The Business of Employed Plastic Surgery: Creating Your Seat at the Table

While the landscape of medicine changes, hospital employment continues to gain popularity in surgical specialties. The number of plastic surgeons entering an employed relationship has also grown, offering new opportunities and challenges alike. The authors studied the profitability of plastic surgery to the hospital and the necessity of the specialty to hospital administration through financial net revenue, contribution margin, and payer mix, to help plastic surgeons realize and capitalize on their importance and contribution to the hospital system.

Facility net revenue and contribution margin from Houston Methodist West Hospital were evaluated. Average net revenue and contribution margin for inpatient and outpatient cases for plastic surgery, orthopedic surgery, and all combined surgical specialties were studied for the 2018 and 2019 fiscal years.

The authors demonstrated net increase per year for both outpatient and inpatient revenue in favor of plastic surgery versus orthopedics and combined surgical specialties. Plastic surgery contributed higher facility net revenue when compared to orthopedics, contributing 20 percent more per outpatient case and 86 percent more per inpatient case. A higher contribution margin for each year was realized for inpatient cases versus orthopedics and combined surgical specialties, increasing by 8 percent and 53 percent and 61 percent and 86 percent, respectively.

A surgeon's ability to present objective financial data and develop leadership roles within the hospital system can lead to a favorable outcome for both physician and hospital. An objective dialogue with hospital administration is critical and offers an avenue to negotiate the development of your practice.