The Need for a Level Playing Field for Physician Pay

Everyone in medicine knows that some physicians are overpaid for the services they provide and some are underpaid. The list of specialties in each category is no secret, though we don’t talk about it much.  It’s part of the same ethic that teaches us not to criticize another doctor’s care.

But the sad fact is that in medicine, money is tied to prestige, power, public credibility, and medical student interest.  If we don’t deal with this problem, medicine will continue to fall hopelessly into the “haves” and the “have nots,” that is, those who “own” lucrativeCPTcodes and those who don’t. So the question is how did this inequity come to be and how can it be remedied?

History shows that physician pay rarely follows value, but rather aligns with power.  When I was a medical student, heart caths were new and were the domain of invasive radiologists. But it wasn’t long before the cardiology socialites took on the radiologists and successfully claimed heart imaging as their own.  Power and wealth followed.

About the same time, neurologists were trying to win control of brain imaging, but they lost the political battle to radiologists. Think how different neurology’s image and influence would be today if neurologists owned all those CT and MRI scans! Instead, they are stuck in work that is time-consuming, patient-centered, cognitively complex, and are forced to make a living on payments from EEGs and EMGs.

No one would suggest that general surgeons, rheumatologists, psychiatrists, or geriatricians make more money than they deserve, but it’s a fact that many of the most highly paid physicians do the least stressful and most repetitive work in medicine.  The radiologist sits in a dark room all day without the stress of patient interaction, looking at pictures that, in many cases, have already been read and interpreted by clinicians who needed the results yesterday. The anesthesiologist starts IVs, monitors drips, and measures vital signs.  There is an occasional emergency but most of the day-to-day work isn’t very demanding.  The gastroenterologist spends his day looking at the cleansed colons of patients who are asleep.  The opthamologist spends most of his time doing a single procedure over and over again.

Cardiologists are the most striking example. They have perfected the “I saved your life” routine, when the truth is that most stents are placed in patients who could have been treated equally well with $4 medicines from Walmart.  The greatest improvements in heart health are a result of statins, aspirin, and smoking advice – all the domain of primary care.  And then there are the dermatologists.  How stressful or cognitively demanding is it to freeze keratoses?

While it’s true that we need all of these specialties, it’s time for some of them to earn less.  The reason is that many other specialties deserve to be paid more. The average primary care physician, for example, makes one third of the income of the specialists above, yet research clearly shows that, of all medical specialties, primary care provides the greatest value.  The more primary care in a population, the better the healthcare outcomes and the lower the overall healthcare costs.  No other specialty can make this claim.

Everyone gives lip service to better payment for primary care, but the AMA and many specialists say that this should not be at the expense of other physicians. In a societyalready overburdened by the cost of medicine, physician payment is a zero-sum game.  Any increase in the income to underpaid specialists will come at the expense of those who are overpaid, and this should be publicly acknowledged by anyone who purports to support primary care.

The trick, then, is to figure out whose income should go up, whose should go down, and how to politically influence CPT and ICD coding – the language of physician payment – in a way that promotes better, more affordable medicine for America. The historical lesson from the past 20 years is this: the specialties that prosper are those that have positioned themselves to be defined by a few well-paid, narrowly defined, tightly held codes. The medical societies that fight for and defend their specialty’s codes will win.  At the other extreme are the specialties that rely on vague, poorly paid, and widely used codes (think E/M). They have no chance. The medical societies that believe this engagement is “fair” are like boy scouts in the middle of a mob turf war.

It is hard to be a physician who spends all day caring for patients who are worried, angry, afraid, depressed, hurting, or dying.  It is hard to spend all day cognitively sorting through limitless diagnoses based on the myriad complaints patients present to their doctor.  It is often hard to know whether a patient is best treated with a few words of reassurance or if high-tech medical care is needed. And it is really hard to do all of this knowing that, in the payment game, the field is not level and the rules are rigged.

