How Much Do Medical Practice Managers Make: A 2011 Update

 

 

 

My post from 2010 on how much healthcare managers make is one of my most-visited posts ever. It’s time to revisit the data and talk about the direction healthcare jobs are taking.

First, some clarification on Office Manager, Site Manager and Practice Administrator titles and job descriptions.

The Office Manager title applies in two situations:

  1. The first is the top position in a small medical practice (three physicians or less) supervising at least two employees. In addition to managerial duties, the office manager often functions in a full-time or part-time staff position, either at the front desk or as a biller. The Office Manager in this situation does just about everything including the three Ps – Payroll, Payables and Purchasing.
  2. The second situation is the #2 position in a larger practice. The title could also be Assistant Administrator or Operations Manager. This person is responsible for all day-to-day operations, human resource functions and all department activities. S/he typically directly supervises all supervisors and leads and/or all staff if no middle management position exists.

A Site Manager or Site Administrator is responsible for one or more locations of a multi-location practice or a group of hospital-owned practices. S/he has all the responsibilities of an Office Manager for the day-to-day operations of a practice, but typically has a central support system. Duties deferred to the central support may include finance, human resources, billing and purchasing. Policies emanate from central administration, therefore the Site Manager does not have the autonomy of the Office Manager or Practice Administrator.

A Practice Administrator (sometimes called Executive Director) is not only responsible for the overall management of a practice or group of practices, s/he is also responsible for evaluating revenue and expenses, contracting with payers, strategic planning, provider recruitment and marketing. This person rarely has routine clerical duties, although s/he may coordinate or oversee payroll, payables and purchasing.

2010 Wages for All  Ambulatory Medical and Health Services Managers

Hourly Median – $37.19 (Annual $77,350)

Hourly Mean – $42.97 (Annual $89,390)

The median means that 50% of the jobs surveyed paid less and 50% of the jobs surveyed paid more. The mean is the average of all wages. The Practice Administrator position described above relates most closely to these rates, ranging from $77K to $89K, with smaller practices paying and entry-level managers making less, and larger practices paying and experienced managers making more.

The wages above, provided from the United States Department of Labor, include the following categories:

  • Offices of Physicians
  • Offices of Dentists
  • Offices of Other Health Practitioners
  • Outpatient Care Centers
  • Medical and Diagnostic Laboratories:
  • Home Health Care Services
  • Other Ambulatory Health Care Services

Keep in mind that independent medical and dental offices often pay less than than hospital-sponsored practices and entities, although work schedules and benefits in private healthcare entities can be significantly better.

My observations on raises for healthcare managers for 2011:

  • Most medical practices and hospitals have had a freeze on raises or reduced raise budgets of 2% or less for the past 2 years. Some hospitals are giving managerial positions a small raise to retain good managers.
  • Some private practice managers have had raises or small bonuses based on target metrics, increased responsibilities, mergers and launching of new service lines.
  • Some managers will only see increases by changing jobs, which can be risky while the economy is still in recovery.

Observations on healthcare jobs from the Bureau of Labor Statistics

  • Ten of the 20 fastest growing occupations are healthcare-related. About 40% are in hospitals; another 21 percent are in nursing and residential care facilities; and 16% are in offices of physicians.
  • Healthcare will generate $3.2M new wage and salary jobs between 2008 and 2018, more than any other industry, largely in response to rapid growth in the elderly population.
  • Most healthcare workers have jobs that require less than 4 years of college education, but health diagnosing and treating practitioners are highly educated.
  • Management, business, and financial operations occupations account for only 4% of employment in healthcare.
  • Wage and salary employment in the healthcare industry is projected to increase 22% through 2018, compared with 11% for all industries combined. Healthcare employment growth is expected to account for about 22% of all wage and salary jobs added to the economy over the 2008-2018 period. Projected rates of employment growth for the various segments of the industry range from 10% in hospitals, the largest and slowest growing industry segment, to 46% in the much smaller home healthcare services.
  • Over the 2008-2018 period, total employment of home health aides is projected to increase by 50%, medical assistants by 34%, physical therapist assistants by 33%, and physician assistants by 39%.
  • Hospitals continue to be the slowest growing segment within the healthcare industry because of efforts to control hospital costs and the increasing use of outpatient clinics and other alternative care sites.

Posted in: A Career in Practice Management, Human Resources

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31 Comments

  1. Kelly McMillian June 19, 2011

    I am getting ready to go to college for health information management, I was wondering if it was the same thing as a medical practice manager. The school website said the average starting salary was $20,000. I was wondering if this was true? Thank you for your time.

