Do you know how much you are worth? MGMA salary data show pay variance

Practice administrator salaries increase, but so does responsibility

It was a good year for practice administrators in 1995. Inflation was below 4%, and according to the 1996 Management Compensation Survey by the Medical Group Management Association (MGMA), average salaries increased from $65,000 in 1994 to $69,375 in 1995.

While salaries varied from region to region and were dependent on practice size and education level (see chart, p. 30), there was a general upward trend in compensation, says Craig Stoner, chief executive officer at HealthCare Midwest in Kalamazoo, MI.

Some of the upward mobility can be seen in the change in titles that some practice administrators are receiving, he says. "You see more of us getting the title CEO." Stoner is one of the many practice administrators who have negotiated for the title change, but he admits that his duties — which include running the 15-doctor practice and planning a tripling of medical staff in the next year — might be handled by someone called a business manager in one practice or a chief administrative officer in another.

Just as those with similar duties may have different titles, those with the same title — practice administrator — may have different job descriptions, says Craig Marshall, CMPE, CHE, CMM, practice administrator of Associated Colon and Rectal Surgeons in Plainfield, NJ. "In a smaller practice, that person may do everything that is non-medical," he says. "In a larger practice, the practice administrator may only handle personnel issues." The difference in responsibilities results in different salary levels.

Marshall, whose practice has five surgeons and three residents, does "everything but cut people open." His salary is competitive with others who work for practices that bring in $2 million to $5 million in annual revenue.

"But the freedom I have doesn’t just happen," he says. "I decide what managed care plans to join, what equipment to purchase, what new policies are necessary, and act as the main point of contact for our accountant and lawyer."

That kind of freedom is built on trust that only comes with time, Marshall says. "When I started four years ago, I noted that the fee schedule had to change. I had to justify every change to the staff. Now, I don’t have to; I just tell them I am going to. That evolution takes place with increased experience."

Marshall says that one thing he has noticed is practices are placing greater importance on professional certifications instead of higher level degrees such as MBAs. Being a certified healthcare executive, a certified medical manager, or a certified medical practice executive can improve your salary expectations, he says.

Certainly people who have CMPE or FACMPE status earn more according to the MGMA survey, and Andrea Rossiter, vice president of member services at the MGMA, says membership in the American College of Medical Practice Executives (ACMPE) — a body which she oversees — has increased.

In 1993, there were 2,024 members of the ACMPE. In 1994, that increased to over 2,400, and by 1995 the membership stood at 2,738. There are about 100 candidates for CMPE each year and 30 for fellowship in the college, says Rossiter.

"We don’t have true data, but anecdotally we know that [it is easier for] administrators with our credential to find positions and earn more money," she says. "Certainly the higher salaries they earn are an indicator that credentialing is increasingly important."