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Income and expenses and lifestyle

  • 1.  Income and expenses and lifestyle

    Posted 10-11-2017 12:45
    I feel this is an elephant in the room and hope we can have more open honest discussion about it.  Most people in IMP recognize the personal rewards and value of being in a small independent practice.   But, unless we can share the possibility of earning a decent living, few will choose that option.

    Hopefully, some of us will post their income and expenses.   We will learn from each other about how to save.   How work flow and time per visit affect income.  I have always felt that scheduling two patients per hour keeps me off the treadmill, my overhead is much lower and calls almost non existent.   I see 12 to 14 patients per day.  I was influenced by the Gordon Moore articles years ago.

    I recognize it is uncomfortable discussing our income, even humbling when you read the "average income" for FPs and "specialists" that we all see in Medical Economics and other journals.  When I look at recruitment ads for primary care, especially in certain areas of the country, and in large multispecialty groups, I see some starting salaries around $225K plus benefits.

    Many years ago, there was a thread on the IMP forum about income and expenses.  I found it helpful.    I have worked to keep overhead low.

    I stated in another post that I earned approx $40K per year for each day I work in office.  I currently work 2 days per week in my office, which equates to approx 80K per year earned in my private office.

    In fairness, I do work outside my office 1 day per week, and my needs are much less then new grads.   My children are through college, mortgage mostly paid, wife also works, etc., and when I started, most FP grads went into private practice.   So here goes:

    Annual expenses = 82K
    32 - Employee
    15 - Rent  (sublet)
      6 - Malpractice "part- time"
      5 - tel, internet,
      3 - Electric
      3 - billing software
      0 - EMR (PF and paper charts)
      4 - cleaning
      4 - supplies
    10  - misc - (computer equip and support, accountant, ins., medical waste, etc )

    160K income approx 13.5 per month

    I realize all our situations are different but hope others will share info.

    Michael S. MD

  • 2.  RE: Income and expenses and lifestyle

    Posted 10-20-2017 04:11
    Another thing pointed out by Gordon throughout his tenure with IMP was that there is great variability in income and expenses across the country. I practiced as a solo IMP from 2005 until last month. For me, my expenses were higher and my income lower. $40,000 per day in the office would have been great for me. I did all the meaningful use and PCMH stuff, I got pay from Anthem above my ffs, I did my own billing etc... I was working 5 days a week seeing patients and the management of my office took 2-15 hours more per week (the higher end when we were completing meaningful use of PCMH paperwork). I also worked at our state level on the state payment reform (unpaid) to try to improve things here. For the last two years I have been in a slightly bigger office and added a nurse practitioner and the expenses that go along with another clinician.  I just never could get over $70,000 a year in income and was working so much that I decided to sell my practice. I'll write another post about what I'm doing now.

    Kris Oaks
    Kristin L. Oaks D.O. Inc.
    Worthington OH

  • 3.  RE: Income and expenses and lifestyle

    Posted 10-22-2017 14:16
    -$103,000.00 Barrons Salary
    -$60,005.00 NP salary
    -$13,233.00 Secretary Salary
    -$16,695.00 Rent
    -$10,667.36 Malpractice
    -$1,080.00 Credit Card Processing
    -$1,378.26 Office Phone
    -$1,333.56 cellphones
    -$1,292.75 Updox
    -$1,735.98 Sanofi (Vaccines)
    -$288.00 ePrescribing (eDoctor)
    -$780.00 Internet
    -$1,415.25 Gateway EDI (clearinghouse)
    -$300.00 IT contractors
    $0.00 Conferences
    $0.00 Elance Contractors
    -$250.00 IMP Membership
    -$31,062.67 Other (lazy accounting)

    I practice in St. Louis, Missouri.  I take Medicare, commercial and Medicaid.  This was from 2015 which was the last year before my Medicare Advantage payments started happening.  My nurse practitioner works 3 days per week and my secretary is full time.  I get my health insurance through the Army Reserve (Tricare), about $200/month for the family.  It also provides another $10K income on years when I have not deployed.  Both my employees get their health insurance through their spouses.

    I worked 5 days a week seeing patients, took call 24/7 all year, rounded on my patients in the hospital, and did admin stuff mostly on the weekends.  I worked 50-60 hours per week.  I took 3 weeks vacation.  This didn't seem like a bad deal at all to me because the pace of my day was pretty relaxed.  I found working 3 12 hour ER shifts per week harder mainly because the pace was much faster and the intermittent night shifts.