    -Kelly McMillian

  2. Mary Pat Whaley June 19, 2011

    Hi Kelly,

    A degree in health information management is a good basis for someone who aspires to become a medical practice manager. In addition to HIM, you should study technology, billing and coding, accounting, and human resources, among others. I agree with your school website on the average starting salary for an entry-level position in HIM.

    Best wishes in your studies,

    Mary Pat

  3. A. B July 25, 2011

    Mary Pat,

    I am a Business Manager for a Medical Practice with two Physicians. I have been there 10 years. I am responsible for everything. Would Business Manager be the appropriate title for this position ? I am responsible for turning in payroll, payables, billing claims and posting remits and all Insurance claims, hiring and managing staff, filling in positions where needed, Coordinating business Orders, Marketing, Website, etc. As well as monthly reports for the Physicians.
    Also, what is the average salary for an experienced person like myself? Thank you

  4. Mary Pat Whaley July 26, 2011

    Hi A.B.,

    Many factors come into play with a manager’s salary. The specialty of the physicians, the profitability of the practice and how the practice benchmarks against other like practices, as well as the location of the practice and the complexity of the local healthcare market can cause a manager’s salary to fluctuate $25K above and below the median. Your salary could be anywhere between $40K and $80K depending on these factors. As far as titles, they matter most when looking at a salary survey and trying to pin down the exact nature of the responsibilities and tying them to salary. I can’t be more specific without knowing your exact situation.

    If you feel that you are being underpaid, make a case based on your contributions, the practice benchmarks and how much money your physicians take home.

    Best wishes,

    Mary Pat

  5. C.E. November 28, 2011

    Hi Mary Pat,

    I have been hired on as a practice manager for a Gastroenterologist. I have been here for about three months now. There is one physician, 4 staff members, the billing team (which is outsourced), and myself. I supervise the staff as well as the billing team. The doctor is out of the office the majority of the week due to procedures, so I am left in charge of the entire practice. All duties performed by the staff as well as the billing team are supervised by myself. I am also in charge of expenses, payroll, marketing,etc. I am a degreed individual, however my degree is a B.S. in Psychology with a minor in Health, so I do not hold a business degree, but have been in a magagement position for 3+ years. I am currently being paid under 30k and believe I am being underpaid. The practice has two locations held inside two very well known hospitals and is a very successful practice. Can you shed some light on what my salary should be and how I should approach the situation? Thank you so much for your time.

  6. Mary Pat Whaley November 29, 2011

    Hi C.E.,

    I am not sure if this is your first job in management in healthcare or not, but that could be one reason why you were started at a lower rate. I do agree with you that for the responsibilities you are entrusted with, less than 30K seems unusually low. If you haven’t already, I suggest you check with your state or local Medical Group Management Association (MGMA) to see if they have a benchmark for salary for a manager in a comparable situation. The national MGMA (www.mgma.com) also has detailed information, however you need to be a member to receive the information for free. If you know someone who is a member, they may be willing to share some information with you. PAHCOM (www.pahcom.com), a medical management organization for smaller practices is another great resource for information. Membership in their organization might be a good investment for your practice to make on your behalf.You can also go here: http://www.bls.gov/oes/current/oessrcst.htm to see wages by occupation by state, but the information will be less specific to your situation.

    Do your research and try to compare job descriptions as much as possible. Take this information along with what you’ve accomplished in your time in the practice to the physician and ask him for an adjustment to your base or a combination of an adjustment and a bonus based on performance if you have not talked about that before. He may not be willing to make a significant change if he does not feel that he has a good sense of your contribution, so I wouldn’t be surprised if he asks to leave things as they are until you’ve completed six months of employment. If he does, do not hesitate to ask for a meeting at six months and present a list of your accomplishments.

    Good luck!

    Mary Pat

  7. THERESA ENGLAND-GREEN January 2, 2012

    I was initially hired at this physician practice as an Insurance Specialist. At the time I was hired, there were three physicians but know it has dwindled down to one physician. For the past two years, I have been working in the capacity of the Office Manager at my same rate of pay. The titled Office Manager has not resigned, still getting Manager’s pay and hardly works 15 hours a week. Know, that the titled Office Manager is barely going to be there on a weekly basis, I feel that I should be payed for this position. Raises for the year are due to go into affect on January 15, 2012. Should I ask for a raise or wait for the boss to approach me? I have been in the medical field since 1992. I have a Bachelor’s of Science in technical Management as well as having a double Master’s degree in Public Administration and Human Resource Management. Also, what kind of salary do you think I should be making?

