This week’s graphic dives into a growing challenge facing health systems’ physician enterprises. According to Kaufman Hall’s Physician Flash Report, the median physician subsidy increased 3% between Q2 2023 and Q2 2024, bringing the subsidy up to nearly $300k per full-time equivalent physician. When looking at both physicians and advanced practice providers (APPs), the median subsidy per provider was a more palatable $232.1K, but that figure is also 3% higher than last year. Increasing expenses, particularly labor costs, are notable factors driving these losses. Additionally, subsidies vary greatly by specialty, with median physician surgical subsidies more than double those of primary care physicians. Across specialties, provider subsidies were much lower than physician subsidies, with median subsidies in the surgical provider workforce cut by roughly one third when accounting for APPs. As provider subsidies continue to rise, many systems are placing a greater emphasis on APP productivity as a way to manage their returns on investment in the physician enterprise space.