    Avg visits per day (MD and NP combined): 11-12
    Revenue per visit $105
    Expenses per visit $60

    Michael Barron
    Barron Family Medicine
    University City MO

  • 4.  RE: Income and expenses and lifestyle

    Posted 10-29-2017 13:34

    I think we're all about the same and nothing has change in the last 15 years. There is this mirage and promise of switching to value based care and that the metrics/PCMH we are furiously trying to measure and report are going to yield something.
    We are currently still at volume based care.
    As IMPs we chose to cut our volume and pay for flexibility and balance in our life.

    The "average" and recruitment salaries that are often posted no doubt come with the volume to support it. We could all answer an ad, potentially sell or integrate our practices or take an employed position if we wanted to.
    Employed positions may give us higher salaries but we will either be patient mill or chain gang. It seems like more and more the employed positions don't push on volume but focus on process, metrics and quality and downstream revenue from having primary care patients in the system.

    If we want to increase our salaries, we will need to see the same old 80-110 patients per week that was required of us years ago or we have to have an alternate revenue stream.

    $80K on Mike S is thus far the highest for 24-28 patients per week.

    I need to see 35-55 patients per week to make that.
    I agree with Mike B overhead about 60% for this low volume.

    My rent is $3750 per month going up to $4000 and I probably chose a space that is too large for me, but I still like it. I did the 1200 sq. foot office for 3 years and wanted to upgrade. I have 3 years left on my lease but I might consider integration with a hospital if it is offered to me (congrats Dr. Oaks). I did provide health insurance and good hourly pay to 3 employees (including myself) in 2017 but not sure what will happen to health insurance next year. Practice Fusion is free and my billing that I personally do through NueMD is about $200-$225 per month
    I, too, have a part-time NP as of this year and take all my own call.
    We do our own cleaning!!! Ugh. Roomba it is. 

    Mamatha Agrawal, MD
    Family Doctor CaryNC
    Cary, NC
    Live in Raleigh, NC
    Solo since 2012
    Practice Fusion and NueMD

  • 5.  RE: Income and expenses and lifestyle

    Posted 11-03-2017 06:47
    so  no kids
     breadwinner in family
    spouse has Small retirement and just began Ss and medicare  GO medicare!
     I make  more than Mike
    This yr I will make it looks like $ 5,000 more than last yr Income steadily  goes up
     overhead is 28%
     rent is 710/mo incl elec and  heat Snowplowing costs alot!
     5 hrs a week help at 15/hr
     outsource billing usually 700 a mo can be less ormore
      malp about 5000 a yr I think
    I run the place on a shoestring making the  christmas wreath and refusing to  splurge on  mums in the fall etc
    I do pay for cleaning
     health insurance keeps me from getting  ahead For me only 780 a mo now 5500 deducitble going ot 930 or something !1  Furious about thatt! Drive a used car I paid cash for, Am  ahead on mortgage hope to have it gone in under 4 yrs  at which time I tell NCQA where they can go

     see 10 people a day 4 days a week Sometimes less or moreDo evisits
     have good life balance Am tired

    Jean Antonucci

  • 6.  RE: Income and expenses and lifestyle

    Posted 11-22-2017 08:15
    clarification I make  a little more than Mike B     Mike S makes  more than me

    Jean Antonucci

  • 7.  RE: Income and expenses and lifestyle

    Posted 02-28-2018 13:49
    I started this forum a few months ago asking members to post their incomes and expenses and lifestyles.  The response was not huge but I have one more practice figures to report.

    This doctor provided me figures, but asked that I post them anonymously.   I was busy and did not follow thru, but here goes a very simplified version.  For the sake of time, I will not break out rent, benefits, salaries of midlevels and staff, etc.

    This is a busy practice with one physician owner and 2 midlevels.  The physician's take home after all expenses, non-owner salaries, and benefits are paid is approximately 350K.    Clearly this is not a solo practice with little or no staff, but it is worth knowing that it is possible.

    Hopefully a few others will post some figures.

    Michael S. MD

  • 8.  RE: Income and expenses and lifestyle

    Posted 03-13-2018 10:17
    So since reporting my 2015 financials, I now have 2016 and 2017 under a risk based contract with a local Medicare Advantage plan.  I can't disclose specifics but a diligent PCP should average around $150 per member per month.  This is obviously much better than the $30-40 you get with fee for service.  As Larry Lindeman told me at a conference a couple years ago, Medicare fee for service is a terrible deal financially for the doctor.  These patients are a lot of work; you're better off going Medicaid only.  The risk based contracts, however, are worth it.  There is the quality stuff and one ends up doing a lot of outreach, but I think being measured in this way is kind of fun.  You need about 100 patients and a decent reinsurance scheme to survive the various ups and downs driven by luck.

