Hospital jobs turning into a doctors’ market

Physicians are in demand by many hospitals and health systems, and recruiters say that gives doctors more leverage than ever to get the positions they want.

Nearly 84% of health care facility administrators and managers said their hospitals and health systems have physician openings. Sixty percent are experiencing a shortage of primary care physicians and 42% have a shortage of specialists, according to a survey by Merritt Hawkins, a physician recruiting firm. The survey interviewed about 400 managers and administrators.

Sixteen percent reported that their facilities are fully staffed with doctors.

Recruiters said that although there is a major demand for physicians, it won’t necessarily mean that employed doctors will be at the center of bidding wars. That’s because health systems and hospitals are under cost constraints, and federal Stark laws require hospital compensation for doctors to reflect fair market value. Hospitals often rely on locum tenens physicians to fill some of the void.

However, they said doctors can expect compensation to be on the rise in the coming years, especially among primary care physicians and other sought-after specialties. For now, physicians’ leverage with hospitals is more likely to come through negotiation of hours, call, duties and other nonmonetary issues. In addition, doctors are more likely to find a position in the region of the country in which they want to settle.

“I think you will see modest increases in compensation, because there’s just so much money to move around,” said Mark Law, group president of CHG Healthcare Services, a staffing company in Salt Lake City. “I think physicians will have more choices about where and how they work, but not in compensation.”

The effect of care coordination

The large number of openings for employed physicians at hospitals and health systems are due to several factors happening all at once, recruiters said.

Hospitals have been acquiring practices and employing more physicians because changes in health care are calling for care coordination, and facilities believe that will be easier if primary care and other doctors are under the same health system umbrella. If the trend continues as expected, Merritt Hawkins projects that in two years, 75% of newly hired physicians will be hospital employees.

Meanwhile, facilities have a lot of physicians to replace, as demand for doctor services is going up. About a third of physicians are older than 55, and a third of those will retire in the next decade, said Jim Stone, president of the Medicus Firm, a health care consultancy. This is happening as 11,000 seniors become eligible for Medicare every day, which is likely to drive up the need for physicians, he wrote in an email. Others point to the Affordable Care Act creating 14 million newly insured patients in 2014 and thus increasing doctor need.

The average number of hours physicians are working has dropped, meaning more doctors are needed to cover all shifts. Physicians are working 5.9 hours fewer than they did in 2008, according to the 2012 survey conducted for the Physicians Foundation by Merritt Hawkins.

That resulted in a loss of 44,250 full-time equivalents from the physician work force, according to the study. Physicians are seeing 16.6% fewer patients than in 2008. In the next one to three years, more than 50% of physicians surveyed plan to cut back on patients, work part time, switch to concierge medicine, retire or take other steps that will reduce workloads.

“The physician shortage is not an industry fabrication or a case of ‘The Boy Who Cried Wolf,’ ” Stone wrote. “This is a reality — a concerning situation that is not going to go away or improve anytime soon. The physician shortage is only going to intensify in the future as the patient population and physician work force continue to age, more patients become insured, and we all become more entrenched in the regulations of the ACA.”

Stone agreed that there probably won’t be huge spikes in compensation due to the shortage. But he said physicians will be able to shop around and play one offer off the other. Hospitals and health systems will be faced with a competitive market and will need to be creative when making offers to physicians, he said.

Recruiters said that probably means doctors can negotiate for more flexible time schedules, 40-hour workweeks, regular vacations and no call coverage.

“Even now, the most attractive incentive over income is flexibility,” said Phil Miller, vice president of communications at Merritt Hawkins. “When you talk to physicians, like everyone else, they want a positive work environment.”