“Understanding trends in physician earnings is important given health care cost growth and proposed Medicare physician fee reductions,” writes Seth A. Seabury, Ph.D., of the RAND Corporation, Santa Monica, Calif., and colleagues. National surveys find that annual physician incomes decreased between 1995 and 2003. Other surveys suggest that physician incomes increased only slightly since 2004. “However, little is known about how growth in physician earnings compares with other health professionals. Comparing physicians and other health professionals is necessary to assess whether physician labor earnings have outpaced or lagged behind earnings growth of other workers in the health care sector.”
As reported in a Research Letter, the authors estimated annual earnings and hourly wages of physicians and other health professionals from the Current Population Survey (CPS), a nationally representative monthly survey of approximately 60,000 households, and examined growth rates from 1987-1990 to 1996-2000 and from 1996-2000 to 2006-2010. This sample included 30,556 respondents across all years who reported working as health professionals, including 6,258 physicians (20.5 percent).
The researchers found that physician earnings fluctuated over the study period. During 1987-1990, median (midpoint) earnings for physicians were $143,963 compared with $157,751 during 2006-2010 ($13,788 increase or growth of 9.6 percent). Other health professionals experienced larger growth in earnings from 1987-1990 to 2006-2010 (e.g., pharmacists earnings increased by $30,938 or 44.0 percent). From 1996-2000 to 2006-2010, there was no significant growth in adjusted earnings for physicians (-1.6 percent). Adjusted earnings continued to increase for other health professionals from 1996-2000 to 2006-2010 (e.g., pharmacists, 34.4 percent). Similar patterns were noted for wages.
“Despite attention paid to higher earnings of physicians in the United States compared with other countries, physician earnings grew less than those of other health professionals in the last 15 years. Possible explanations include managed care growth, Medicaid payment cuts, sluggish Medicare payment growth, or bargaining by insurance companies. Despite lack of recent growth, physician earnings remain higher than other occupations.”