    Thanking you in advance for your advice

  8. Mary Pat Whaley January 5, 2012

    Hi Theresa,

    Your situation sounds very problematic. If there is someone in your office that has the title and salary of the office manager, yet you are doing the actual work, something is terribly wrong. Without knowing more about the situation, though, I can’t advise you about speaking to the boss (is that the physician or the office manager?) What worries me about your situation is that you don’t know why things are terribly wrong. There’s always more to story and we never know what we don’t know about why a situation is the way it is. I don’t know if you want to move on, but with your degrees and your experience, it certainly seems as if you could find another job where your title and pay are more in line with your experience. I cannot advise you on your salary without a lot more information.

    Best wishes,

    Mary Pat

  9. Yoany G. January 27, 2012

    I currently have 10 years plus of entry level Medical Billing experience. In the past I have also worked as an Office Assistant Manager. I am now 30 years old and have reached the point where I feel like I must be bigger than what I currently am. I have the ability of becoming a Healthcare Manager now, but strongly feel like I need a stronger educational background than just holding a Billing/Coding Certificate. I signed up for Health Science Business Administration Management and want to make sure I’m gong down the correct path. Please help me…

  10. Karen January 28, 2012

    Hi,
    I am currently a 2-department manager at a large medical facility where I have worked my way up over 13 years. I was recently approached about an outpatient manager position for a large group within this facility. I believe there will be approximately 20 physicians, 5 Clin. MOA’s, 8 RN’s, and 6 care tech’s at least under my supervision to support and or manage and 5 in/out departments to support.
    I do revenue/volume management, expense, capitol, project management, etc… and expect to do the same as well at grow practices, generate new business and build the position as it currently does not exist.
    Do you think this position would be considered an Out-patient Office Manager or Out-Patient Practice Administrator? I’d like to research position descriptions to build a JD. And any ideas on the salary range I should be asking for?
    Thanks,
    Karen

  11. Mary Pat Whaley February 2, 2012

    Hi Karen,

    If it is a hospital, titles usually go from a practice manager, who manages one or more sites, a practice administrator who oversees all outpatient sites, to either a Director or VP who manages all employed and community physician operations.

    Managing 20 physicians under the umbrella of a hospital that provides HR, payroll, payables, IT, purchasing, etc. may range between $50K and $70K. The same job in a standalone private practice where there is no hospital providing services would range between $70K and $90K.

    Best wishes,

    Mary Pat

  12. Mary Pat Whaley February 2, 2012

    Hi Yoany,

    Your current path sounds like a good one, however, I would add membership in a professional organization where you can work towards certification and can start networking, which will be invaluable. I suggest local and/or state chapters of MGMA (www.mgma.com) or PAHCOM (www.pahcom.com).

    Best wishes,

    Mary Pat

  13. TLD February 18, 2012

    Hello,
    Due to the retirement announcement of our office manager, I have been moved to her position. I have been working the check-in desk but due to my education and training have taken on projects such as website development, practice management software expert, MU, PQRS and EMR integration etc. I have been identified by the physicians as a valuable asset to the practice. I have an MBA and 6 years of healthcare exp in pt registration as well as as a Social Worker/Case Manager (stayed home for 15 years to raise my family). The practice is a specialty clinic in the mid west with 5 providers and 2 locations, 13 full-time employees. I am asking for information regarding salary range. How to determine my value and what to ask for or to know if an offer is inline. Thanks for your help.

  14. Mary Pat Whaley February 19, 2012

    Hi TLD,

    I do not have the most recent MGMA Management Compensation survey to quote benchmarks for managers in the Midwest in a specialty group with 5 providers and 2 locations. Some people think it is the most reliable source available.

    I agree with the physicians that you are valuable to this practice. You have the experience and the education, a rare and wonderful combination. The fact that you have not managed a practice before seems to be your only negative. Because it appears that you have a small staff, which I translate into a low-complexity practice without ancillaries, I suggest that the range for the position would be in the $50-$70 range with bonus possibilities.

    Best wishes,

    Mary Pat

  15. Lori March 27, 2012

    I am a member of MGMA. Do I just do a search for salary on their site to find the benchmarking information?

  16. Mary Pat Whaley March 28, 2012

    Hi Lori,

    As a member, you can buy the Management Compensation Survey ($195) to get all the benchmarking data – members who participated in the survey receive it free. If you don’t want to spend the money to get the data for all the job descriptions, as a member you can call the MGMA Survey Department (main number 877.275.6462) and request 3 data points a month. They describe 56 positions in the Survey, so you need to choose a position to get your data points on. The current survey is 2010 data reported in 2011.

