or an attorney. Never assume anything. If they lie, cheat, or steal, take them to court. If they outsmarted you, if you were too inexperienced or arrogant to ask for help? You have no one to blame but yourself.
 
you HAVE to go in with the mind frame that you will be screwed over... prepare for the worst and hope for the best...

no group (in its right mind) will offer you a partner contract when they first hire you... they will always offer an employee contract with the "carrot on the stick" of a partnership contract down the road...

they have no obligation to show you the books when you are an employee - and they definitely have no obligation to show you the books when you are applying for a job...

if you ask for your accountant to review their books most groups will walk away...

there are very few if any employee contracts that stipulate partnership agreements - if anything they may suggest that within 2 years you may be able to purchase a share based on book value.... what you typically end up buying is office furniture and computers and that is really about it (unless they own ancillaries)... as long as you don't have have 50.5% of the shares you really have NO say whatsoever.... in fact the majority owners can buy back your shares without you having much recourse.... and just because you own shares as a minority holder doesn't mean that you can help dictate the financial management of the group

i agree that any group will screw you.... i have found that the larger the group, the fairer the set-up is ...

however, i don't want newbies to be mislead that a promise of partnership really means anything... they can delay partnership for years despite the 2 year promise --- for a multitude of reasons - including not yet being board certified, not having met certain "production quotas"....

one classic example is a new associate - he gets ALL of the low paying insurance patients and the partners get all the high paying insurance patients.... he works harder than the partners yet his collections are lower than his partners... they keep on telling him that as soon as he catches up to the partner's collection level then he can buy a share... they string him along for 4 years (this was for a 2 year track to partnership) and then tell him that he just isn't a good fit...

HAPPENS ALL THE TIME....
 
you HAVE to go in with the mind frame that you will be screwed over... prepare for the worst and hope for the best...

no group (in its right mind) will offer you a partner contract when they first hire you... they will always offer an employee contract with the "carrot on the stick" of a partnership contract down the road...

they have no obligation to show you the books when you are an employee - and they definitely have no obligation to show you the books when you are applying for a job...

if you ask for your accountant to review their books most groups will walk away...

there are very few if any employee contracts that stipulate partnership agreements - if anything they may suggest that within 2 years you may be able to purchase a share based on book value.... what you typically end up buying is office furniture and computers and that is really about it (unless they own ancillaries)... as long as you don't have have 50.5% of the shares you really have NO say whatsoever.... in fact the majority owners can buy back your shares without you having much recourse.... and just because you own shares as a minority holder doesn't mean that you can help dictate the financial management of the group

i agree that any group will screw you.... i have found that the larger the group, the fairer the set-up is ...

however, i don't want newbies to be mislead that a promise of partnership really means anything... they can delay partnership for years despite the 2 year promise --- for a multitude of reasons - including not yet being board certified, not having met certain "production quotas"....

one classic example is a new associate - he gets ALL of the low paying insurance patients and the partners get all the high paying insurance patients.... he works harder than the partners yet his collections are lower than his partners... they keep on telling him that as soon as he catches up to the partner's collection level then he can buy a share... they string him along for 4 years (this was for a 2 year track to partnership) and then tell him that he just isn't a good fit...

HAPPENS ALL THE TIME....
Rather than allowing the mere promise of partnership, demand that the parameters with which such a decision will be made AND the financial formula they will base your buy-in on be included in the terms of your INITIAL employment agreement.

Groups can track expenses, just as they track collections. The CFO produces speadsheets monthly, and potentially, if the EMR is fully integrated with the practice management software, real-time. If the group is unwilling to share that data with an employee whose compensation is, in part or in whole, based on his collections after expenses, that should be a big red flag. You are absolutely right - they have no obligation to show you their numbers. But you have no obligation to take the position either. If, as you say, they walk away when you make a reasonable request for transparency, you are probably better off.
 
an employer would be a fool to include partnership parameters within an employee contract... to combine two separate contracts sets up the employer for all kinds of potential problems if litigation occurs

what the employer would most likely do is set forth buy-in costs in broad and vague strokes - stating something like: at the end of the employee contract, the employee may be offered a partnership. If the employee agrees, then he/she will have to pay fair market value for the shares tendered... the fair market value is basically what ever the organization owns.... don't confuse percentage share ownership of "stuff" with a percentage of "profits".... and it doesn't help much if you own "two chairs, one coffepot and three desks and an old fax machine" --- what are you going to do with those? burn them if you get upset?
 
