Doctors are paid higher fees in the United States than in several other countries, and this is a major factor in the nation's higher overall cost of health care, says a new study by two Columbia University professors, one of whom is now a top health official in the Obama administration.
"American primary care and orthopedic physicians are paid more for each service than are their counterparts in Australia, Canada, France, Germany and the United Kingdom," said the study, by Sherry A. Glied, an assistant secretary of health and human services, and Miriam J. Laugesen, an assistant professor of health policy at Columbia.
The study, being published Thursday in the journal Health Affairs, found that the incomes of primary care doctors and orthopedic surgeons were substantially higher in the United States than in other countries. Moreover, it said, the difference results mainly from higher fees, not from higher costs of the doctors' medical practice, a larger number or volume of services or higher medical school tuition.
Such higher fees are driving the higher spending on doctors' services, the study concluded.
Ms. Glied, an economist, was a Columbia professor before President Obama named her assistant health secretary for planning and evaluation in June 2010. She said the paper, based on academic research, did not reflect the official views of the administration or the White House.
But the journal said the findings suggested that, as policymakers struggle to find ways to restrain health spending, they might consider doctors' fees. Doctors have generally been excluded from recent cost-cutting proposals because under existing law, Medicare, the federal insurance program for older people, will reduce their fees by 29.5 percent on Jan. 1. In addition, many states have frozen or reduced fees paid to doctors treating poor people under Medicaid.
The study examined fees paid by public programs and private insurers for basic office visits and for hip replacement surgery, and found that Americans were "very low users of office visits and relatively high users of hip replacement surgery."
"Fees paid by public payers to orthopedic surgeons for hip replacements in the United States are considerably higher than comparable fees for hip replacements in other countries," the authors found, "and fees paid by private insurers in the United States for this service are double the fees paid in the private sector elsewhere."
For primary care office visits, the gap between fees paid by Medicare and by public programs in other countries was smaller. But the study found that private insurers paid more for such services here than in other countries.
"U.S. primary care physicians earn about one-third more than do their counterparts elsewhere," mainly "because a much larger share of their incomes is derived from private insurance," the study said.
Ms. Laugesen and Ms. Glied said that among primary care doctors, those in the United States had the highest annual pretax earnings after expenses — an average of $186,582 in 2008 — while those in Australia and France had the lowest earnings, $92,844 and $95,585.
"Among orthopedic surgeons, those who had the highest annual pretax incomes, net of expenses, were in the United States," with an average of $442,450, the study said. In Britain, which ranked second, the comparable figure was $324,138. Annual pretax earnings of orthopedic surgeons in the other countries were less than $210,000.
Medical students often cite higher pay as a reason for choosing to become specialists, and the researchers said the income gap between primary care doctors and orthopedic surgeons was larger here than elsewhere.
"In the United States, primary care doctors earned only about 42 percent as much as orthopedic surgeons earned," the study said. "In Canada, France and Germany, in contrast, primary care doctors earned at least 60 percent as much as orthopedic surgeons earned."
"High physician fees in the United States may reflect the cost of attracting skilled candidates to medicine in a society with a relatively more skewed income distribution," the study said.
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