    Best wishes,

    Mary Pat

  17. Alisha Jackson June 13, 2012

    I am going to Kaplan University and I am getting my Associates of Applied Science in Medical Office Management. I wanted to know when I finish and graduate how much I would or could make. Thanks A lot!
    Alisha Jackson

  18. john December 17, 2012

    I am one of 9 orthopedic/pmr md practice. We have 50 employees, 3 offices, MRI, xray, block suite. Collect approximately 10 million a year. In south carolina. Our CEO has double masters, 10+ years of experience with us. I think she is underpaid. A partner doesnt want to give her a raise unless she threatens to leave(not a way to do business). What would be a range base salary? We always bonus her about 3-4% of current salary. Thanks!

  19. Mary Pat Whaley December 19, 2012

    Hi John,

    Most CEOs of orthopedic practices are paid well because the surgeons are paid well. Sometimes when an administrator has been with a group for more than 5 years, s/he may be devalued within the practice for no good reason except familiarity. You can be sure that if you had to recruit a new manager, the price tag would be much more for someone who would have to learn you and your systems from scratch, and building trust takes time.

    It can be difficult for physicians to raise and bonus administrators when they see their income shrinking, but this is the time when a really good administrator works even harder to keep things status quo. It you waited to offer her more money until she gives notice, she might surprise you and turn you down. It never feels good to be taken for granted.

    Base salary varies, but I think someone with her credentials and experience would easily command a base salary of $130 – $150, in addition to an excellent benefit package and bonuses based on specific goals or projects.

    Best wishes,

    Mary Pat

  20. Nancy Zampino January 2, 2013

    I would greatly appreciate your input on what you feel the salary for an office manager should be. I have been employed by a two physician surgical practice in upstate NY (Albany) for 30 years. I have the responsibility of all phases of billing along with running the daily operation of the office. Payroll, accounts receivable and payable, etc. I have a 2 year degree.

    Your input would be greatly appreciated.

    BYW I have not taken a sick day off in 7 years.

  21. Mary Pat Whaley January 5, 2013

    Hi Nancy,

    It’s difficult to say what an office manager in this situation “should” make. The problem with being in one position for such a long time is that the physicians may be so used to (what I assume is) excellent office management, that they might take you for granted. if you left and they had to bring someone new in, it would not be unusual for them to have to pay more for a new manager, and of course that person would have to learn the practice from the ground up.

    Although physicians in general are very appreciative of what their managers and nurses do for them, they can also be blind to how good they have it until it’s gone.

    Your salary is affected by the cost of living in your area, the richness of your benefit package, the age of the physicians in the practice, and how much of a pay cut they have had to take over the past 5 – 10 years. That being said, if you are a top notch manager keeping everything operating smoothly and the money coming in well, I would think you should make $50 – $60K. Many managers are not getting raises these days, but are getting bonuses based on the successful completion of projects like installation of an EMR or successful attestation for Meaningful Use.

    Best wishes,

    Mary Pat

  22. J Leigh January 8, 2013

    I was offered a “Department Coordinator” position at a new private pain practice with 3 physicians and 3 mid-level practitioners. The office does in-office procedures and also coordinates surgery with local ASCs. There’s 6 medical assistances, an ultra-sound tech, 6 receptionists (included new patient coordinator and surgery coordinator) and a personal assistant to the ‘main’ physician. We see over 500 patients a week between all the providers. I was told my direct supervisor is the Practice Manager but I would handle the day to day management of the clinic and she would handle the business/financial aspects of the practice. It seems like it is the office manager function but worded as department coordinator. Is there a difference? Do many practices of this size have an office manager and practice manager?

  23. Mary Pat Whaley January 8, 2013

    Hi J.,

    Sometimes managerial duties are split between two people when one person does not have all the skills necessary to manage the finances and the day-to-day operations. I am not saying that this is the case here, but although you sound like a very busy 6-provider practice, I would expect the Practice Manager to handle everything, with one or two supervisors running departments (clinical and administrative is typical.)

    Best wishes,

    Mary Pat

  24. Cathy February 26, 2013

    Hi,

    I was offered a Practice Manager position with a cardiologist and general surgeon employed by a hospital. I have 8 years of experience as a Practice Lead/Medical Assistant. I have a B.S. in Health Services Management and am a Certified Professional Coder, I am also 3 classes away from my MBA. How much can I exepect to be offered for this position. I currently make 35,000/yr.

    Thank you!

  25. Mary Pat Whaley February 26, 2013

    Hi Cathy,

    Typically every hospital has a pay range for every position.You should be able to find out from the hospital what the range for a Practice Manager is, and then decide how you fit into that range. It sounds like you have the education, and are stepping into your first true management job, so you might place in the lower end of the range. Because every hospital has their own range developed (although it should be in line with the local market), it is hard to say what your hospital’s range might be.

