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March 19, 1999
Psychiatrists' net income rose 3 percent in 1997 from the previous year, after experiencing a decline from 1995 to 1996, according to the most recent survey of physician incomes published in the September 7 issue of Medical Economics.
Psychiatry was among four medical specialties with gains in net earnings; the others were internal medicine, gastroenterology, and family practice.
In 1997 psychiatrists' net income rose from $110,640 in 1996 to $113,770, while their gross income rose slightly from $164,820 to $165,220 (.4 percent), according to the article.
Most of the 15 specialties experienced no increase or a modest decrease in gross income and a modest increase in net income from the previous year. The article attributed this trend to more efficient management of physician practices in terms of staffing, billing, and computer upgrades.
Psychiatry remained at the low end of the specialty pay scale in 1997, ranking only above general practitioners in overall gross and net income, according to the article. Neurosurgeons remained at the top of the pay scale with $500,620 in gross earnings and $288,830 in net earnings.
Contrary to expectations about managed care, physicians participating in one or more HMOs continued to fare better than non-HMO participants. For example, HMO participants earned $170,800 in net income in 1997 compared with $137,650 for non-HMO participants, noted the article.
The gap between HMO and non-HMO participant earnings has been consistent for the last four years. However, the gains for HMO participants appeared to level off in 1997, according to the article. The median dollar gains of survey respondents in HMOs dropped by 1 or 2 percentage points in each of the past four years. "In fact, their 1997 net income rose less than 1 percent, down from 6 percent as recently as 1994," the report stated.
A new trend for 1997 was that inner-city physicians increased their gross and net earnings, while earnings for physicians in urban, suburban, and rural areas remained flat or fell, noted the article. The report attributed these trends to expanded Medicaid coverage under managed care.
In 1997 inner-city physicians earned $226,960 gross and $141,370 net; as a group, however, these physicians still had the lowest earnings.
The survey results were based on responses from 10,145 office-based physicians in patient care, including 629 psychiatrists (6 percent). The Phoenix Marketing Group and the American Medical Association estimated that that percentage was proportionate to the number of psychiatrists in the United States in December 1997, when the survey was prepared, according to the November/December 1998 issue of APA's Psychiatric Practice and Managed Care newsletter.-C.L.