Momentum behind incentive-based compensation for advanced practice providers (APPs) seems to be slowing.
A March 25, 2025, MGMA Stat poll found that less than half (44%) of medical group leaders reported using salary plus incentives for APP compensation — the same percentage who rely solely on salary or hourly wages. Another 6% noted they use an RVU-based compensation model, 3% said they have a volume-based model, and 3% reported “other.” The poll had 488 applicable responses.
This marks a slight retreat from incentive-laden APP compensation from an August 2023 MGMA poll in which salary with incentives stood at 51%. Comparing the 2023 and 2025 results:
- Volume-based compensation remained low and stable, with 2% in 2023 and 3% in 2025.
- RVU-based compensation showed no change, at 6% in both polls.
Many practice leaders using salary- or hourly-only models said they are considering adding incentives, particularly tied to productivity/RVUs or value-based care metrics. They expressed general interest in offering incentives but shared uncertainty around how to implement them effectively.
However, several of those respondents indicated no plans to change their current APP compensation methodologies. This may reflect a preference for more straightforward salary models that offer cost predictability amid the pressure of rising operational expenses.
Despite these trends, hiring remains strong: In a June 2024 poll, 63% of practices reported plans to add new APP roles. Fixed-salary models might appeal to some organizations for their ability to streamline recruitment. They also reduce the administrative burden of tracking incentive-based pay — an important consideration for smaller organizations with limited resources.
Do you have any best practices or success stories to share on this topic? Please let us know by emailing us at connection@mgma.com.
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MGMA resources
- Access MGMA's member-benefit tool, APP Compensation Model Contract Outline.
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