Why physician employment is ‘not sustainable’

Becker's Healthcare December 4, 2024
Patsy Newitt

Rising labor expenses and shrinking reimbursements are putting significant pressure on hospitals’ financial health, according to Kaufman Hall’s National Hospital Flash Report.

Here are five things to know from the report, based on data from 1,300 physicians:

1. Labor expenses per calendar day increased by 5% year-over-year in September. This sustained rise highlights ongoing challenges in controlling workforce-related costs.

2. Medical groups face mounting labor costs, with 84% of total expenses attributed to staffing, according to Kaufman Hall’s Physician Flash Report. Notably, the average subsidy per employed physician surpassed $300,000 for the first time, reaching $304,312.

“Investment/subsidy per physician rose above $300,000 for the first time — a sign that current models of physician employment are not sustainable,” said...

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