Paul Fischer, MD is a family physician in Augusta, GA. With 5 colleagues, he recently filed suit in federal court against CMS, claiming that agency’s longstanding relationship with the AMA’s RUC, the advisory group whose recommendations have resulted in the current physician payment structure, has broken the law by not requiring the RUC to adhere to the Federal Advisory Committee Act’s management and reporting rules.

Categories: Uncategorized

41 replies »

  1. Steve, private insurers aren’t living in an alternate universe. Paying the same as other groups just means all groups are affected by reimbursement rate setting as all gas stations are affected by OPEC price setting.

  2. I need to pay my docs about what other groups are paying their docs. The RUC is just one factor since most of our revenue comes from private insurers.


  3. As far as I know, RUC does not set reimbursement, only determines relative work values. Reimbursement is driven by payers and the yearly Medicare conversion factor. The only ‘market forces’ are primarily driven by CMS, then followed by payers depending on the market dynamics (competition, access, sales, contracting,….)

    Let’s be clear that when discussing AMA/CPT/RVU/RUC we are discussing the methods used to set the relative work for patient encounters and procedures. Good luck trying to change the downstream ‘reimbursement’ as a stand-alone issue.

  4. I am ok with price transparency and open-market dynamics for setting costs, but how exactly would a patient determine what a provider should get paid?

    What other industry do you offer as a comparison where the end-user directly sets the reimbursement of the employee? Let’s see, professional sports-no, plumbers-no, politicians-no, financial executives-no. I can assure you that this would only widen the gap between specialists and PCPs, wait until the patient has acute appendicitis, then ask them if they are willing to give-up the pay for their family doc for a trip to the OR. (kidding of course to make my point)

  5. I came from the bottom 20% of the income group and the military did pay fro med school, but it is largely irrelevant. Market forces drive salaries. I have to pay new docs competitive salaries. It does not matter what their parents earned. What might be true, is that if students did not come out with so much debt, my new hires are carrying more than $300k, they would need lower salaries.


  6. “We passed Welfare and it trapped generations in government dependence and poverty.”

    Not really. It came down, just not very much.

    “We passed Medicare to solve senior poverty and it increased 13% to 19% and dragged down the entire nation.”

    Nope. Senior poverty has greatly decreased with the advent of SS and Medicare. It now transfers too much wealth.


  7. Renegotiating the physician payment gap by simply suggesting that some make ‘too much’ and some ‘too little’ is futile. I would tend to agree that the outdated and unnecessarily complex CPT-based system we currently utilize needs serious reform. The premise however is that there are many factors that play into the actual ‘work’ involved with caring for a patient (risk, pre-post care, call etc.). Perhaps these constituents need to be reconsidered. Dr. Fischer, how should we value that work involved with 90 total days of peri-operative care for a ruptured aortic aneurysm including multiple nights at the bedside, critical care, family conferences and malpractice risk? Other ‘global factors play into this also, for example, one could presume that providers taking overnight call ‘work’ more, simply by the additional hours they are providing or are available to provide care. Similarly the primary care doc who provides stressful complete and outstanding care but works 9-5 with an hour lunch and no call should be compensated in a manner to reflect this balance. The current system likely undervalues some aspects of primary care, and rather than suggest a zero-sum game as Margalit pointed-out, let’s focus on ‘appropriate’ compensation for the entire package rather than simply suggesting that all specialists by definition are overpaid.

  8. ” I can’t figure out what you;re trying to show with your link to general incomes”

    Maybe it wasn’t clear enough splashed across the top of the website and in the link.


    The general incomes you dismiss are the self reported household incomes of medical students while they were in high school. They then also started to add their parents professions. They also discussed how many income earners and people in the household.

    Lots of Nurses for moms.

    And you can’t figure out what I am trying to show?

    “I doubt medical costs are driven by rural institutions or the military. ”

    You really didn’t catch the, I thought, obvious link between free medical school and serving in the military and poor people being excluded from going into medical fields?

