Salaries

[DermMatch]

Since this topic has been raised in another thread, here's some data I got in the mail today:

Physician compensation by geographic region per the American Medical Group Association's 2009 Medical Group Compensation and Financial Survey

East = $325,543
West = $374,737
South = $319,157
North = $328,900
Overall median = $350,627

Doesn't say how many days worked, patients seen, or types of services provided (ie, all med derm, cosmetics, surgical).

Higher medians were anesthesiology, CT surgery, cards, diagnostic radiology, GI, neurosurg, ortho, ENT, plastics, urology, and vascular. The hands-down winner was neurosurg at a median of $548,186 -- they better make some dough after 7 years of residency. Family medicine trailed in at last with a median of $197,655 -- not horrible.

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[dirtbag]

These numbers are always hard to interpret. One would want to use them to either a) choose a specialty or b) choose a region to work. However, as far as specialty we don't know the hours worked, which is extremely relevant! It is highly likely that the derms are working an average of half the hours of the cardiologists. The generalizations of the regions aren't helpful because the number of large cities or rural ares will vary by region.

 

[MOHS_01]

These surveys do not provide great information. Also, these do not reflect salaries; they reflect total compensation. Sometimes they reflect an average while at other times they reflect the median. There exists as significant of a variability within a specialty oftentimes as there is between specialties.

If you expect to get paid 350-400k and cruise just because you are a dermatologist or saw it in a some survey you will only be setting yourself up for a big disappointment.

 

[Cirrus83]

Most of the highly paid specialties I kind of expected but I never realized vascular surgeons made more money than ENTs
No wonder the vascular guys are some of the happiest surgeons here.

 

[bronx43]

These surveys do not provide great information. Also, these do not reflect salaries; they reflect total compensation. Sometimes they reflect an average while at other times they reflect the median. There exists as significant of a variability within a specialty oftentimes as there is between specialties.

If you expect to get paid 350-400k and cruise just because you are a dermatologist or saw it in a some survey you will only be setting yourself up for a big disappointment.

Isn't a major chunk of compensation vs salary the time off? I've heard that it usually adds $30-40k to a salaried number.

 

[dirtbag]

In your opinion, what are the most important factors influencing this variability? Number of hours worked per week? Amount of cosmetics done? How saturated the market location is? Academics vs private practice?


Am I missing any big ones here? If not, these seem like variables that are pretty easy to control if making decent money is a priority to you and you r willing to work more than 4 days a week. UNLESS, you tell me that there are just not enough successful practices out there with jobs to go around (kinda like the derm match) or you really need to bust your hump and work 80 hrs per week to pull in 350k.

And on a sidenote, I'm not sure where you guys are all from, but making 350k is not so much money if you're living in an expensive city like ny, paying off loans, starting a family, and just starting saving for retirement in your 30's. I would hardly call it "cruising"

 

[MOHS_01]

Isn't a major chunk of compensation vs salary the time off? I've heard that it usually adds $30-40k to a salaried number.

I'm not sure that I follow you, friend. Physician compensation -- aside from the purely employed -- eventuates in an easy formula:

revenues - costs = pre-tax compensation.

Both factors on the left hand side of the equation include factors that vary from region to region -- which is the basis for regional variation in compensation.

Even when one is employed, though, the employer will base the majority of any compensation off of the formula listed above. You may command a premium due to a perceived desperate need for your services... or a PCP may "warrant" some redistribution monies in order to "compensate for the inequalities of the RBRVU system" (as was so eloquently stated to me by two multispecialty group executives)... but, ultimately, the majority of your comp will come from the residual of your production after costs are extracted.

 

[cosmos540]

i know a FP doc who runs her practice like a well-oiled machine w/ some cosmetic derm on the side among other things - pulling in $500k/yr

 

[bronx43]

I'm not sure that I follow you, friend. Physician compensation -- aside from the purely employed -- eventuates in an easy formula:

revenues - costs = pre-tax compensation.

Both factors on the left hand side of the equation include factors that vary from region to region -- which is the basis for regional variation in compensation.

Even when one is employed, though, the employer will base the majority of any compensation off of the formula listed above. You may command a premium due to a perceived desperate need for your services... or a PCP may "warrant" some redistribution monies in order to "compensate for the inequalities of the RBRVU system" (as was so eloquently stated to me by two multispecialty group executives)... but, ultimately, the majority of your comp will come from the residual of your production after costs are extracted.

Oh, I'm talking about figures that I've seen where the compensation includes everything from 401k and SS to "time off," which usually amounts to $60-90k for a specialist. The salary number is simply the total compensation minus these other "benefits."

