Rural Hospitalists Have the Earning Edge

January 5, 2011

A faster recruitment process and incentives for moving away from cities are among the reasons why rural hospitalists earn more, according to a new survey.

A new survey from Sullivan, Cotter and Associates finds that hospitalists working in rural programs earn an average of $19,000 more per year than those in urban areas, and $10,000 more than hospitalists based in suburban hospitals.

According to an article published in Becker's Hospital Review, rural hospitalists took home an average of $205,990 in 2010, compared to $186,735 for hospitalists in urban settings and $195,000 for suburban hospitalists. The median compensation in 2010 for rural internists was even higher at $210,750.

Kim Mobley, a managing principal at SullivanCotter, identified several factors that may contribute to the difference between urban and rural physicians. The difficulty rural hospitals face when recruiting specialists is the underlying issue beneath these differences.

"The recruitment process is much more complex. In New York City, you might get 50 applications for a specialist position, but in North Dakota you might only get two," said Mobley in the Becker’s article. With slow and difficult recruitment, it can take two to three years for some rural hospitals to hire the right physician. To some degree, rural hospitals may provide higher base compensation to simply attract physicians who may not want to move to rural settings.

Another component is the fact that rural areas typically don’t have teaching hospitals. "Teaching hospitals tend to pay less because the faculty has a combination of clinical and academic work," she said. The data on which these figures are based includes teaching hospitals.

A number of the rural hospitals reflected in these figures may be located in health professional shortage areas (HPSAs), or areas that are medically underserved, according to the data. Under Stark Law, hospitals within HPSAs may provide physicians with recruitment incentives. If physicians relocate their practice to the hospital's geographic area, hospitals may offer relocating physicians incentives if they meet certain requirements.

"This may include unique forms of payment, such as paying for loan forgiveness," said Mobley. An emerging practice is to use retention bonuses to retain physicians in this competitive physician labor market, she noted.

The break-down by specialty in terms of the difference between median rural, suburban and urban compensation levels is as follows:

  • Anatomic and clinical pathology: $345,770 (rural), $300,000 (suburban), and $197,795 (urban)
  • Diagnostic radiology: $478,000 (rural), $391,700 (suburban), and $359,090 (urban)
  • Radiation therapy: $466,130 (rural), $373,695 (suburban), and $358,210 (urban)
  • General surgery: $356,365 (rural), $319,815 (suburban), and $280,000 (urban)
  • Vascular surgery: $426,320 (rural), $324,400 (suburban), and $336,700 (urban)
  • Infectious disease: $227,750 (rural), $185,150 (suburban), and $178,675 (urban)

For more:

  • Rural Physicians See Higher Average Compensation Than Those in Cities, Suburbs
  • Hospitalist Salary Compensation Survey 2010 (SHM MGMA): The Rapid Rise Continues
  • MGMA: Hospitalist Productivity Improves with Lower Base Salary