Physician Assistant Compensation Increased 50% Faster than Inflation

Physician assistants have never had it so good – a rapid growth in demand and compensation like never before, according to multiple studies in 2015.  Even with a nationwide shortage of doctors required to treat millions of newly insured Americans, the demand for physician assistants is growing with compensation averaging $100,000 across the U.S.

Nationally certified by the commission and licensed in the states where they practice, a physician assistant generally has a two-year master’s degree, often from a program that runs about two years and includes three years of healthcare training.  They work in doctor’s offices, retail clinics and other locations and their work includes diagnosing illnesses, writing prescriptions and counseling patients on preventive care.  Physician assistants and other allied health professionals like nurse practitioners are increasingly an integral part of value-based care models proliferating across the country like Accountable Care Organizations (ACOs) and patient-centered medical homes that contract with insurers, Medicare and Medicaid programs.

According to a report from the American Academy of PAs (AAPA), physician assistants saw a 3.4 percent increase in median provider compensation between 2014 and 2015.  The study indicates that the increased demand for physician assistants led to increases in their compensation in 2015.  Gathering feedback from about 16,000 respondents, the 2016 AAPA Salary Report revealed rapid growth in the physician assistant workforce, with the profession increasing by more than 33 percent between 2010 and 2015.  Since 1980, this workforce has doubled in size every decade.  The study found that the median annual salary for physician assistants was $97,000 in 2015 and the median hourly wage came to $55, with about 78 percent of physician assistants receiving a salary, 18 percent paid hourly and 3.7 percent receiving compensation based on productivity.  Physician assistants who were more likely to be paid hourly were found to be generally working in urgent care, emergency medicine and convenient care.



According to the researchers, the highest paid physician assistants with a $120,000 median base salary were employed in hospital critical access departments, followed by those in industrial facility and work site settings ($114,003) and hospital intensive care and critical care units ($108,000).  The study also stated that provider compensation for some physician assistants included bonuses, with about 49 percent of full-time clinically practicing physician assistants earning a bonus payment in 2015. 50% of those providers reported a bonus of $5,000 or more.  Bonuses were given based on a variety of factors, including milestone achievements, employee performance, practice performance, collections productivity, relative value unit productivity, incentives, and holidays.

The study indicated that physician assistant compensation has consistently risen faster than both the national inflation rate and most other professions, with provider compensation for physician assistants increasing approximately 50 percent faster than the rate of inflation between 2000 and 2015.  The good news is that despite significant growth in workforce and compensation rates, the demand for physician assistants remains high nationwide.  According to The Bureau of Labor Statistics, physician assistant job demand should grow by 30 percent between 2014 and 2024.  The Association of American Medical Colleges projected that the industry will fall short by 61,700 to 94,700 physicians in 2025.

According to another healthcare employment study from Health eCareers, physician assistant compensation grew by 4.3 percent and demand for physician assistants and nurse practitioners increased due to physician shortages.  With payment reforms promoting more access to preventative services and about 54.8 million Americans touching the age of 65 by 2020, healthcare organizations are seeking more providers to add to their staffing rosters.  However, many are finding it difficult to hire and retain providers because of physician shortages.  According to the study, in order to offset a lack of physicians, healthcare organizations have opened new physician assistant and nurse practitioner positions.

According to Jennifer L. Dorn, AAPA CEO, “The growth of the PA profession in terms of size and compensation is just the tip of the iceberg.  PAs are going beyond just healthcare by taking on new leadership roles in health systems around the country.  They are well positioned to drive change as the US healthcare system adapts to a growing and aging population, the shift towards value-based care, and a renewed focus on patient education and prevention. In short, the state of the PA profession has never been stronger.”


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