 

[bronx43]

i know a FP doc who runs her practice like a well-oiled machine w/ some cosmetic derm on the side among other things - pulling in $500k/yr

I don't understand why every FP doesn't at least try to get into cosmetic derm. It requires no further training/certification, and you're not really adding a whole lot of overhead to your practice. A single botox injection, which would take all of 10 minutes, could land you a couple hundred bucks.

 

[bronx43]

In your opinion, what are the most important factors influencing this variability? Number of hours worked per week? Amount of cosmetics done? How saturated the market location is? Academics vs private practice?


Am I missing any big ones here? If not, these seem like variables that are pretty easy to control if making decent money is a priority to you and you r willing to work more than 4 days a week. UNLESS, you tell me that there are just not enough successful practices out there with jobs to go around (kinda like the derm match) or you really need to bust your hump and work 80 hrs per week to pull in 350k.

And on a sidenote, I'm not sure where you guys are all from, but making 350k is not so much money if you're living in an expensive city like ny, paying off loans, starting a family, and just starting saving for retirement in your 30's. I would hardly call it "cruising"

You don't think $350k is a lot of money? Unless you're looking to live in the Upper East Side, Tribeca, or some other gaudy part of town, that's a good chunk of change. You're not making hedge fund or private equity money, but unless you went to a top 20 undergrad and/or have one of those "quant" brains, those options were closed off to you long ago. In fact, brace yourself for even lower than $350k.

 

[dirtbag]

Yes, 350k is a good living in most areas of the country, but it aint a great living.

 

[bronx43]

Yes, 350k is a good living in most areas of the country, but it aint a great living.

That would depend entirely on your definition of "good" versus "great."

One can as easily make the statement that $2 million [or whatever absurd number you want to insert] a year is a good living, but not great.

 

[dirtbag]

Of course "good" and "great" are relative. I would also argue that the term "cruise" is relative too, which was the post to which I originally offered a differing opinion. When I refer to good and great incomes I am comparing to what somebody with the intelligence, drive, and invested effort and money/opportunity cost could have accomplished financially outside of dermatology. Trust me, it doesn't take nearly as much work and investment to secure a business job that pulls 350k per year.

 

[bronx43]

Of course "good" and "great" are relative. I would also argue that the term "cruise" is relative too, which was the post to which I originally offered a differing opinion. When I refer to good and great incomes I am comparing to what somebody with the intelligence, drive, and invested effort and money/opportunity cost could have accomplished financially outside of dermatology. Trust me, it doesn't take nearly as much work and investment to secure a business job that pulls 350k per year.

Are you serious...? Every time I hear someone in the medical field utter that very notion, I want to tear my hair out.

I don't know what "business" job you're referring to, but the only business jobs with a $350k potential by the time a dermatologist gets out of residency is finance, and the only way you can get into finance is if you attended a top university. Try applying to a bulge bracket ibank, PE shop, or VC firm. It's not exactly like applying to medical school. If your undergrad institution wasn't prestigious enough to be on their recruiting list, you're basically screwed, unless your daddy plays golf every weekend with the bank's MD (that's managing director).
And once you're in finance, you think the hours are like those in corporate? Bankers are working 90-100 hours easy. Do that for a few years, and if you're good, you might get to stay, as there are always younger, fresher meat to replace you. If you're top talent and lucky enough to get a headhunter's attention, then you'll end up in HF, PE, or VC. Hours aren't rosy there, either.

Then, of course, there are traders. They work 9-5, and have an unlimited earning potential. But, unless you're a cream of the crop math major with a brain like a AMD processor, then you can forget about this one.

So, yeah, derm is a pretty damn good gig. If you can get in, then consider yourself one of the lucky few to be able to pull in $350k, working 40 hours a week.

 

[jabreal00]

These numbers are always hard to interpret. One would want to use them to either a) choose a specialty or b) choose a region to work. However, as far as specialty we don't know the hours worked, which is extremely relevant! It is highly likely that the derms are working an average of half the hours of the cardiologists. The generalizations of the regions aren't helpful because the number of large cities or rural ares will vary by region.

Cardiologists and gastroenterologists make a lot of money because it's a procedure oriented specialty. A GI doc can do nothing but EGDs and colos 5days a week 9-5 (clinic hours) and make in the mid to high $300K. The same applies for cardiologists who perform and read their chemical stress test, echo's and cardiac CTs. Not to mention caths, stents, and pacemakers/defibrillators.

 

[KBorglum]

I teach the Options in Practice, Practice Startup, and other courses for AAD for their annual Practice Management program for residents, I teach a similar course for the AAD summer program for derms in practice, and I contribute to Dermatology World. I also do expert witness work for courtroom testimony on derm compensation and practice-valuation, start derm practices, appraise & broker them, and negotiate compensation packages for both employers and employees. I've done this for 25 years, and have closely followed the economic changes in the field.

