What is a high-cost physician specialty?

When one thinks of a high-cost physician specialty, more than one definition comes to mind. The term can refer to specialties with the highest procedure costs, greatest revenue potential, or those with the highest-earning physicians. The question here is: high cost for whom?

In the tables below, we’ve aggregated individual physician procedure analytics for the 2022 claim year to highlight high-cost specialties by both the percent of total charges and average charge per procedure. Percent of total charges refers to that specialty’s percentage of all total healthcare charges for the given year. Though this value does not reflect the actual payment awarded to a care facility or provider for services administered, it can be reflective of relative patient volumes and average procedure costs.

What are the 10 physician specialties by percent of total charges?

Fig. 1 Data is from Definitive Healthcare’s Claims Analytics product. Data is accurate as of December 2022.

Historically, orthopedics and plastic surgery have held top positions as high-cost physician specialties in terms of both physician earnings and average cost per procedure. While this fact still holds true, the table above paints a much different picture of the top-ranking specialties when organized by the percent of total charges.

Segmenting physician specialties by total charges shows a strong correlation between the percent of procedures and the number of providers, with family practice, internal medicine, and nurse practitioners being the top three most charged specialties in this category. 

While family practice, internal medicine, and nurse practitioners reported the greatest percentage of procedures in 2022, they also reported some of the lowest average costs per procedure. All three specialties reported an average cost per procedure of $341 or lower, with family practice claiming an average cost of just $165 per procedure—one of the lowest of all physician specialties measured.

Top 10 physician specialties by average charge per procedure

Fig. 1 Data is from Definitive Healthcare’s Claims Analytics product. Data is accurate as of December 2022.

Based on anticipated physician earnings, organizing by greatest average charge per procedure produces a list of high-cost physician specialties that is more closely aligned with expected outcomes. At an average cost of about $1,900 per procedure, the highest high cost paying physician specialty is nephrology. This is followed by radiation oncology and neurosurgery.

Interestingly, the top ten high-cost specialties by average cost per procedure listed above have significantly less providers than those high-cost physician specialties by percent of total charges—highlighting the impact of these differentiating data points in high-cost classification.

While the term “high-cost physician specialty” cannot be boiled down to a single definition, it is still a strong indicator of how much financial investment there is in that specialty and how that specialty compares to others economically.

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