Wealthy Physician Fallacy: What's the Value of Your Physician in 2015?

What appeared to be an inexorable and disproportionate rise in health care expenditures adjusted for inflation has waned over the past few years. Partisan advocates have attributed this to initiation of the Affordable Care Act. However, unbiased consensus asserts that the financial consequences of Obamacare will take years longer to be evident. More likely, several other factors have contributed:

  • The recent recession and progress in tort reform
  • Generic drug usage
  • Institution of best practices protocols
  • Integration of physician extenders
  • Computerized medical records
  • Reimbursement incentive modifications

Still, from 1958-2012, the time an average workers would have to be active to cover health expenditures has quadrupled while the time-cost of many durables and services has plummeted, often by 90 percent (especially electronics, cited in FORBES 12/22/12).

No matter the recent trend, cutbacks in payments for provider services is a relentless and persistent tool universally acclaimed as cornerstone to healthcare cost containment. Concurrent with the bludgeoning of physician income is the populist conviction that this is morally justified to combat physician greed and unwarranted overcompensation. Take away the rich medical specialists’ ill-gotten lucre and all will be well. To paraphrase Hillary Clinton during her attempt at healthcare reform, the last thing this country needs is another heart surgeon, at least until her husband needed surgical revascularization.

What makes this politically motivated assault more ludicrous is how fallacious this perception is. Consider first the enormous commitment in time and effort required to gain the educational credentials necessary for medical practice. Undergraduate degrees precede four years of medical school to gain acceptance to a 3-7 year residency in a particular field of practice.

The cost of both public and private graduate and postgraduate study has also skyrocketed. US News and World Report in July 2014 reported the average student loan indebtedness as $170,000 for those individuals who borrowed during medical school. Moreover, this figure does not include the interest accrued while repaying the principal due.

The newly minted physician, after a decade and a half of schooling and incurring significant debt, has one more prerequisite hurdle. Malpractice insurance is the ante for providing medical care. The 2010 “Medical Liability Monitor” showed annual premiums of $48,000 for internists in Dade County, FL and $190,000 for general surgeons. OB-GYN premiums were $205,000 in counties abutting New York City.

These are the costs that must be met by the current and future income. Again, geographical location and specialty significantly influence reimbursement. On a personal level as a cardiac surgeon, Blue Cross/Blue Shield paid $3,300 for a 3-vessel bypass in 1980 when I finished the residency and $2,300 for the same procedure when I retired from active clinical practice in 2009. These are nominal amounts, not adjusted for inflation. No provider reimbursement has been sacrosanct, all have gone down.

So how much do physicians actually get paid?  Online Data Profiles Database published in 2013 representative income for starting physicians and for those who had been in practice 6 years. At the lower end were family practitioners and general internists starting at $138,000 and $145,000 respectively.  Internists’ salaries rose to $213,000, but remaining flat for family doctors after six years. On the higher end, cardiologists and neurosurgeons started at $270,000 and $398,000, respectively, and rose to $405,000 and $550,000 after six years.

Is this unreasonable compensation given the requisite time, effort, competitive scrutiny and cost of preparation and insurance?  Not to mention the continuous responsibility and pressure inherent to the profession.  If an individual had only monetary interest as the goal then he or she would be better served by focusing all these mental and temporal resources in innumerable other trades, crafts, services or professions, and would start earning at a much younger age. It is time to stop demonizing a noble profession and start debunking the fallacy of the unscrupulous, wealthy medical practitioner.


By Norman Silverman, MD, with Ryan McKennon, DO and Ren Carlton

Mental Health Spending: A Story of Failed Supply and Demand

Several weeks ago I was in Palo Alto, California walking along Camino Real abutting the Stanford University campus. I noticed a newly-constructed high-link fence isolating the commuter train tracks from the pedestrian walkways. Another “shovel-ready” infrastructure project to nurture the economy?

Photos - MPS Auto Show Event - Lingenfelter Collection!

Our auto show event at the Lingenfelter Collection was a huge success! Approximately 100 attendees enjoyed an evening of learning, networking, and fun at the Lingenfelter Collection, one of the most notable car collections in the world! A special thanks to M1 Concourse and the Lingenfelter Collection for sponsoring this event.

Michigan Physicians Society Auto Show Event - Lingenfelter Collection!

We are excited to announce our next MPS event! MPS members will enjoy an exciting evening of learning, networking, and fun at the Lingenfelter Collection, one of the most notable car collections in the world! Learn about car collecting as an alternative investment strategy while enjoying a private tour of the Lingenfelter Collection.