    Michael Barron
    Barron Family Medicine
    University City MO

  • 9.  RE: Income and expenses and lifestyle

    Posted 03-13-2018 18:06

    Congratulations.  That sounds wonderful.   $150 x 100 patients x 12 months = $180,000 per year.   I am jealous and it raises many questions.

    Can you explain a little more how that works without being specific with name of advantage plan?

    Did you approach the Advantage plan and make a proposal?   Did they approach you and why?
    Did they offer this to all enrolled pcps in your area?

    Are you capitated based on patients age, risk factors, diagnosis?

    How are patients assigned to you?   Do you encourage your Medicare patients to select the plan and pick you as their primary MD?  I presume they have to pick that Advantage plan.

    How much risk do you assume?

    Do you receive feedback on your utilization?

    I am sure there are many more questions I could come up with.


    Michael S. MD

  • 10.  RE: Income and expenses and lifestyle

    Posted 04-07-2018 15:20

    I approached the plan and they referred my name to an IPA that contacted me.  I was given the same deal that all the doctors involved get.  Medicare pays the plan based on the diagnosis codes billed for each year, age, and Medicaid eligibility.  The official term is a RAF score.  The plan releases a monthly amount to help with cash flow, and then once a quarter a reconciliation is done usually from several quarters back.  The patients find me just like in other plans, some random, some referrals from existing patients.  Some existing patients convert to the plan either from plain Medicare or when they become eligible.  We can't steer patients into the plan so I just suggest they see a broker if they ask about it.

    The doctor is liable for all the costs, so it is possible to lose a lot of money.  Doing business as usual does not work, but IMP principles are very effective (comprehensive care, continuity, access, and care coordination).  To limit the damage from individual patients cost sharing among doctors in my IPA helps.  We also pay the plan for reinsurance on high cost patients.  We get very detailed information on costs, including drugs, which can be compared to various baselines such the overall plan, other doctors in IPA, and my own past.  This is based on claims so there is the typical lag.  My group employs case managers that monitor admissions to hospitals I do not attend; this is quite helpful as well.

    Hope that helps.

    Michael Barron
    Barron Family Medicine
    University City MO

  • 11.  RE: Income and expenses and lifestyle

    Posted 04-08-2018 06:29


    In the proposal I submitted  to  the PTAC  which I mentioned here before and this will just confuse some of you.. but it  is thought to be good and I hope I get to Washington.. anyway My friend Bob Berenson from theUrban Institute who came to IMP camp once= he taught me that capitation IS  risk so you have to risk adjust  which  I cannot tell if mike has done  Currently the HCC codes are stupid for this  You also  should cap panel size becasue you can take in a lot but if you ar e not as smart as Mike Barron you then  have too many folks to take  good care of them  Mike seems to  take insurance risk as wlll as performance risk I wonder how much risk he is up for? There  should be some limit  Physicians cannot assume risk for total  cost of car  Interesting times we live in  Mike seemsto be very  good at this stuff
    I have been capitated by one Medicare advantage plan for yrs with an incentive plan   It is ok but too low now but I dare not approach the new leadership which would probably not let me continue   I fly under the radar The old innovative supportive folks are gone The incentive plan nets me very little and I never get credit for the things in it

         Jean Antonucci MD
         115 Mt Blue Circle
         Farmington ME 04938
    ph 207 778 3313   fax 207 778 3544


  • 12.  RE: Income and expenses and lifestyle

    Posted 04-09-2018 06:20

    So, to make sure I understand, they pay you a flat rate monthly per covered life ($150); and from that, you are required to provide care for each patient to best of your ability. If they are well, you can make money. But if their medical expenses climb, YOU LOSE money. You are able to spread that loss to other doctors in your group, but are still responsible in essence for covering the "loss"?  And essentially, through that sharing, YOU COVER (a share of) THE LOSSES from the "expensive" patients other docs care for. And then furthermore, YOU PAY the insurance company to insure your assigned patients against more extreme situations to prevent a large loss?

