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Physician Salaries on the Decline

Related Posts: Doctor Salaries, A Problem Overseas Too

Sources: American Medical Association, American Medical Student Association, Center for Studying Health System Change, New York Times

Last year (2006) a story published in the New York Times reported something troubling. Physician salaries are on the decline.

the average physician’s net income declined 7 percent from 1995 to 2003, after adjusting for inflation, while incomes of lawyers and other professionals rose by 7 percent during the period.

Some people do not think that this decline is a problem at all. Even with the decline, physicians are still making a decent salary. They aren’t going hungry. Maybe they have to forego a brand new S-class, but doctors don’t live off of welfare. And with the ever-increasing costs of healthcare, physician salaries just don’t seem as important.

It is very important. This country is headed towards a severe physician shortage. New medical schools are opening up and existing schools are expanding their freshman class sizes in response. Producing more physicians each year is not enough. Physician salaries must increase as well.

The shortage we are expected to go through is in the primary care segment. As it is, the current state of healthcare encourages doctors to enter high-paying specialties. New graduates are not flocking to Pediatrics, Internal Medicine, and Family Practice. Take a survey of any freshman medical class in the country. Many will share their desire to go into radiology, surgery, orthopedics, plastics, or dermatology.

Why? Frankly, for most, it’s because that is where the money is. Those specialties are the quickest way to get out of the enormous debt incurred during medical training. According to the American Medical Student Association (AMSA), the median debt for students at a public medical school is over $119,000 while those that go to a private medical school will carry a median debt of nearly $150,000. On top of debt, physicians make approximately $48,000 during their years during residency — which lasts at least 3 years. It could take up to 8 years for a thoracic surgeon to complete his/her training.

The stereotype of a lawyer is someone whose focus is on the number of billable hours. On the other hand, the stereotype of a doctor is one of compassion for a patient. While stereotypes can be dangerous, it is possible that in some ways they may give us a glimmer of reality.

The kind of people that go into medicine are usually people who truly care about the health of their patients. It is not a career chosen solely based on financial reasons. Today’s medical students are aware of the huge costs of training and the low reimbursements from insurance, medicare, and medicaid.

But there are many people who would make excellent doctors. They have all the right qualities but choose to go into other fields. They are discouraged from pursuing a medical career by working doctors tired of rising costs of malpractice insurance, declining salaries, bureaucratic hassles, and long workweeks. A career in medicine just does not seem “worth” the time and effort (see AMA Response to declining physician salaries).

Declining physician salaries are a big problem. It’s a big problem for the medical community and a big problem for the patient. If they continue to fall more and more prospective medical students will decide not to go into medicine because it is not “worth” it. Medical school graduates will continue to avoid primary care for higher paying specialties. And doctors will continue to order diagnostic procedures that bring in more revenue.

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  • *filtered*

    Phsician Salaries on the decline ! This is certainly not a good news. Come on Government, do something.

  • *filtered*

    Phsician Salaries on the decline ! This is certainly not a good news. Come on Government, do something.

  • http://MDsalaries.blogspot.com/ Digitaldoc, MD

    The decline might occur further when a single payor model of some sort comes to the US, yet physicians would like a single payor as it means less hassles over billing, coding and avoid the the insurance / administration maze!

  • http://MDsalaries.blogspot.com Digitaldoc, MD

    The decline might occur further when a single payor model of some sort comes to the US, yet physicians would like a single payor as it means less hassles over billing, coding and avoid the the insurance / administration maze!

  • http://www.JeffreyMD.com/ Jeff W

    Which is why I believe that should we (as a country) go to a single-payer, government funded system, the salaries must increase or else a medical career will not be “worth it” to many of this country’s best and brightest.

  • http://www.JeffreyMD.com Jeff W

    Which is why I believe that should we (as a country) go to a single-payer, government funded system, the salaries must increase or else a medical career will not be “worth it” to many of this country’s best and brightest.