    Are you not the same Peter that wrote this;

    “If we subsidized education of more docs from lower income group then their expectation would be lower and they’d still have a good life style”

    And when I reply to that with a comment about subsidized education from the military or agreeing to serve rural areas you don’t make a connection?

  9. Nate, I can’t figure out what you;re trying to show with your link to general incomes, as well I doubt medical costs are driven by rural institutions or the military.

    “Monday, January 7, 2008
    Family Income in Medical School

    The American Association of Medical Colleges has published a study on “Diversity of U.S. Medical Students by Family Income” which shows that the majority of med students come from the top fifth of the population by family income. In addition, this number is actually growing, in spite of much official concern. The report concludes this way:

    A real concern is a possible increase in the systemic skewing toward children of upper-income families. From 2000, when 50.8 percent of matriculants came from the top quintile, to 2005, when 55.2 percent came from that quintile, there may be the beginning of an undesirable trend. As reported elsewhere,6 the debt incurred by medical students continues to increase with every passing year; 2007 graduates reported a median educational debt of $140,000. With debt increasing much more rapidly than
    physician incomes, a continued increase in the fifth quintile percentage would be a warning that medical education is becoming increasingly out of reach for applicants of modest means.

    This is not good. But medical schools are in fact doing better than very selective colleges, which is not good either.

    If you are interested in putting those numbers in perspective, this article about selective college admissions is a good place to start. The authors looked at the country’s “top” 146 schools, defined as those that are “most” or “highly” competitive in their admissions. There core finding was this:

    74 percent of the students at the top 146 highly selective colleges came from families in the top quarter of the SES scale (as measured by combining family income and the education and occupations of the parents), just 3 percent came from the bottom SES quartile, and roughly 10 percent came from the bottom half of the SES scale.

    This news shocked a lot of people when it was announced in 2003. It means that the great majority of the college-age population never goes near a highly selective college. It means that the country’s “good schools” don’t serve American society so much as they serve the top slice of it. It means that the people who could benefit the most from college – who don’t have a parent who went to college (or finished high school), or who have low family incomes – are the least likely to get the most intensive college instruction (small classes with senior faculty as happens most often in the wealthy privates).”

  10. ” you always end up with poverty as the underlying problem. Perhaps we should tackle the root cause instead of tinkering with its various effects.”


    We passed Welfare and it trapped generations in government dependence and poverty.

    We passed public housing and it trapped generations in a lord of the flies poverty perpetuator.

    We passed Medicare to solve senior poverty and it increased 13% to 19% and dragged down the entire nation.

    We start a program to feed a few million people and not 40+ million rely on it.

    I don’t think we can afford any more efforts of the government to solve poverty. Unless the goal is to make everyone equally poor 80 years of the war on poverty has been a complete failure.

    Unless your advocating drastic reduction in federal government to remove it from our daily lives you’re not addressing the root cause of poverty.

  11. This is interesting, but if you spend enough time discussing any health care issue – doctors’ pay, lifestyle choices, overutilization, entitlements, etc – you always end up with poverty as the underlying problem. Perhaps we should tackle the root cause instead of tinkering with its various effects.

  12. That’s indeed a very interesting chart. I trained in Germany (still have family and friends working there as docs) and now work in the US. My impression always has been that US physicians pay is a little better than everywhere for PCPs (but not by that much) and completely out of line for specialist pay. But this interesting chart demonstrates that, considering GDP adjustments and med school tuition, US physician compensation is not out of whack. Or better said, some other countries (seems to be mainly Austrailia, Netherlands, Belgium) pay docs rather well and have the same flaw of overpaying procedures compared to cognitive services. But that doesn’t make it right. I think that Dr. Fischer still is on the mark.

  13. what is the potential number of poor or middle class students that even quialify? If the large urban school districts only graduate 30-40% of their students then the vast majority would not be eligibile even if it was free.

