Physicians are working harder for more pay with compensation driven by patient demand and a shortage of doctors while reimbursement rates are stagnant and expected to worsen, a new report shows.
The American Medical Group Association’s AMGA 2026 Medical Group Compensation and Productivity Survey shows total clinic compensation is up 4.3% this year. Total clinic compensation includes pay of primary care physicians, medical specialties, surgeons and advanced practice nurses and physician assistants.
“Overall total clinical compensation rose 4.3% in 2025, a sustained increase that reflects both growing patient demand and the intensifying competition for clinical talent,” AMGA said in its analysis. Data for the AMGA 2026 Medical Group Compensation and Productivity Survey comes from more than 450 medical groups and health systems and more than 190 medical specialties representing nearly 190,000 providers of medical care.
For example, primary care doctor pay rose 3.7% on average with median compensation of family physicians up 3.7% to $342,411 compared to $330,216 in 2025. Meanwhile, compensation of internal medicine doctors was up 3.9% to $361,426 and pay of pediatricians was up 3.5% to $305,435.
But AMGA analysts say about half of compensation growth is being funded by “increased provider output, not by gains in reimbursement.” Work relative value units (wRVUs) increased 2.4% overall in 2025, and patient visit volume grew 2.0%, which AMGA analysts say are “signs of genuine demand expansion.”
Meanwhile, there’s still a physician shortage. The Association of American Medical Colleges says the United States will face a physician shortage of up to 86,000 physicians by 2036.
“Over the past several years, provider compensation has increased, but approximately half of the increases have been supported by ongoing growth in wRVU production,” said Fred Horton, AMGA Consulting president. “In a marketplace with stagnant reimbursement, this is necessary to afford the increases in total cash compensation, but it is not sustainable. At some point productivity will top out, and providers are already adjusting their (full-time equivalent employees) and seeking alternative work arrangements in response to increased workloads.”
The report comes amid a “difficult policy backdrop,” AMGA analysts said with a coming wave of federal spending cuts to the Medicaid health insurance program for poor Americans and the loss of enhanced subsidies for Americans to buy individual coverage under the Affordable Care Act also known as Obamacare.
The One Big Beautiful Bill Act that President Trump signed into law last year is projected to reduce federal spending on Medicaid by about $1 trillion over a decade.
“The Medicaid piece going to be very problematic going forward,” Horton said.