  • Anonymous

    “yet physicians would like a single payor”

    Was that a joke?

  • Anonymous

    “yet physicians would like a single payor”

    Was that a joke?

  • Tom Adams

    Medical Doctors in the U.S. make 3 to 4 times more than their counterparts in other developed countries, yet many of these countries have much better health outcomes as measured by life expectancy, control of cronic disease and infant mortality. This certainly begs the question, are extremely high physician salaries essential for good national health.

  • Tom Adams

    Medical Doctors in the U.S. make 3 to 4 times more than their counterparts in other developed countries, yet many of these countries have much better health outcomes as measured by life expectancy, control of cronic disease and infant mortality. This certainly begs the question, are extremely high physician salaries essential for good national health.

  • David

    US medical grads make more since we must pay not only for 4 years of college, but also 4 years of medical school. Many countries don’t even require 4 years of undergraduate, and medical school is free. Perhaps our control of CHRONIC disease could be attributed to the inability of our citizens to adequately take care of themselves (eating right, not smoking, taking their medications). Remember, doctors cannot take the fork out of your hand. Americans need to take some responsibility for their own health.

  • David

    US medical grads make more since we must pay not only for 4 years of college, but also 4 years of medical school. Many countries don’t even require 4 years of undergraduate, and medical school is free. Perhaps our control of CHRONIC disease could be attributed to the inability of our citizens to adequately take care of themselves (eating right, not smoking, taking their medications). Remember, doctors cannot take the fork out of your hand. Americans need to take some responsibility for their own health.

  • John

    Accountant salaries are dropping, GOVERNMENT DO SOMETHING!!!. Why should the government do something for doctors when they’re income is falling. There are many fields that don’t pay as much that highly qualified people still go into. Just look at the poeple at the SEC or the FED RESERVE. Those people had been making 10x in private jobs but they still chose to move and do the lower paying job in the government. Other jobs as well don’t pay as much. Smart people still invest time to get PH.D’s in those fields and do the job. They ran up debt to finish their educations too. They don’t run crying to the government everytime they don’t think they make enough money! Quit your F***IN whining all you doctors and get real! If you don’t like it get the F**K out of medicine! There are plenty of FMG’s that can take your place for a fraction of what you charge! If that doesn’t work there is a rising tide of medical tourism and fields like radiology are already getting outsourced.

  • John

    Accountant salaries are dropping, GOVERNMENT DO SOMETHING!!!. Why should the government do something for doctors when they’re income is falling. There are many fields that don’t pay as much that highly qualified people still go into. Just look at the poeple at the SEC or the FED RESERVE. Those people had been making 10x in private jobs but they still chose to move and do the lower paying job in the government. Other jobs as well don’t pay as much. Smart people still invest time to get PH.D’s in those fields and do the job. They ran up debt to finish their educations too. They don’t run crying to the government everytime they don’t think they make enough money! Quit your F***IN whining all you doctors and get real! If you don’t like it get the F**K out of medicine! There are plenty of FMG’s that can take your place for a fraction of what you charge! If that doesn’t work there is a rising tide of medical tourism and fields like radiology are already getting outsourced.

  • China Dr

    I agree with John. I have seen alot of changes through the 30 years of practicing medicine. Many foreign medical graduates work in the US for a little time just to gain experience, then go back to their home countries to set up shop there! On top of that, I’ve seen students go to medical school and finish residencies in the US only to go back to their motherland. That’s one expense the US will never capitalize on.

  • China Dr

    I agree with John. I have seen alot of changes through the 30 years of practicing medicine. Many foreign medical graduates work in the US for a little time just to gain experience, then go back to their home countries to set up shop there! On top of that, I’ve seen students go to medical school and finish residencies in the US only to go back to their motherland. That’s one expense the US will never capitalize on.

  • h

    You sound educated John, what with your inability to distinguish between “they’re” and “their”. When you take into account the massive debt that med students take on, the incredibly high malpractice insurance and the other costs, they really aren’t making that much.

