Healthcare Uncovered Episode 16: The Business of Doctoring

Doctors -- you probably think you've got a pretty good handle on how much revenue you individually generate for hospitals. But do you really know how valuable you are to a hospital systems’ financial health?

And how does that compare to other doctors and other specialties?  

Today I am going to pull back the curtain on doctor revenue contribution and break it down by different specialties. And the results may surprise you.

A recent survey of Hospital CFOs by the Physician Recruiting Firm Merritt Hawkins found that Doctors drive $1.56 Million in hospital revenue per-doctor-per-year by ordering tests, performing procedures, etc. But that’s a blended average across a whole wide range of specialties.  

Orthopedic Surgeons generated the most average annual topline revenue at $2.75 Million per Orthopedist -- mostly via the hospital being able to bill commercial insurance and government payors for procedures such as joint replacements and spine surgery.

Interventional Cardiologists generated on average $2.45 Million a year in Hospital Revenue per Cardiologist due to the hospital billing facility fees for the placement of coronary artery stents and other procedures.

General Surgeons generated on average $2.17 Million a year in Hospital Revenue per surgeon for surgeries ranging from gall bladder removal to hernia repair to appendectomies.

And what about Family Practice Doctors?

They generated on average $1.5 Million a year in Hospital Revenue mostly from referring patients in the clinic to the hospital for lab work and imaging such as MRIs and CT Scans.

Obviously, revenue per doctor is a statistic closely tracked by hospital CEOs and CFOs... they know exactly how much each doctor is worth to the hospital’s topline revenue. These statistics also show how valuable doctors are to hospitals.

But here’s the issue:  

In fee-for-service payment, hospital CFOs need doctors to churn out as many tests and procedures as possible to bring in hospital revenue... that’s facility revenue that is completely separate from the professional fee revenue that doctors bill themselves.  

In fact, many doctors never see any of the facility fee revenue that they generate. Is this metric the right way to measure physicians?  

Is this metric the reason why physicians may feel pressure from hospitals to see more and more patients?  

Next time you have a chance, ask your CFO if he or she can share with you what YOUR overall topline contribution is to the hospital.

Healthcare shouldn’t be complicated. Check out Nomi Health’s Open Network of physicians to break through the red tape, collect the money you’ve earned, and get back to why you’re doing this in the first place.... helping patients.