Published on Apr 26, 2021

Video Transcript

[MUSIC PLAYING] JOHN WHYTE: Welcome, everyone. I'm Dr. John Whyte, the Chief Medical Officer at WebMD. And today, I want to talk about physician compensation-- specifically, Medscape's Physician Compensation Report, one of the most comprehensive reports out there on physician compensation. I encourage you to check it out on Medscape.

Now, we all know the impact of the pandemic on health care. You might be surprised to hear that on average, physician compensation didn't change much last year. That's a little misleading, though. So to help unpack the data, I've asked my friend, Dr. William Fox-- he's Chair of the Board of Governors of the American College of Physicians. Bill, thanks for joining me.

WILLIAM FOX: John, thank you so much for having me again.

JOHN WHYTE: You know, I want to start off-- I kind of gave those average numbers. But let's talk about that many physician offices had to cut staff, renegotiate their rent, their lease payments. And if it wasn't for the telehealth benefit being changed and the payment protection, a lot of physician offices could have gone under. Isn't that right?

WILLIAM FOX: Well, first I'll say, John, that physicians and physician practices have been under enormous amount of strain over the past year, both financially and also emotionally. We are now beyond one year in this pandemic, and it has certainly taken an emotional toll. I'm in a small, independent, three-physician practice, and I think that my practice kind of mirrors what we have seen nationally. In the beginning days of the pandemic, Most, people were scared to go anywhere.

There were stay-at-home orders in effect, and people were scared to come even into the doctor's office for routine visits or even urgent visits. As you know, doctors are paid on a fee for service basis. If patients come into the office, they are able to collect the revenue from third-party payers like Medicare and insurance companies.

But in the beginning, no one came into the office, and that put a lot of physician practices at-risk. I remember back in March, that was the first time after I had initiated my practice where I was not able to pay myself a paycheck that month. So physicians were looking at significant revenue declines in the beginning of the pandemic. And then as you mentioned, we were able to begin to change things around, tweak things to be able to get on more solid footing. And some of those included being able to see patients via telemedicine.

JOHN WHYTE: That was a big deal, wasn't it, because we always had, to some degree, a telemedicine benefit, but we didn't have payment parity-- that we would not pay the same rate as an in-person visit. That made a fundamental difference, didn't it?

WILLIAM FOX: That was huge, John. And I always say that physicians had to pivot and do inm essentially, two days what it took them 20 years to ask Medicare and private payers to do, which is to see patients via the computer when it was appropriate to do so. And that allowed physicians to then get reimbursed for the work that they were doing. And then, of course, as I was mentioning, there was government help as well in the form of the Paycheck Protection Program.

JOHN WHYTE: Now, a lot of physicians have been talking about to get back to that pre-pandemic compensation, they're going to have to work longer hours, they're going to have to work more days, they're going to have to see more patients, work harder. We've been talking about burnout and how the pandemic has made it worse. The issues of now they're going to have to work harder-- how does this impact the practice of medicine?

WILLIAM FOX: Well, we hope that, going forward, payers and the government will look at how they pay physicians, and, perhaps, begin to experiment or utilize new models of payment to improve the entire experience, both from the patient perspective and the physician perspective. But just stepping back for a minute about what you said about burnout, we know that there has been significant burnout over the past several years as physicians have had to work harder in order to try to earn the same incomes that they have previously.

There were studies that came out earlier in the year, one from the Physicians Foundation, that estimated that about 8% of all physician practices nationally, which actually equates to about 16,000 practices, had to close under the strain of the pandemic. And that strain was both financial and simply based on burnout. It was too much for the physicians.

JOHN WHYTE: And some physicians retired early. We talked about that before. They may have been close to retirement and said, you know what? I've had it. But what was the main difference between those practices that succeeded and those that did not? Was it this ability to pivot? Was it this ability to continue to innovate? What do you find are some of those differences?

WILLIAM FOX: Well, I can tell you specifically from the standpoint of my practice, it was the ability to pivot and take advantage of a number of things, including quickly switching over to providing care via telemedicine platforms and taking advantage of some of the government stimulus money in the form of the Paycheck Protection Program. I think those were the two key things that allowed our small practice to survive.

And I suspect that those things allowed other practices to survive as well. And perhaps those that couldn't take advantage of those things did not fare as well. And then we do, again, have to consider the strain and the burnout-- many physicians who are close to retirement simply did not have the emotional bandwidth, I would say, to pivot in that manner.

JOHN WHYTE: And I want to put a chart up that shows compensation by specialty. And not surprisingly, nothing has changed, Bill-- the orthopedists and the cardiologists are at the top. And the family medicine and pediatricians are at the bottom. Nothing has changed in the last probably 50 years. But when we talk about providing more primary care, when we talk about more prevention, the importance of public health-- what does this tell you that we need to be doing?

WILLIAM FOX: Well, we are concerned about the discrepancy in reimbursement between primary care physicians and specialty physicians. And this is, without any disrespect to our specialty colleagues who work extremely hard and are extremely valuable, but we look at primary care as the backbone of a highly functioning and cost-effective health care system with the greatest ability to provide high value care and lower the cost curve.

Remember that we spend over $3.5 trillion on health care in the United States. It's like 20% of our GDP. So we need to continue to find ways to provide cost-effective care. And we believe that primary care is the way to do that.

JOHN WHYTE: What are the ways to fix that? We have a $200,000 differential to some degree between the highest and the lowest-paying specialties.

WILLIAM FOX: Well this, is something that the American College of Physicians has been working on for years. We recognize this discrepancy, and we have been advocating for changes for decades. I will talk about one bright spot, and that is recently, outpatient office visits, which are the mainstay of how primary care physicians gain their income, had undergone the most dramatic changes in reimbursement levels in several decades-- that some of the reimbursements for primary care visits as of January 1, 2020-'21, have increased by as much as 25% to 30%-- this as a result of the recommendations from the AMA Relative Value Update Committee, which were instituted by CMS last year and went into effect at the beginning of this year.

So that will help. But that's only a partial fix, John. We really need to figure out a way to move beyond a fee for service system specifically so that care is not so fragmented, and that payment mirrors the way care is delivered in the modern era.

JOHN WHYTE: I also want to talk about diversity and inclusion. And a graph here shows that, still, there are fewer women in higher-paying specialties. In general, we know that women have bore the brunt of managing family life and professional life, more so than men. But still, there are few women in high-paying specialties. What impact does that have? And how do we fix that? We've been talking about it for decades. Are we finally going to have a different conversation, Bill, in a couple of years?

WILLIAM FOX: Well, first of all, John, everything that you just pointed out is true. And it's really unfortunate. And I think one other fact that came out of the survey that you put out is that women physicians are, on average, earning about, I think, 25% to 27% less than their male counterparts. And this is just simply unacceptable. There should be no disparity based on gender. It's a complex issue. It involves work at every institution to try to overcome these discrepancies. I don't know that there's one single bullet, but we do need to dedicate ourselves to ending that gender pay disparity.

JOHN WHYTE: How do we do it?

WILLIAM FOX: Well, I don't know that there's any single bullet, but this requires every single institution to take a look at their own practices and make sure that their compensation plans are equitable.

JOHN WHYTE: I want to thank you for providing your insights today about our Medscape Physician Compensation report, and really reflecting upon how this impacts the practice of medicine. It's not just about how physicians are paid, but also how we provide health care-- how that system is set up. Thanks for your time today.

WILLIAM FOX: John, it's always great to be with you.