  • h

    You sound educated John, what with your inability to distinguish between “they’re” and “their”. When you take into account the massive debt that med students take on, the incredibly high malpractice insurance and the other costs, they really aren’t making that much.

  • IR Doc

    John misses the point. As a group I don’t believe physicians are asking government to “do something.” On the contrary, we are hoping the government doesn’t implement laws and regulations that determine what we (I) should get paid. Many individuals without health insurance can afford it, but they choose alternatives such as flat screen televisions, better neighborhoods, 2 bedroom apartments rather than 1, nike shoes instead of non designer labels,and so on. Why is free health care the right of all individuals such as this? I do a job that took me 4 years of college, 4 years of medical school, 5 years of residency and 1 year of fellowship — that,s 14 years of schooling after high school. Then I did 3 years as a junior partner in a radiology practice. Now I’m a partner and guess what, I drive a Honda Accord and still make wise financial decisions. Now, the government comes along and sets the value of my profession with the “relative value unit” so that a particular procedure has a particular value. Then, they decide to pay me only 80% of that value … and to cut the payment 5% each year over the next 10 years! Yes, I can survive on a much lower salary — so can you and everyone else. But where else does government determine what a nongovernmental worker should be payed? Oh yeah, in the bank takeover. It’s not so important the salary, but the fact that Uncle Sam feels that they have the right to control it. I for one and many others will not tolerate such a socialistic control over my livelihood. Take note of the courses being offered around the nation that help give physicians the ideas and resources to leave medicine and still live a productive (though less profitable) life. At least we again can work in a job where the ones who work hard and sacrifice can earn a salary commensurate with there effort (Did I mention 14 years of education and being on call every other week, being woken up all night long to leave my wife and kids to go to the hospital?) I won’t even discuss the horrendous hours I worked during my 14 years of training or the 10 years of governmental service I provided as an Air Force physician.

    John, your comments are very shallow.

  • IR Doc

    John misses the point. As a group I don’t believe physicians are asking government to “do something.” On the contrary, we are hoping the government doesn’t implement laws and regulations that determine what we (I) should get paid. Many individuals without health insurance can afford it, but they choose alternatives such as flat screen televisions, better neighborhoods, 2 bedroom apartments rather than 1, nike shoes instead of non designer labels,and so on. Why is free health care the right of all individuals such as this? I do a job that took me 4 years of college, 4 years of medical school, 5 years of residency and 1 year of fellowship — that,s 14 years of schooling after high school. Then I did 3 years as a junior partner in a radiology practice. Now I’m a partner and guess what, I drive a Honda Accord and still make wise financial decisions. Now, the government comes along and sets the value of my profession with the “relative value unit” so that a particular procedure has a particular value. Then, they decide to pay me only 80% of that value … and to cut the payment 5% each year over the next 10 years! Yes, I can survive on a much lower salary — so can you and everyone else. But where else does government determine what a nongovernmental worker should be payed? Oh yeah, in the bank takeover. It’s not so important the salary, but the fact that Uncle Sam feels that they have the right to control it. I for one and many others will not tolerate such a socialistic control over my livelihood. Take note of the courses being offered around the nation that help give physicians the ideas and resources to leave medicine and still live a productive (though less profitable) life. At least we again can work in a job where the ones who work hard and sacrifice can earn a salary commensurate with there effort (Did I mention 14 years of education and being on call every other week, being woken up all night long to leave my wife and kids to go to the hospital?) I won’t even discuss the horrendous hours I worked during my 14 years of training or the 10 years of governmental service I provided as an Air Force physician.

    John, your comments are very shallow.

