$600 Billion

The new doctor compensation numbers for 2010 are out. Time to update the most and least attractive specialties from a compensation standpoint.

(for background on this post, please see the original post on doc comp here.

Some of the more attractive specialties from 2003-09 look less attractive today — Emergency Medicine tops this list. On the flip side, Non-invasive Cardiology and Ortho remain very attractive while Dermatology compensation is rebounding strongly.

As a reminder, here is the old matrix of specialty attractiveness up to 2009:

The main takeaways from this old dataset were as follows:

1) Highly specialized doctors have the most attractive compensation, but also have to deal with the potential for lower IRR’s (because of a longer term in low-earning fellowships, etc.) and greater year-to-year earnings fluctuations.

2) Hospitalist and Emergency Medicine, while less well-paid than specialists, scored highly due to good earnings growth and low volatility in earnings power.

3) Some specialties — chiefly Derm and Anesthesiology — were well-paid but pay was not growing. A potential reflection of either doctor oversupply, lower demand trends, or nurse-specialist substitution, lower earnings growth boded poorly for the future of some specialties.

The new 2010 data brighten the outlook considerably for some specialties, and throw cold water on others. Here are the new data from 2003-10:

There are some significant shifts in the attractiveness of specialties.

Biggest Loser: Emergency Medicine

Anecdotally, EM is a popular field for new doctors that I know due to its shift-based work, daily novelty, and reasonable pay. Longer term, the issues with this specialty from a compensation perspective are troubling. There is no tight control of emergency medicine fellowships, ensuring that doctor supply will grow and possibly push down wages. (Contrast the situation with Dermatology, where even though Derm fellowships are in high demand, the supply of fellowships is tightly controlled). Demand for emergency medicine may also be soft going forward. With the advent of healthcare reform and vertically-integrated, accountable care models, the emergency room will no longer be the profit center it is today, potentially reducing demand for emergency medicine doctors. The last issue is that emergency medicine docs are nearly all hospital-employed, and so will find it hard to make more money outside of working more hours (increasing supply more and lowering hourly wage…). It could be a vicious circle.

These structural trends in emergency medicine may be rearing their ugly heads. 2010 compensation data show that the average compensation for an EM doc fell a whopping 13% in 2010. Med students BEWARE!

Biggest Winner: Dermatology

No need to dwell on this one. Dermatologist supply is tightly controlled by a dearth of fellowships. And the number of procedures that can be performed by dermatologists continues to expand (the latest and greatest appears to be in-office radiation therapy for benign skin cancer). Dermatologist earnings are very high. But in the past few years, earnings growth was slow. Part of this slow growth must have been caused by cuts to Mohs surgery reimbursement and aggressive utilization control by managed care. The result was the surprising ranking of dermatology in the lowest attractiveness tier last year. How things have changed. Derm docs saw an average 13% increase in compensation in 2010, rocketing the specialty from the lowest attractiveness last year to the highest.

Flavor of the Week: Non-invasive Cardiology

It’s unclear whether the definition of ‘non-invasive’ cardiologist includes cardiologists that do diagnostic catheterizations. What is for sure is that non-invasive cardiologists saw an 8% earnings bump this year, pushing average yearly comp up to $418k per year. It’s not hard to speculate on the sources of the large increase — nuclear imaging stress tests for Baby Boomers, movement of cath labs to the outpatient setting, and physician equity ownership of imaging equipment. Is it possible that fewer new docs are entering the field because heart disease is increasingly viewed as ‘conquered.’ I don’t know. But it seems like aspiring new doctors should give non-invasive cardiology a whirl, as compensation trends remain positive.

Take a look through the new table and tell us what you think.