Yes, the different surveys include different data, but with the serious shortage of derms nationally, compensation has been rising to the point where both median and average comp for derms is around $350,000, straight out of residency or fellowship (almost double-it for Mohs or Path fellows). I can verify that with personal knowledge. As a consultant I routinely assist general dermatologists in starting practices or negotiating employment compensation in excess of $300,000 –and even in excess of $400,000– in their first year of practice. You can readily double or triple that income by employing other derms or mid-level providers, especially in underserved markets (which includes most of the USA more than an hour from any coast or biggest city).

Definitions of "hours worked" can differ by study, and are crucial to understanding the topic. "Revenue-generating hours" can be very different from "total hours" spent in the work setting, as the workplace has an infinite appetite for hours –productive or not. It is "revenue generating hours" that define "full time equivalence" and compensation in medicine.

The Medical Group Management Association (MGMA) Physician Compensation and Production Survey 2009 is the most detailed study in the nation on physician work hours, and the American Academy of Dermatologists study is the largest.

"Clinical service hours" for full-time-equivalence is defined by both the American Academy of Dermatology and the MGMA limited to direct patient care wherein a charge is generated for services rendered.
"Clinical service hours" do not include chart documentation, phone calls with patients, consultations with providers, interpretation of tests, administrative or support activities like billing, marketing, training staff, supervising staff or employed doctors or other providers, on-call time unless a charge is generated at the office or hospital or patient home, phone calls with patients regarding their pathology reports, interpretation of diagnostic tests, dictating letters, nor case-conferences as with physician assistants.

Without sharing copyrighted information by source, I can attest that the typical "full time" clinical hours worked is 34-36 per week, plus around 10-11 hours of non-clinical hours (especially if in private practice and not working for a super-group like Kaiser), seeing 130 patients per week, 47 weeks per year.

According to the American Academy of Dermatology's 2009 Practice Profile Survey, there is a shortage of dermatologists nationwide, and approximately one third of all dermatology practices are attempting to recruit associates or partners or buyers.

The impact of the "Obama Health Plan" (Health System Reform Legislation H.R. 3590), will be that there will be a lot of new patients coming through the system who haven't seen a doctor in years, and there's likely going to be a lot of neglected dermatologic conditions that will need to be addressed.

If you would like more work-study data for employment in groups, I'd suggest purchasing the MGMA.com reports. For small practice data, especially regarding detailed practice income & overhead, I'd suggest the NSCHBC.org Statistics Report as being best.

I've posted a number of articles on the topics of compensation, practice-valuation for buy-ins, getting owner-type benefits without buying-in, tips for joining practices, etc at http://www.medicalpracticeappraisal.com/articles.html

I'd also highly recommend attending the annual AAD practice management programs for residents as early in your training as possible. Its one of the best I've seen.

One final comment: You can be successful in derm -with an adequate income- almost anywhere. What's most important is to be where you want to be, doing what you want to do.

-Keith Borglum CHBC
Practice Management Program Faculty, AAD, AAFP, AAAAI, AAO, etc
Medical Practice Management Consultant, Appraiser & Broker
Contributing Editor, Medical Economics Magazine
http://www.MedicalPracticeAppraisal.com
http://www.MedicalPracticeManagement.com

 

[werd]

we appreciate the input. ~werd.

 

[sdnetrocks]

^^

Keith Borglum is legit and did give a lecture at the practice management symposium for residents at this year's main AAD meeting.

As someone who recently completed a search for my first job and signed a contract, what surprised me the most was the HUGE variability in pay, depending on where and what kind of practice situation you're looking at. Just as an example, one guy wanted to offer me $150k base and "some unspecified percentage of collections" (which he truly never specified) and was quite upfront about wanting to "make money off me" for the first few years before I "buy him out". Now, to the average Joe that seems like a lot of money, but if you've done your homework that was really a laughable offer when you could be making several TIMES as much!

 

[C5toC9]

I never knew there was a nationwide shortage of derms. I thought the shortage was primarily in primary care.

 

[reno911]

I teach the Options in Practice, Practice Startup, and other courses for AAD for their annual Practice Management program for residents, I teach a similar course for the AAD summer program for derms in practice, and I contribute to Dermatology World. I also do expert witness work for courtroom testimony on derm compensation and practice-valuation, start derm practices, appraise & broker them, and negotiate compensation packages for both employers and employees. I've done this for 25 years, and have closely followed the economic changes in the field.