an employer would be a fool to include partnership parameters within an employee contract... to combine two separate contracts sets up the employer for all kinds of potential problems if litigation occurs

what the employer would most likely do is set forth buy-in costs in broad and vague strokes - stating something like: at the end of the employee contract, the employee may be offered a partnership. If the employee agrees, then he/she will have to pay fair market value for the shares tendered... the fair market value is basically what ever the organization owns.... don't confuse percentage share ownership of "stuff" with a percentage of "profits".... and it doesn't help much if you own "two chairs, one coffepot and three desks and an old fax machine" --- what are you going to do with those? burn them if you get upset?
Generally, buy-in formulae do indeed include the depreciated value of the fixed assets. Again, however, you are not re-inventing the wheel. The group has undoubtedly had other members buy-in in the past, and can provide the parameters of how the fair market value of the AR (i.e. what multiplier was used, or what other accounting methodology was employed to calculate the fair market value, which, by the way, is not a fuzzy term, but rather has very specific definitions based on generally accepted accounting practices). You are right - the hard assets do not amount to a whole lot - it is the future revenue stream we are all concerned with, and you are best off getting all the information you can up front just so there are no surprises like the ones you are describing you have seen "newbies" run into in the past.

There may be several corporate entities to pay attention to. The practice, the real estate corp, and the ASC are typically all separate. You have to make certain you know what the buy in is for EACH of these, and not assume that the practice buy-in covers each of these.

Again, the idea here is to NOT be arrogant and think you can handle this yourself, but rather, get a good health care contract attorney, and have him review things CAREFULLY before moving forward.
 
Since I can't figure out how to post this in table form, please note that the four numbers in each category represent Mean, 25th, Median, 75th, and 90th percentile, respectively:

Anesthesiology: Pain Management

Overall
: $437,705 $337,500 $382,592 $500,000 $610,505

Eastern: $376,588 $337,500 $343,750 $489,286 $510,612

Midwest: $492,431 $341,417 $401,887 $576,078 $995,808

Southern: $480,190 $354,000 $354,000 $515,436 $933,231

Western: $416,908 $347,201 $395,523 $493,202 $663,947

Now you know why Algos and Gorback live where they live!

One other interesting piece of data which belies those who say you will be underpaid if you work with a group of orthopods or primary care docs:

Single Specialty: $415,617 $337,500 $354,000 $500,000 $548,534

Multispecialty
: $483,531 $338,474 $414,282 $510,517 $917,872





these numbers look accurate if they represent TOTAL COMPENSATION...otherwise I think that they are a little high based on talking candidly to other collegues.....who knows maybe we are all in the 25% bracket..........
 
That seems off to me. 90 percentile at near a million? Ive seen dozens of physician salary surveys and never seen numbers that high. Even if you assumed massive billable work and shares in a outpatient surgery center, I think only a small % are going to see digits that big, not 10% of the general surveyed population (which is often a massive underestimate because real ballers almost never participate in that).
 
That seems off to me. 90 percentile at near a million? Ive seen dozens of physician salary surveys and never seen numbers that high. Even if you assumed massive billable work and shares in a outpatient surgery center, I think only a small % are going to see digits that big, not 10% of the general surveyed population (which is often a massive underestimate because real ballers almost never participate in that).
90th percentile is 610K overall.
 
one thing that you guys are missing is that not every physician reports their data correctly -

some physicians only pay themselves between the 25th % and the Median - then fund their SEP IRA as a corporate benefit, and then instead of bonuses (which are payroll taxable) they provide corporate distributions....

so salary data will always be a bit flawed... again, what matters most is that you enjoy what you do, and that your family is happy...
 
Rather than allowing the mere promise of partnership, demand that the parameters with which such a decision will be made AND the financial formula they will base your buy-in on be included in the terms of your INITIAL employment agreement.


This advice alone is worth its weight in gold.
 
90th percentile is 610K overall.

was focusing on South/Midwest, they do make more there on average but I seriously doubt the spread is so huge.
 
one thing that you guys are missing is that not every physician reports their data correctly -

some physicians only pay themselves between the 25th % and the Median - then fund their SEP IRA as a corporate benefit, and then instead of bonuses (which are payroll taxable) they provide corporate distributions....

so salary data will always be a bit flawed... again, what matters most is that you enjoy what you do, and that your family is happy...

um yeah that maxes out at 45,000+catch up+COLA increase. Distributions from S-corp are included in AGI, which I would think this is trying to present.

If it is just W-2 income, any salary survey would be worthless as there are innumerable ways to get $$$ into your pocket aside from this.
 
that's my point -- in these salary surveys how do you know if somebody is reporting the distributions on ownership of ancillaries or profit sharing from efficient practices??? and are these surveys based on actual tax returns or based on what some people "report" --- i am interested in their methodology.
 
Does anyone have the 2007 ranges for General Surgery; Vascular Surgery??
 
Do you have any update of the 2008 MGMA Survey Results?
 
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