  14. if you agree to server in a rural area you can get school for free yet many of those positions are still filled by foreign doctors for citizenship.

    The military will pay for all your education in exchange for a few years when your done.

    I don’t think there is any shortage of opportunities for any student to go to medical school for little to no cost. Compared to other nations we have a shortage of people even considering medical school.

  15. Here’s a comparison:


    One reason doc pay is so high here is that most of the docs come from high income households. It’s difficult to give up a life style you’ve become accustomed to. If we subsidized education of more docs from lower income group then their expectation would be lower and they’d still have a good life style – but maybe with one less vacation property.

  16. I can see how total physician revenues may be a negative-sum game these days, but why is physician payment per procedure a “zero-sum game”?
    How can one even define a zero-sum game without summing over volume?

  17. For anesthesia, the differential between private insurance payments and Medicare/Medicaid is very large. Medicare pays about 30% and Medicaid 15%-25% depending upon procedure. If your hospital has a large percentage on Medicare/Medicaid patients they are probably subsidizing.


  18. which might not be a good thing but doesn’t justify your comparable argument, there is no comparable industrial nation

  19. whats a comparable industrial nation? I can’t think of one with anything close to our racial make up or illegal immigrant problem. What your really saying is our orange cost twice as much as their apple.

  20. We pay in the aggregate ~2x per capita relative to comparable industrial nations. Where is all that money going? I assume that, to a significant degree, that is an empirical matter.

  21. I’d like to see some stats across countries… I think that would definitely level the playing field.

  22. Wow. I am underwhelmed at the professionalism here today. But my comment concerns anesthesia reimbursement. I remember needing to subsidize my anesthesia staff just to maintain an emergency coverage schedule as their reimbursements were so hideously dismal. Are they actually being adequately paid now?

  23. Oh, you’re a psychoanalyst to boot?


    Again, I am anything but “anti-physician,” a charge you routinely bandy about broadly here.

    I am just anti-whiner.

  24. PCPs are indeed obsolete. I just got a reminder from by Blue Cross Carrier that I am due for cholesterol and colon cancer screening. If the PCP was relevant, the Blues sould have had my PCP send me the notice. Much more inviting.

  25. why do you respond if my comment does not apply to you?

    I am glad you laugh, but lame to me to find comedy in your retorts viewed as being pathetic and annoying. I bet projection is a common defense for you. But, that is your goal in life, harass those who do not echo your interests and agendas.

    again, polly want a cracker?

  26. Well, I, for one, am not “anti-physician.” Quite the contrary.

    You and your blanket accusatory statements. You crack me up.

  27. I’m just curious, who out there who participates in this thread, who is employed mind you, goes to their employer/boss and asks for less pay or turns down a pay raise, for the good of the company or society.

    Get real you hypocrites. You ask doctors to work for less income and expect us to thank those who pocket the monies the system generates.

    Do you people who advocate we be paupers actually think about what you write before you type it!? It is nothing less than incredulous what some of you write. Again, why don’t you attempt to learn what is the sacrifice of becoming a doctor before you harass us to think and act like priests.

    Definitely antiphysicians here, no doubt!

  28. We have discussed the physician pay issue just a few weeks ago. I mostly agree with the Dr. Fisher. It has to be emphasized, though, that physicians are, like most other individuals, driven by self interest. For physicians, this self interest may be satisfaction derived from doing interesting work, helping people, teaching and research (if applicable), status and – money. It should not surprise anyone that in a country where some physicians are paid up to the 7 digits, quite a few are in medicine in large part for the money. I personally find this deplorable, and it can no longer be sustained. It may change only if there develops enough outside pressure on the overpaid physicians, because these physicians are well set up to defend the status quo through lobbying and propaganda. Right now, most pressure is geared towards insurance companies and “the system” (and those for sure are major culprits). Sorry, Americans, but you get what you buy, aim and vote for.