    I realize this is the basis of capitation; and shared risk is part of it. But is it just me, or have you basically agreed to insure the patient for a monthly fee?  Aren't you accepting most of the risk for the insurance company when you accept that fee?  And then, you are even paying for the extreme expense insurance? I'm sorry, but it just seems backward for YOU to be paying to insure a patient who seeks your services. The patient/government/employers pay the insurance company. Then you pay them even more (to cover these extremes); but for the flat fee you accept, you take on much of their risk.  Maybe it works well in some cases; but if the law of averages plays out, who is in a better position to limit losses, the insurance company or the docs? And who has the funds to sustain losses that might come?

    I'm not trying to be a stick in the mud; but how does this really help your practice?  Is the "steady income" worth the risk?

    Michael R. McLeod, MD
    (yes, that's correct. Another "Mike")
    Opening New clinic 6 months from today in South Texas and trying to make sure its in the best position to succeed; 'cause after 19 years of practice, it's time to get set for the last 18 years of my career with a profitable AND fulfilling primary care practice.

    Michael R. McLeod, MD
    Victoria TX

  • 13.  RE: Income and expenses and lifestyle

    Posted 04-09-2018 16:44
    Dr Barron (to remove ambiguity on which 'Mike'),
    Is the IPA a Medicare Advantage-type plan? Or are they fully capitated from one? What's the individual PCP risk limit, and what are you as a PCP responsible for?

    Medicare Advantage plans get paid global capitation based on the HCC score, so it's advantageous for them to have you see them and record as many diagnoses as possible. Does that similarly change the capitation for you?
    The variance in the number of primary care visits has about 1/10 the variance of total costs.

    HCC is about as good as any other risk predictor- even though it only predicts about 30-40% of the patient cost variance.

    Peter Liepmann MD FAAFP MBA
    My mission is to fix US health care
    Bakersfield CA

  • 14.  RE: Income and expenses and lifestyle

    Posted 04-10-2018 07:10

    Yes, Medicare Advantage plan that contracts with the IPA.  There is no risk limit in aggregate, but for each patient there is cost sharing among docs in the IPA and above that reinsurance from the plan.  We are responsible for all costs including pharmacy.

    You are correct about the HCC scoring (RAF score).  It is important to capture as many of the applicable diagnoses as possible since each one conveys risk.  If I miss one, then I accept the risk but don't get paid for it.  Interestingly, a truism in this industry is that the more primary care visits a patient has, the lower the average costs will be, and therefore the more money the doctor makes.  This extra attention increases one's pay significantly.

  • 15.  RE: Income and expenses and lifestyle

    Posted 04-10-2018 07:01

    The flat rate is much higher and is determined by Medicare based on the patient's RAF score.  We get more money for sicker patients.  I forget what the national average is, but each Medicare patient costs about $10-12,000 per year, so we have to pay for their expenses out of that pool.  The insurance plan also gets some administrative costs.  Whatever is left over goes to the doctor, if there is anything left over (hence the risk).  Results vary but in the current environment a primary care doctor should be able to average $150 per member per month.  Some years will be better and some worse.  

    I am definitely insuring the patient for a fee.  All of the risk is on me.  Luckily the primary care doctor is in the best position to affect spending by preventing hospitalizations and ER visits, limiting complications of chronic disease, establishing a relationship with patients that leads them to better health.

    Your points about why I should be in this position are valid; it is far from an ideal arrangement.  However, I think it is the best option for contracting with Medicare.  Fee for service does not pay enough to care for these patients.

  • 16.  RE: Income and expenses and lifestyle

    Posted 03-14-2018 05:55

    Can you elaborate more on "a decent reinsurance scheme"? Have you tried to/been able to get reinsurance for your patient panel? If so, would you be willing to say with who/costs/whether you had to use and if you did have to use, whether it worked ok?


    Jeff Huotari

  • 17.  RE: Income and expenses and lifestyle

    Posted 03-15-2018 07:20

    I have 3 levels of insurance that cover different ranges of expenses.  The first 2 are simple arrangements where the docs in an IPA simply divide the costs in the covered range and pay in to cover those costs on a per member per month basis.  The last level of insurance is provided by the medicare advantage plan itself.  All the participating docs pay a fee for that protection.  

    The plan has a contract for a level above that for the really expensive cases.  Unfortunately the costs of these high level plans provided by reinsurance companies have gotten very expensive apparently.

    If you think there is a group of doctors in your area that might be interested in forming a new MA plan, there is a company called Lumeris that provides consulting services aimed at getting new MA plans off the ground.  They can provide more details for a cost.  I have no relationship with them other than using some of their software for the plan I'm in.