How much are U.S. doctors worth? Depends who you ask

Is the much higher compensation for U.S. physicians compared with their counterparts in other advanced countries justified?

Noted healthcare blogger Dr. Kevin Pho strongly objected to a blog post last month by Sarah Kliff on the popular Vox website. It cited data showing that even U.S. primary-care doctors earn a lot more than their colleagues abroad. High physician pay is “a pretty significant part of the reason” why the U.S. spends far more per person on healthcare than any other advanced country, she wrote.

This week, Kliff followed up with a piece citing U.S. Bureau of Labor Statistics data showing that various types of physicians occupy nine of the top 10 spots for average wages for U.S. occupations, beating out chief executives. She noted that U.S. orthopedic surgeons earn three times as much on average—$442,000—as French orthopedic surgeons.

Pho countered that such international comparisons showing U.S. doctors making far more are unfair and misleading because they generally do not consider the high cost of medical education and medical liability premiums in the U.S. compared with other countries. He noted that medical education in France is government-subsidized versus the median four-year cost of $287,000 for a private U.S. medical school.

“If you want to pay me like a French doctor, also give me the French cost of medical school and the French medical malpractice system,” he wrote.

International healthcare comparisons are indeed tricky. U.S. practice costs, including overhead and liability premiums, are much higher, and educational costs are considerably greater than in other advanced countries where medical school tuition costs are heavily subsidized.

But as I wrote in a 2012 Medscape article, the income differential for U.S. physicians significantly exceeds those higher U.S. costs.

According to an article in the September 2011 issue of Health Affairs, the income difference after practice expenses between U.S. and British orthopedic surgeons in 2008 was nearly five times the difference in education repayment costs. That means American physicians are earning compensation in excess of what they would need to pay back medical school debt.

"U.S. doctors feel entitled to substantially higher incomes because of that training debt," Gerard Anderson, director of the Johns Hopkins University Center for Hospital Finance and Management, told me back in 2012. "The problem with that argument is they make a lot of money and can essentially pay off that debt in five or so years, then they have another 20 years at much higher salaries than in other countries."

Pho is right, though, that high U.S. physician pay is only a minor component of sky-high U.S. healthcare costs. And other professionals in healthcare, notably hospital, health plan and pharmaceutical executives, generally make even more money. If American physicians' pay were reduced to international levels, Anderson told me in 2012, it would cut annual, per-person U.S. healthcare spending only from $9,000 to $8,700, compared with about $4,500 in other advanced countries.

Follow Harris Meyer on Twitter: @MHHmeyer