https://mailchi.mp/d29febe6ab3c/the-weekly-gist-august-25-2023?e=d1e747d2d8

At a meeting last week, a surgeon (and loyal Weekly Gist reader) shared his thoughts on our recent coverage of research evaluating physician earnings, and analysis comparing the incomes of American doctors with those in other Western countries.

(The gist: unsurprisingly, American doctors make more money—and one of the primary reasons is that there are simply fewer physicians per capita here than in most other Western nations.)

His retort: “It sounds like you’re rooting for doctors to get paid less!” Given the number of emails we received on the piece, it’s clear that the topic touched a nerve. 
 
A few doctors pointed out the limitations of simple supply and demand in driving physician salaries. Of course there are important structural differences between our delivery and payment system and those in other nations: fee-for-service versus global payment; length of training and degree of student debt; and relative salaries of specialists versus primary care physicians, just to name a few.

But if anything, the effects of supply and demand are amplified in a more market-driven system like the US. Plus, there are factors, like regulation of the number of residency training slots, that keep supply artificially low—and physician incomes in competitive specialties high.

At a high level, the data do show that prices—both physician and hospital—are higher in the US than other countries, whereas utilization is roughly similar. 

Over time, we’d expect that there will be continued price pressure driving down doctors’ incomes, but large swings in physician salaries will take a generation or more to emerge. 

And should physicians experience more salary pressure, expect more of them to seek additional sources of entrepreneurial and investment income—further increasing the spread between the lowest- and highest-paid doctors.