    Congratulations and Best Wishes!

    Mary Pat

  26. Kim March 21, 2013

    Hi Mary Pat,

    In a couple months I will start as the site manager of a 4 doctor Orthopedic practice. At one of the three locations that we have. I have been with the practice 5 years and have been with the practice longer than anyone there (13 people) I previously was a medical assistant and took care of surgery and test scheduling, casting and bracing, taking histories, also scheduling workers compensations video taped trial depositions and much more. Thats besides the point I would like to know the range of pay for site managers.

    Thank YOu!

  27. Mary Pat Whaley March 22, 2013

    Hi Kim,

    Site manager salary will depend on what duties you do not have to perform because there is someone you report to that does. Site managers may not have final responsibility for Information Technology, Human Resources, or Profit & Loss. There could be a wide range of salaries based on duties, responsibility, cost of living and size of the community, so it could vary from $35K to $60K.

    Congratulations and Best Wishes!

    Mary Pat

  28. Sue April 6, 2013

    Hi Mary Pat! I am so happy to have found this website. I look forward to any input you might have on my situation.

    I have been employed with the same oral surgery practice for 37 years. It is a very successful, high volume practice. Initially, I was hired when there was one oral surgeon, then the practice expanded to two, and now the initial oral surgeon has retired (+5 years ago). The practice volume has remained the same – if not increased – with the remaining oral surgeon; he is very motivated and busy.

    My main function is billing and insurance. I, alone, post all of the insurance payments, submit secondary insurance claims (being an oral surgery practice, this might include up to 3 additional submissions when considering 2 parents and medial and dental plans) and send out billing statements and handle collection issues. Statement billing alone involves approximately 750 pieces monthly. The oral surgeon sees approximately 2900 new patients annually. Insurance payments posted exceed well over 1M annually. Also involved in these duties are the Managed Care adjustments and refunding of both insurance plans and patients, as we collect down payments up front. AR over the past year has been slashed by 22%. I admit, there are some accounts that slip through the cracks and are not handled as timely as I would prefer, but feel I am quite successful considering the volume.

    In addition, I am the go-to person for administering the 401K plan, employee insurance and working with the accountant and paying out payroll taxes and filing the Form 5500. I also assist and am the back-up individual for payroll and have duties working with vendors and computer issues.

    I am a very dedicated employee who gives 110+%. Can you perhaps provide me with a salary range for the Midwest? I look forward to your response.

  29. Mary Pat Whaley April 11, 2013

    Hi Sue,

    It sounds as if you do a lot of work and do a wonderful job! It’s very hard to put a price on your value, as that’s really what we are talking about here. It’s a one doc shop, very busy, and you are holding a lot of pieces together – so what is your value to the physician? There may not be people to actually compare yourself to.

    As I have stated before, sometimes people who have been in the same job for a long time are taken for granted. If you don’t feel that you are been paid enough, you may have to achieve your financial goals (the point where you feel valued) through bonuses or benefits as opposed to salary.

    Keep in mind that some of the things you are doing now could be done electronically. Payments can be auto-posted, patient refunds and statements can be eliminated through a credit card on file program, etc. The benchmark used to be .50 billing person per full-time physician, but with so much electronic support, it could be less than one half-time person.

    You may know what your doc makes, but oral surgeons usually make $200 – $250K per year, depending on what services they are providing. Take into account how you assist him in achieving his financial goals and consider if he could replace the functions you do for less money, because that is what many physicians are doing. Expanding your duties (as you already do to some degree) beyond the billing side may allow you to provide more value.

    I know I have not answered your question as you asked it, but I’ve tried to give you some things to think about.

    Welcome to Manage My Practice, and Best Wishes,

    Mary Pat

  30. Rea A. January 8, 2014

    Hello. I am currently working as a Practice Manager for a small specialy group. After completing a masters in health administration I had a difficult time finding a job due to my lack in experience. I’ve been working at my current company for a year now. I took a low compensation due to the fact that I had no experience and had difficulty finding work. What should my compensation range be based on my current experience and educational background? Thank you.

  31. Mary Pat Whaley January 26, 2014

    Hi Rea,

    That is a very difficult question to answer because so much depends on the state/region, the specialty, the size of the group, and what is going on in the practice as far as responsibilities and projects.

    First management jobs in healthcare salaries can start in the low 30s and be as high as the high 80s and it is completely dependent on the circumstances surrounding the job.

    Best wishes,

    Mary Pat

    Best wishes

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