  • Not a Doctor

    I was seriously considering pursuing a career as a doctor until I started having conversations with extended family members in the profession. The amount of bitter you have to eat is amazing. The factors that were important to me in deciding not to become a physician were the following: extremely long work hours (50-70/week) and being on call, the brutality of residency (100+ hour work weeks, low pay, and the system used to assign residencies), the debt (it almost necessitates going for a high paying specialty), and the rising fraction of time spent dealing with bureaucracies (as opposed to time spent on patient care). I was most interested in family practice or endocrinology and was told flat out that I might have difficulties making ends meet. They all said they loved working in medicine, but that becoming a physician’s assistant or looking into medical physics (physics was my undergraduate major) might both be better options. The last nail in the coffin was the impending socialization of medicine. The idea of universal coverage is laudable and likely inevitable. However, there is a significant risk that physicians will be subjected to pay cuts and greater bureaucratic intervention. For now, I’m putting the idea of becoming a doctor on hold and looking at other options.

  • Not a Doctor

    I was seriously considering pursuing a career as a doctor until I started having conversations with extended family members in the profession. The amount of bitter you have to eat is amazing. The factors that were important to me in deciding not to become a physician were the following: extremely long work hours (50-70/week) and being on call, the brutality of residency (100+ hour work weeks, low pay, and the system used to assign residencies), the debt (it almost necessitates going for a high paying specialty), and the rising fraction of time spent dealing with bureaucracies (as opposed to time spent on patient care). I was most interested in family practice or endocrinology and was told flat out that I might have difficulties making ends meet. They all said they loved working in medicine, but that becoming a physician’s assistant or looking into medical physics (physics was my undergraduate major) might both be better options. The last nail in the coffin was the impending socialization of medicine. The idea of universal coverage is laudable and likely inevitable. However, there is a significant risk that physicians will be subjected to pay cuts and greater bureaucratic intervention. For now, I’m putting the idea of becoming a doctor on hold and looking at other options.

  • John

    Medical doctors in the United States enjoy appallingly inflated salaries. I attribute this problem primarily to the AMA, an institution which effectively enforces a chronic supply shortage in addition to unnecessary demand. The educational system is strangled by the withholding nature of the AMA, which prevents universities from properly responding to the enormous demand for training slots. This environment prevents equilibrium from occurring. Prescribing has been monopolized in spite of the fact that nurses and pharmacists are unquestionably competent enough to grant drugs in certain instances. Well-trained foreign doctors are subjected to unnecessarily lengthy re-training programmes. I could easily continue. Minimizing entrance barriers and burdensome regulations would resolve most of the problems we’re witnessing in the medical system.

  • John

    Medical doctors in the United States enjoy appallingly inflated salaries. I attribute this problem primarily to the AMA, an institution which effectively enforces a chronic supply shortage in addition to unnecessary demand. The educational system is strangled by the withholding nature of the AMA, which prevents universities from properly responding to the enormous demand for training slots. This environment prevents equilibrium from occurring. Prescribing has been monopolized in spite of the fact that nurses and pharmacists are unquestionably competent enough to grant drugs in certain instances. Well-trained foreign doctors are subjected to unnecessarily lengthy re-training programmes. I could easily continue. Minimizing entrance barriers and burdensome regulations would resolve most of the problems we’re witnessing in the medical system.

  • miamihippo

    john,
    more residency slots are supported by the ama. Our government is the one not giving the additional funds to residency programs! Why is that? maybee bc we r too busy giving funds away to other countries.
    your comment on 'US docs and inflated salaries'….hello, r u nuts have you even looked at the finances invested to become a doc… and the 10 years where you are basically bringing home minimum wage or working for free in a research position…
    your next comment “nurses and pharm are competent to prescribe”— do you want your mother to be prescribed meds for her uncontrolled diabetes by a 2 year RN who didnt even have to do a 3-5 year residency after her 'class room education'
    what will solve the problem is if government pays for more residency positions…. more slots to FMG's and US grads….. may the best candidates earn the positions…there should not be different requirements for fmg verse the amg's. why should amg be allowed to score 70 and fmg must score 99… this is whats insane…. this is why health care will suffer in quality of care…. its not based upon how much you know, but who you know… and noone is regulating this….. signed, miss florida

  • Seriously?