Physicians Role in Drug Pricing

Two new drugs, Repatha and Praluent, were approved by the Food and Drug Administration several months ago amid much ballyhoo. Both are antibodies that specifically target PCSK9, a protein which reduces the number of receptors on the liver that remove LDL cholesterol from the blood. By blocking PCSK9’s ability to work, more receptors are available to clear LDL. This novel mechanism was proven safe and effective in clinical trials, lowering LDL cholesterol levels by 40% or more in patients already taking statin drugs. However, powerful treatment comes with a powerful cost-- over $14,000 per year for each patient.

Physician or Salesperson? - The Ethics Behind Patient Donors

Maybe it’s because we have entered the silly season with a full cast of presidential aspirants, but I have recently mulling over the perception of behavioral impropriety. To translate from spin doctor to medical doctor, I mean professional behavior that may not be overtly unethical, but exudes self-interest over patient well-being. In the academic world, full disclosure includes financial interest with potential conflict, disclaimer of previous publications, responsibility for informed consent and approval by the appropriate research committee. In our practices, particularly in the clinic or hospital setting, much focus is on constructing a firewall between the pharmaceutical and the medical-device sales force and medical providers.

Cutting Healthcare Spending - Big Data, Hospital Costs, and Outcomes

According to the federal Agency for Healthcare Research and Quality (AHRQ), inpatient hospital costs account for nearly 30% of healthcare spending in the United States and are increasing by about 2% per year over inflation. This cost issue is a focus of the Affordable Care Act, which is accelerating the move away from fee-for-service to a single, diagnosis-related comprehensive payment, similar to Medicare reimbursement. Such payment systems punish unnecessary testing, prolonged hospitalization, and readmissions.

Is Medical Science Dead? - Art, Science, and Quackery

On April 8, 1966, Time Magazine caused a national commotion when the issue’s cover was emblazoned with the question, “Is God Dead?” The Time article was a measured consideration of how society was adapting to the diminishing role of religion in an age of stunning scientific advances. The writer posited that people would no longer believe things out of received doctrine, but faith would steadily succumb to the scientific method as mankind unraveled the truths of the physical world at the expense of the myths of the metaphysical.

IMPACT OF ICD-10 - Increases Billing Accuracy, Headache for MDs and Patients

I strongly suggest that a pledge to read a synopsis of the philosophy of the 13th century Franciscan William of Ockham on a weekly basis be inserted in the oath of office taken by every government employee. Clearly highlighted should be his nominalist doctrine, Ockham’s razor, which avows that the best solution to a problem is usually the simplest. Pare to a minimum the number of confounding variables.

How do we treat pain? - Unrealistic Goals Leading to Opioid Addiction

In the weekend review from ACEP, two articles caught my attention. The first one was on new guidelines from the American Society of Addictive Medicine on the use of prescription medication to treat opioid addiction. These guidelines were created soon after the Centers for Disease Control and Prevention (CDCP) declared opioid use and resultant death as an epidemic. The second article refers to a study showing that pain is underdiagnosed and undertreated in the ED. This is the challenging dichotomy we live and work in.

Drowning in the Fountain of Youth - Genetic Predisposition

Recently I read in a New York Times magazine article that the 130th richest man in the United States wants to match his age with his Forbes magazine wealth ranking. His riches have not bought him a unique, scientifically-formulated elixir for immortality; nor is he a wacky proponent of perpetual hyperbaric oxygen chambers or cryogenics.

Yelp May Not Help

Concomitant with the metamorphosis of the practice of medicine into the business of healthcare delivery, patients have been transformed into customers. Healthcare providers compete not only on the basis of outcomes, best practices, centers of excellence, advanced technology and cost, but also on customer service

Find and Replace: Genetic Engineering in Science and Medicine

Shakespeare’s Hamlet proclaimed, “What a piece of work is a man,” but now, almost half a millennium later, this could be amended to what a set of sequences is man. The nobility, reason, infinite faculty and admirable form can be attributed to the 20,000 or so genes that contain the chemical code for specific protein formation

HIPAA Protects Millions with Unintended Consequences

The Health Insurance Portability and Accountability Act (HIPAA) was endorsed by Congress in 1996 and was the last significant legislative legacy of Senator Ted Kennedy. It is enforced by the Office for Civil Rights and mandates nationally recognized regulations for use and/or disclosure of an individual's health information by a “covered entity”. Such an entity is a health plan, healthcare clearinghouse or healthcare provider.

Studies Prove Communication and Teambuilding Training a MUST for Surgical And Hospital Staff

Although individual judgment and technical dexterity are obviously important, best surgical outcomes, particularly for complex procedures, reflect the performance of many medical providers before, during and after an operation. Professionalism and a competitive business environment both stimulate medical centers to continuously focus on quality assurance programs, and to improve patient safety.
Page: 123 - All