Yes, the different surveys include different data, but with the serious shortage of derms nationally, compensation has been rising to the point where both median and average comp for derms is around $350,000, straight out of residency or fellowship (almost double-it for Mohs or Path fellows). I can verify that with personal knowledge. As a consultant I routinely assist general dermatologists in starting practices or negotiating employment compensation in excess of $300,000 –and even in excess of $400,000– in their first year of practice. You can readily double or triple that income by employing other derms or mid-level providers, especially in underserved markets (which includes most of the USA more than an hour from any coast or biggest city).

Definitions of “hours worked” can differ by study, and are crucial to understanding the topic. “Revenue-generating hours” can be very different from “total hours” spent in the work setting, as the workplace has an infinite appetite for hours –productive or not. It is “revenue generating hours” that define “full time equivalence” and compensation in medicine.

The Medical Group Management Association (MGMA) Physician Compensation and Production Survey 2009 is the most detailed study in the nation on physician work hours, and the American Academy of Dermatologists study is the largest.

“Clinical service hours” for full-time-equivalence is defined by both the American Academy of Dermatology and the MGMA limited to direct patient care wherein a charge is generated for services rendered.
“Clinical service hours” do not include chart documentation, phone calls with patients, consultations with providers, interpretation of tests, administrative or support activities like billing, marketing, training staff, supervising staff or employed doctors or other providers, on-call time unless a charge is generated at the office or hospital or patient home, phone calls with patients regarding their pathology reports, interpretation of diagnostic tests, dictating letters, nor case-conferences as with physician assistants.

Without sharing copyrighted information by source, I can attest that the typical "full time" clinical hours worked is 34-36 per week, plus around 10-11 hours of non-clinical hours (especially if in private practice and not working for a super-group like Kaiser), seeing 130 patients per week, 47 weeks per year.

According to the American Academy of Dermatology's 2009 Practice Profile Survey, there is a shortage of dermatologists nationwide, and approximately one third of all dermatology practices are attempting to recruit associates or partners or buyers.

The impact of the “Obama Health Plan” (Health System Reform Legislation H.R. 3590), will be that there will be a lot of new patients coming through the system who haven’t seen a doctor in years, and there’s likely going to be a lot of neglected dermatologic conditions that will need to be addressed.

If you would like more work-study data for employment in groups, I'd suggest purchasing the MGMA.com reports. For small practice data, especially regarding detailed practice income & overhead, I'd suggest the NSCHBC.org Statistics Report as being best.

I've posted a number of articles on the topics of compensation, practice-valuation for buy-ins, getting owner-type benefits without buying-in, tips for joining practices, etc at http://www.medicalpracticeappraisal.com/articles.html

I'd also highly recommend attending the annual AAD practice management programs for residents as early in your training as possible. Its one of the best I've seen.

One final comment: You can be successful in derm -with an adequate income- almost anywhere. What's most important is to be where you want to be, doing what you want to do.

-Keith Borglum CHBC
Practice Management Program Faculty, AAD, AAFP, AAAAI, AAO, etc
Medical Practice Management Consultant, Appraiser & Broker
Contributing Editor, Medical Economics Magazine
http://www.MedicalPracticeAppraisal.com
http://www.MedicalPracticeManagement.com

Keith seems like a knowledgable guy and I have seen some of his talks. I agree with the most of the above, but part of the bolded part is flat out wrong.

There is absolutely no way that the 50th percentile (which is how I'm interpreting median and average) for a Mohs surgeon straight out of fellowship is near $700,000 for their first year.

If something near 700K is the average it would suggest that nearly half of newly graduating fellows are making more than that in their first year. That is simply not true.

Possibly, I misunderstood and some clarification is necessary. But if it was meant to be taken the way I understood it, then it is incorrect. I am basing my impression on numerous job opportunities for starting Mohs surgeons I have encountered (in many different parts of the country) over the last several years.

 

[MOHS_01]

Keith seems like a knowledgable guy and I have seen some of his talks. I agree with the most of the above, but part of the bolded part is flat out wrong.

There is absolutely no way that the 50th percentile (which is how I'm interpreting median and average) for a Mohs surgeon straight out of fellowship is near $700,000 for their first year.

If something near 700K is the average it would suggest that nearly half of newly graduating fellows are making more than that in their first year. That is simply not true.

Possibly, I misunderstood and some clarification is necessary. But if it was meant to be taken the way I understood it, then it is incorrect. I am basing my impression on numerous job opportunities for starting Mohs surgeons I have encountered (in many different parts of the country) over the last several years.

x2. Ditto. Same here. Bolded portion is not even close to accurate; in fact, for Mohs at least, it is too rosy for the median amongst established providers.