    John,
    Please get off the internet.

  • http://www.jobsindubai.com/ Emirates Jobs

    well they must be given proper attention, because they are the one who are helping the person if he has an injury after and accident. even though they are still earning fairly.

  • John Crick

    Physician salaries are certainty not the deciding factor for patients well-being and yet, you seem to propose that it may be the only one. The American lifestyle and diet, among numerous other factors, are both extremely toxic and detrimental to national health. Also, to reinforce the important point the article made, higher salaries create more competition for those looking to get into a career, which baits more of your brightest college students to the medical graduate programs of the nation. As a college student currently finishing up my premed, I’m rather offended at how shallow you think doctors have come to be concerning their income. Medicine is not a career that is solely based around money for those who assimilate into it. I’m rather confident of the intellectual abilities of students who are capable of getting into med-school programs, and finishing them. These students are the students with the most skillful resources and drive that hold the greatest potential to earn a disgusting income in this gross capitalistic society we live in. But what is truely more honest than the care of a doctor at that income level? Expanding on that, it may take 12 years to finish the production of a doctor who may walk out 150k in debt to his school, however it may take less than a year to complete a successful Chinese mass-production run of “The Snuggie.” Which ethics do you want your country to foster? What do you want your country to invest in? What value do you place on higher education? How can you be serious?

  • Shawnweb0118

    Hmm.. I thought the main motivation for a new med student is humanity and caring for the patient? Who isn’t taking a pay cut? Yes, medical malpratice insurance is high and low insurance reimbursements. Doctors still, profit over 100+ thousand/ year. That’s not good money? Please, crying is useless. Most of the time, your talking to the doctor for 1 or 2 mins. He or she writes the prescription and says goodbye.

  • http://www.jeffreymd.com Jeff W

    Thanks for your comment. I assume it is in response to my post than to any one commenter in particular.

    You are correct in that a new med student should be motivated by humanity and caring for a patient. However, practicality must also be considered. Again, I’ll reiterate what I wrote in the post above. The declining salaries will drive individuals who would make brilliant physicians into more lucrative fields like business, law, etc. I felt this was clear in what I wrote.

    Also, you help to illustrate one very important point — that the public’s perception of a physician’s salary is very wrong. Sure, there are some physicians that are millionaires. But this is not the case with your average doctor. And this notion of the wealthy physician may be a holdover from times passed. I won’t bother writing out a detailed analysis of the cost of education and the income a doctor makes out of medical school. This has been done ad nauseam by others more eloquent than I. Instead, I will provide a couple links for your perusal.

    The first link is a post by Dr. Benjamin Brown who writes a detailed analysis (with sources) discussing the hourly wage of an average doctor and average school teacher over the course of a career: http://benbrownmd.wordpress.com/2010/06/20/informedconsent/

    The second link is a YouTube video (approximately 1 minute in length) regarding finances of an average physician: http://www.youtube.com/watch?v=d4MA47I5U38

  • remove Best Malware Protection

    Physicians don’t need to worry about salaries.

  • Ibenez100

    Those other countries publically fund medical education. Furthermore, the US is far more litigious so malpractice rates are higher. Overhead is higher and physicians must pay more benefits for their staff. Also, medical education is longer in America than other countries. We have limited the workweek of residencies to 80hr/wk while other countries have limited it to 45hr/wk. stop comparing salaries alone and take a gestalt approach.

  • Ibenez100

    Wrong. Medical education is extremely expensive for not only students but the medical college and therefore the State. We cannot simply add more med schools or increase seats arbitrarily.

  • Ibenez100

    Stop putting physicians on a pedestal. This is why malpractice is so high in this country; people think doctors are God’s gift to humanity. Doctors are very caring people but we also follow the basic laws of human emotions and fulfillment where we need to feel like our work is appreciated.