  29. First let me say that there is another poster above going by the name “Peter”. I have tried to get Matthew to fix this but got no response. The old format allowed me to email the poster to work out a name change – not this new format. I’m the original “Peter”, not that I’m stuck on the name, but I don’t want opinions cross attributed to me.

    Paul Fisher gives a great article but the vitriol of the responses from his “fellow” MDs shows that a way forward or that the “fairness” he advocates is an illusion. Docs aren’t in it for a better way or the system, they’re in it for themselves (as usual) and any change on reimbursement will be to higher pay not leveled pay.

  30. I love this thread, deeply.

    One of the first things you notice when you join the debate team is that any argument your opponent can equally use is counterproductive. (cf. “All those other jobs are easy”.)

  31. I believe a PCP can easily be replaced by NP’s thus freeing up money for all the new specialized genetic testing and personalized medicine that is being developed. Patient’s know which specialist they should see for their aliments. PCP’s are absolete. Sorry Paul.

  32. Overpaid by whom?

    Not the patient.

    But if the patient were writing the checks, the 1040’s of every doc would be different. Since the patient is not writing the checks, the insurance company with the too high premiums can pay for all the tests and treatments that the patient would never have valued enough to buy with their own money.

    And the CMS menagery patient who has been given his own key to the US Treasury vault just helps himself to billions of dollars in benefits that none of us voted to provide and none of us would give directly for such things as scooters, feeding tubes for vegetative patients and statin drugs for nursing home patients just back from thier cataract surgery.

    Every “covered” patient is a cash cow for the “overpaid” specialist. Without “coverage” there is no cash cow effect.

    PPACA gives everyone “coverage”. The trouble is there will be no one to “cover” the bill. The cost s of this bill are country-killing until controls come.

    If the patient were making the value decision about the stent, there would be few stents placed. If the patient ewere making the value decision, there would be few scooters sold.

    Once everyone has coverage the Gov’t will cut payments. Then they will control access. Then they will not care if you get sick. You will be cheaper dead than in the clinic. They will not care about QALY. There will be no care like there is now. There will be controls.

    The patient will not be able to buy what he values at any price anywhere. He will only get what the state wishes him (you) to get.

  33. Paul- I think that PCPs should be paid better also. However, you clearly do not understand what other docs do in their practices. I assume you reached your conclusions during medical school and internship. I will tell you what I thought I learned about primary care as a medical student and intern, based upon my observations. Let me be perfectly clear that I have learned a lot since then. This is not what I believe now.

    As a student, it seemed to me that PCPs mostly sat in their offices and talked with whiny patients who weren’t really all that sick. I never saw a PCP in the hospital after 11:00 PM, so I thought they sleep every night. I rarely saw a PCP in the hospital on a weekend, maybe only on a Saturday morning. If a pt got really sick, other doctors took over. PCPs called in orders to nurses and other people to do stuff.

    Now, if I approached a bunch of PCPs to discuss reimbursements, believing what I thought I saw as a med student, would that go well?

    I think your basic idea is worth considering. I also think everyone but me is overpaid. Well, actually, I think my specialty is a bit overpaid, some are way overpaid, some are about right and some underpaid. But, if you really want to have a meaningful discussion, I would suggest that you not start off denigrating what others do when your apparent level of ignorance is, to be frank, stunning.


  34. And thus if you belong to the AMA and yet are critical of PPACA, you as an MD should have a scarlet letter “H” on your white coat. For “H”ypocrite of extraordinary clueless proportions.

    They are so busy allegedly protecting their interests, they just aid and abet the efforts to create a civil war within the profession.

    The antiphysicians who scour these threads are laughing, and how pathetically ironic that physicians are the figurative idiots slipping on the banana peels.

  35. One of the first things you notice if you have to manage people is that everyone thinks all those other people have easy jobs.

  36. You left out other specialities. Why don’t you give us your opinion on every specialty, top to bottom, since you seem know what every other physician does all day long. You must be exhausted.