Why We Have Physician Income Disparities

I suppose that I had to tackle this spiny cactus sometime, and there are more layers to this subject than the biggest onion you've ever seen (probably with as much crying).

The first thing that has to strike you about this is that there is somehow even an expectation that there should be some kind of income equity among the 700,000 docs in America. Doesn't every other career involve wide disparities and don't we all tacitly understand that?

There is a kind of vague contradictory assumption that a) all doctors are "rich" (whatever that is), and yet, at the same time, b) should somehow be above the fray of common commerce, that we are devoted to a life of selfless service, burning with altruism. Monks in mufti, if you will. I don't know where this idealized fantasy came from, but I know that, for one, my mother had it.

Even stretching for it, I don't think that you can say that across the board pay similarity is even desirable, let alone doable. You could go on past your patience with just the logical reasons why income varies: different work loads, different attitudes, different needs (oops, that sounds Marxist), differing abilities, differing local costs, yada yada yada.

Our fee-for-service system accepts these realities and provides a rough hewn model that allows for many variances. There are drawbacks to fee-for-service of course, such as incentivizing excessive activity. It is likely that the cumulative economic burden from this incentivization alone will be a factor in fee-for-service's eventual demise.

But a salaried alternative, if that is the solution that springs to mind, cannot erase the inevitable differences among people. I have been in several of these environments and they just added fuel to the old adage that you should watch out for unintended consequences. Attempting to fix one problem often creates others, which are sometimes both worse and more numerous.

Part of the problem with income disparity is simply human nature; we all want to do slightly better than our neighbor, whatever that may mean. Part of it is in docs' inadequate preparation for the business world (here I go again). I don't know about you, but money was never once discussed at any point in my training. It just wasn't done. Nor was the later shocking discovery that there is a huge gap between cognitive and procedurally based physicians.

Would any of us have switched our final area of practice if we knew about these income disparities? Some probably would; those torn between two different areas of interest might decide to go where the economic incentives are, and those groaning under unsupportable debt are clearly voting with their stethoscopes and feet.

Then there are the one percenters, the flagrant money-grubbers. We all know of one or two in our baliwicks. Every specialty has a few; they make all of us look bad. Sometimes they get away with it, and some times they don't, but, for most of us, if money was what you were primarily after, medicine does not compare to the opportunities elsewhere, such as in the business world (and there's also that pesky ethical thing).

Yes, docs start at a relatively good pay level...or not, if you consider the extra 7-10 years of foregone potential revenue, bonuses, promotions etc. that we have spotted our college friends going directly into the work force. Further, young docs not only aren't earning commensurately during their training, but have the added burden of an average $150,000 debt to start a career.

Maybe I am prejudiced, living in Silicon Valley, where the geeks who pooh-poohed pre-med are all now driving Bentleys. I remember once being at a cocktail party where I was literally the only person who had not taken a company public. And being patronized is not fun. "Bitter, party of one..." as the old joke goes.

So, we are left with a series of platitudes that both explain and rationalize why docs' incomes vary from each other, and, indeed, why all sorts of careers have variances.

Our effort is not equal, our results are not equal, our knowledge is not equal, and society values and incentivizes us differently. Is it "fair"? That's probably unanswerable and we need to realize that and just grow up. "Why" is also a non-starter, but "how" has more utility. We all have a pretty good idea how to get more money, hopefully ethically and legally, and we have a pretty good idea on what to do with it to achieve our goals. Of course we change, our goals change, society changes and we have to adapt.

That's one reason why you are reading PMD - to acquire extra tools for, and understanding of, our increasingly complex financial lives. Thomas Oakeshott, the 18th century English philosopher, put it very practically, if a bit cynically. He held that our primary job is not gaining some imaginary port of safety in life from the rolling ships at sea that we live on, but rather to maintain a precarious stability while spending out our lives on those continually rough waters.

Bon voyage!