The recent article, “29 Physician Specialties Ranked by Pay” from Becker’s Hospital Review, compares 29 physician specialties based on average annual compensation using data from the 2025 Medscape Physician Compensation Report, which surveyed over 7,300 physicians between October 2024 and January 2025. The findings were as follows:
Top 7 Highest-Paid Specialties (All earning over $500,000/year):
- Orthopedics and Orthopedic Surgery – $564,000
- Plastic Surgery – $544,000
- Radiology – $526,000
- Cardiology – $520,000
- Gastroenterology – $513,000
- Urology – $505,000
- Anesthesiology – $501,000
Lowest-Paid Specialties (All under $300,000/year):
- Internal Medicine – $294,000
- Rheumatology – $284,000
- Family Medicine – $281,000
- Infectious Diseases – $277,000
- Diabetes and Endocrinology – $274,000
- Public Health and Preventive Medicine – $269,000
- Pediatrics – $265,000
This ranking reflects long-standing trends in physician compensation, where procedural and surgical specialties dominate the top of the pay scale. These fields often involve high-risk, high-skill services that are commonly performed at facilities such as hospitals, ambulatory surgery centers, or other acute care facilities.
On the other hand, primary care and cognitive specialties like pediatrics, internal medicine, and endocrinology remain at the bottom, despite their critical role in preventive care and chronic disease management. This disparity continues to raise concerns about a growing shortage of primary care providers in the US.
Below are the key trends in physician compensation over time, based on Medscape’s annual reports from 2021 to 2025.
Overall Compensation Trends (2021–2025)
- 2021: Pay increases were modest due to the lingering effects of the COVID-19 pandemic, with many patients forgoing or delaying care due to personal concerns or limits on access to care.
- 2022–2023: Slight recovery with average annual raises around 3%, driven by post-pandemic demand and the delay of planned reductions in Medicare Physician Fee Schedule reimbursement.
- 2024: Growth slowed again. The average raise was 2.9%, with specialists seeing only 2.4%, the lowest since 2021, which was at least partly due to legislation aimed at controlling Medicare spending.
- 2025: Compensation remained relatively flat, with primary care physicians (PCPs) seeing a 3.9% increase, slightly better than specialists.
Specialty-Specific Trends
- Orthopedics and Plastic Surgery have consistently topped the charts for the past five years, driven by high procedure volumes and strong billing to commercial payers.
- Anesthesiology dropped slightly in rank in 2025 but remains in the top 10.
- Primary care fields (e.g., family medicine, pediatrics) have remained at the bottom, despite increasing demand and burnout.
- Radiology and Cardiology have seen steady growth, reflecting their procedural intensity and diagnostic importance.
Key Influencing Factors
- Reimbursement Cuts: Payer reimbursement reductions have squeezed specialist income.
- Hospital Financial Struggles: Many hospitals are facing budget constraints, limiting their ability to increase physician pay.
- Post-COVID Plateau: The salary surge seen during the pandemic has largely faded.
- Administrative Burden: Despite stagnant pay, physicians report no reduction in workload or administrative tasks.
As shown in the data presented above, physician compensation is influenced mainly by the level of complexity and acuity of the services provided by the physician. For physicians in private practice, the revenue generated by specialties that perform procedures or provide testing requiring a comparatively high level of expertise is generally greater than that of physicians who primarily provide evaluation, management, and consultation services.
Physicians employed by hospitals, health systems, or other organizations are often paid using production-based compensation models to create financial incentives that are tied to the level of effort required to provide the physicians’ services. Often, Work Relative Value Units (wRVU) are relied upon as a measure of Physician productivity. wRVUs are a component of the Centers for Medicare and Medicaid Services (CMS) Resource-Based Relative Value System (RBRVS), which is primarily used to determine reimbursement for physician services provided to governmental health plan beneficiaries. wRVUs are a measure designed specifically to reflect the work, effort, and intensity required of the physician in providing a specific service. These wRVUs are weighted by CMS based upon the type of service being provided, and therefore, the wRVU totals are often used to measure overall physician productivity.
A benefit of this compensation method is that the wRVU is a widely available standardized measure of the volume and complexity of services provided; a disadvantage is that even though this metric is commonly used to measure physician activity, it is not necessarily reflective of the impact that poor reimbursement rates, bad debt, or charity care have on physician compensation. Regardless, since the services provided by physician specialists commonly carry a larger wRVU weighting than office-based or non-acute care, the Medscape report’s list of highest-paid specialties is primarily represented by surgeons, cardiologists, etc., while primary care and other non-emergent physician specialties occupy the lower end of the listing.
In those cases where the economic circumstances are challenging for a specific hospital, health system, or other physician employer, compensation at a rate that is commensurate with the level of productivity and consistent within the market for any given physician can result in financial losses at the physician practice level. To the extent that such losses are unsustainable, organizations must either face the potential of discontinuation of certain services or:
- Take action to improve practice operations
- Evaluate third-party payor contracts
- Ensure physician network referral integrity
Regardless of whether practice level losses are not an immediate concern, the following are steps that every physician employer should proactively take:
- Periodically review that compensation plans are being administered correctly
- Verify that the terms and conditions of legacy physician employment agreements are consistent with the mission, goals, and objectives of the employer organization
- Confirms that total payments to employed physicians meet the standards of fair market value and commercial reasonableness, and are compliant with the Stark Law, anti-kickback statutes, and civil monetary penalties
- With many procedures shifting to outpatient/ambulatory surgery center settings, ensure that compensation plans for specialists are competitive within the marketplace and to reduce the risk of losing key physician specialties
- Evaluate the fair market value of compensation for low producers to determine if an alternative to a wRVU-based model is appropriate for those providers with strategic value in support of the employer’s mission
- Assess physician compensation at the service line level to evaluate the contribution margin, determine the impact on the overall organization, and explore opportunities for improvement for under-performers
Contact An Expert Today
If you require assistance with physician compensation plans, physician employment issues, or other physician practice financial matters, contact one of our experts today.
Alex Fritz, CPA/ABV, ASA, Director
Jeff Moffatt, CPA/ABV, ASA, CVA, FHFMA, FACHE, Senior Manager
