Self-employed physicians have the highest salaries, largest homes, and greatest wealth – yet they feel the least fairly compensated, according to an analysis of data from over 17,000 physicians.
A new examination of survey responses from the Medscape Physician Compensation Report 2020, which included information about income, job satisfaction, and more, compared responses from self-employed physicians, independent contractors, and employed physicians.
Income and wealth, benefits, and job satisfaction were compared. From the results of the questionnaire, self-employed physicians stand out among their peers across all categories: They enjoy greater income, wealth, and benefits and appear to be more satisfied by their choice of practice.
“The survey confirms that self-employed is the most satisfying, although the trend in health care is to take employed positions,” said Robert Scroggins, JD, CPA, certified health care business consultant with ScrogginsGreer, Cincinnati. “Doctors who become employees primarily do that to escape the management responsibilities for the practice. It seems to be more a decision to get away from something than to go toward something.”
The financial and work picture for self-employed physicians
Self-employed physicians reported the largest salaries for 2019 (average, $360,752), followed by independent contractors ($336,005). Employees reported the lowest average salary ($297,332).
The largest percentage of self-employed physicians (46%) work in an office-based group practice, followed by those in office-based solo practices (30%). Almost two-thirds of self-employed respondents are owners and 37% are partners.
Self-employed physicians are more likely to be older than 45 years; 79% fall into that age bracket, compared with 57% of employees and 70% of independent contractors.
Self-employed physicians reported the highest levels of wealth among their peers. About 44% of self-employed respondents declared a net wealth of over $2 million, compared with 25% of employees. Only 6% of contractors and employed physicians reported a net wealth of over $5 million, compared with 13% of self-employed physicians.
Self-employed physicians also managed their personal expenses slightly differently. They were more likely to pool their income with their spouse in a common account used for bills and expenses, regardless of how much they each earned (63% of self-employed respondents, compared with 58% of employees and 50% of independent contractors).
Perhaps unsurprisingly, self-employed physicians also reported having the largest homes, with an average square footage of 3,629 square feet, compared with 3,023 square feet for employees and 2,984 square feet for independent contractors. Self-employed physicians’ mortgages (average, $240,389) were similar to those of employed physicians’ mortgages but were higher than those of independent contractors’ mortgages (average, $213,740).
Self-employed physicians were also most likely to highly appraise their own performance: Half of all self-employed respondents felt “very satisfied” with their job performance, compared with 40% of employees and 44% of independent contractors.
When asked what they consider to be the most rewarding aspect of their job, self-employed physicians were more likely to choose gratitude and patient relationships than their peers (32%, compared with 26% of employees and 19% of independent contractors).
Despite their higher net wealth and larger salaries, self-employed physicians were least likely to feel fairly compensated; 49% of self-employed physicians said they did not feel fairly compensated for their work, compared with 40% of employees and 40% of independent contractors.
“Self-employed physicians may be better compensated than others of the same specialty who are employees, so some of that may be perception,” said Mr. Scroggins. “Or they feel they should be compensated to a far greater degree than those who are employed.”
Self-employed physicians were also more likely to respond that they would choose the same practice setting again, though across all three categories, fewer than 50% of respondents would do so: 34% of self-employed physicians, compared with 29% of employees and 28% of independent contractors.