Post-Graduate Business Degree Drives Pay for Physician Executives
Cejka Search and the American College of Physician Executives Release Findings from 2009 Physician Executive Compensation Survey
ST. LOUIS (September 29, 2009) – Signaling the increased value placed on top performing physician executive leadership, the attainment of a post-graduate business degree can garner a 10% greater salary, and be a significant door-opener for increased professional opportunity for physicians in administrative roles.
This and other findings are reported in the 2009 Physician Executive Compensation Survey conducted by the American College of Physician Executives (ACPE) and Cejka Search.
"There is a growing need for physicians who are effective leaders," explains Barry Silbaugh, Chief Executive Officer of the American College of Physician Executives. "In an era of reform, organizations recognize the essential role of physicians who complement their clinical training with business education and leadership development to help ensure a balance of priorities, including quality and financial performance."
Top findings include:
- One-third of physician executives (33%) have a post-graduate business degree (MBA, MMM, MPH, or MHA)
- Physician executives earn on average a 10% greater salary with the attainment of the following post-graduate business degrees: 11% more with a Master of Business Administration (MBA), 8% more with a Master of Medical Management (MMM), and 10% more with a Master of Health Administration (MHA) compared with those without a post-graduate business degree.
- The type of degree the physician executive holds makes an even more significant difference within a particular executive role. Comparing physician executives counterparts with and without a post-graduate business management degree, the following reported the largest differentials:
- Chief Executive Officers/Presidents earn 22% more with an MBA.
- Department Chair/Chiefs earn 25% more with an MMM.
- Medical Directors earn 18% more with an MHA.
- Overall physician executive compensation averaged $288,000 in 2008, a 2-year gain of 12% and a 10-year increase of 44%. Compensation increased for all categories reported in the survey. Physician executives in these roles reported double-digit gains over the past 2-years:
- Chief Executive Officer/President earned $383,500, up 13%.
- Chief Medical Officers earned $324,750, up 11%.
- Department Chair/Division earned $330,000, up 10%.
Post-graduate business degrees are worth the time and expense
"Healthcare organizations are now mandating advanced business degrees in conjunction with strong clinical expertise for their physicians in executive leadership positions," explains Lois Dister, Executive Vice President and Managing Director with Cejka Search’s Executive Search Division. "At the senior leadership table, physician leaders with business expertise are valued for their unique combination of clinical and business training, which results in better outcomes for patients and performance for the organization."
Financial performance and clinical quality are drivers for executive bonus distribution
- Executive bonus is based on achieving a mix of organizational (55%) and personal (45%) goals.
- Two-thirds (62%) cite financial performance, including cost containment and organization profit, as a component of their bonus, which is a 60% increase in frequency from 2007 when only 39% mentioned this as a determinant of their executive bonus.
- More than half (53%) cite clinical quality, including outcome measurements, safety and process, as a bonus component, a 67% increase in frequency as compared to 32% in 2007.
- Forty-four (44%) cited satisfaction among patients, physicians and employees as a component of their bonus – more than double the 20% frequency reported in 2007.
"Clinical quality is the fastest growing bonus component. In an era influenced heavily by Institute of Medicine and national quality organizations, these overarching goals are synonymous with the rankings of top hospitals," says Deedra Hartung, Executive Vice President and Managing Director with Cejka Search’s Executive Search Division. "But it is also evident, that responsibility for financial performance and stakeholder satisfaction also are determinants in compensation for many if not most physician executives throughout the organization."
"A number of factors can greatly influence compensation levels: the specific healthcare sector, the organization’s size and scope, as well as the organizational context in which the leaders find themselves," explains Lori Schutte, President of Cejka Search. "Organizations seeking to establish and develop top-performing executive physician leadership should have clearly defined clinical and business objectives, an honest assessment of their organization’s culture, and a system to ensure physician executive compensation is fair, equitable, and correlate to the results achieved. Those are the healthcare organizations that will attract and leverage the talents of the best physician executives."
Visit http://www.cejkasearch.com/acpe to purchase a copy of the 2009 Physician Executive Compensation Survey. Costs are $150 for ACPE members and $350 for non-members. Individual sections (electronic only) with Executive Summary included, may be purchased for $75 for ACPE members and $150 for non-members.
Methodology
The Cejka Search and ACPE 2009 Physician Executive Compensation Survey was distributed electronically in May 2009 to 9,289 ACPE members. A total of 2,131 questionnaires were used in the survey tabulation, representing a twenty-three percent (23%) response.
About the American College of Physician Executives
The American College of Physician Executives (ACPE), located in Tampa, Florida, is the leading national professional association representing physicians in management and boasts a membership of over 9,000 including some of the nation’s top healthcare leaders.
About Cejka Search
Cejka Search is a nationally recognized healthcare executive and physician search organization providing services exclusively to the healthcare industry for more than twenty-five years. Partnering with our client organizations to identify and present only the best healthcare talent, Cejka Search completes assignments across all levels of the healthcare continuum and is a market leader in providing flexible, innovative healthcare search and recruitment services. Cejka Search is a Cross Country Healthcare, Inc. (Nasdaq: CCRN) company, a diversified leader in healthcare staffing services.
For more information, contact Nancy Burns, Cejka Search, at nburns@cejkasearch.com or 314-726-1603.
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