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Doctors' pay: a glimpse of the big picture

Ensuring that there is a sufficient number of health professionals and a good mix of nurses, doctors and others is essential for a well-functioning health system.

Shortages can spell disaster, while excess numbers in any one area can result in costly waste. Getting it right is particularly important because the remuneration of health professionals is the single largest expense in our health system.

While we wring our hands constantly over the rising cost of drugs and the massive investments required in infrastructure, the main cost driver in our health system is wages.

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Of the $172-billion that Canadians spent on health care in 2008, probably close to half that money went to pay for doctors, nurses and other health professionals. And the word "probably" needs to be underlined because no one really knows.

Delivering health care is labour-intensive and requires the efforts of highly skilled individuals, yet we rarely acknowledge this reality.

Instead, we content ourselves with uttering platitudes such as, "there is a doctor shortage" and "doctors are underpaid."

While these statements may ultimately be true, they lack proof and context. If there is a doctor shortage, then we need to know the ideal number and mix of doctors, and no one has figured out that formula. Doctors may well be underpaid, but to say so honestly, we need to know what they are actually paid and how that compares with others doing similar work in Canada or in other countries.

That is why a new report published by the Organization for Economic Co-operation and Development, which compares the remuneration of doctors in 14 Western countries, is a welcome bit of fodder to the discussion.

The OECD notes that remuneration is a critical factor in attracting and retaining skilled workers such as doctors, particularly in a world where health professionals are mobile and in demand.

Understanding the impact of remuneration - how much and the manner in which doctors are paid - is also a vital concern for health policy-makers who are seeking to improve the access, efficiency and quality of care, while controlling costs.

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So how do Canadian doctors stack up?

According to the latest figures from the Canadian Institute for Health Information, physicians, overall, earn an average of $237,492 a year, but there are huge variations among specialties and from province to province.

The OECD uses a less straightforward number - a common currency, the U.S. dollar, adjusted for purchasing power parity - but it allows direct comparison between countries.

The OECD figures indicate that Canadian family doctors are mid-pack, earning about $106,000 a year, compared with $146,000 in the United States, $121,000 in Britain, $108,000 in Switzerland, $84,000 in France and $56,000 in Finland.

Canadian specialists do a little better when compared with those in other countries, though, again, the variations are broad. Canada's specialists earn $159,000, compared with $236,000 for those in the United States, $153,000 in Britain, $144,000 in France and $76,000 in Finland.

So the next time you hear a doctor complain about her pay, tell her she should be thankful she doesn't work in Finland.

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Snarkiness aside, Finland stands out because physicians are paid almost exclusively on a salaried basis. In countries such as Canada, where the fee-for-service method dominates for general practitioners and specialists, wages are higher and costs more difficult to control.

This, naturally, leads to the issue of productivity. The OECD study shows that Canada's doctors work, on average, about 10 hours a week more than those in Finland - 53 hours compared with 43 hours.

But working hours alone do not explain the huge variations in income, as U.S. doctors work almost the same number of hours weekly as their Canadian counterparts.

So what does the report say about shortages? As it turns out, not very much, though it underscores that there is a growing wage gap between GPs and specialists that seems to be fuelling a shortage of family doctors in many countries.

It also shows there are widely varying approaches to the provision of care.

Canada has one family doctor and 1.1 specialists per 1,000 population - slightly more than the OECD average for family doctors (0.8:1,000) and lower than the average for specialists (1.7:1,000). This reflects the fact that Canada's GPs have a key gatekeeper function - in most instances, only GPs can refer patients to specialists.

France, which was deemed to have the best health system in the world a few years back, has significantly more GPs (1.6:1,000) and specialists (1.7:1,000), but pays them markedly less than Canada does. And the Netherlands, which has an excellent health care system, and where everyone has a family doctor and waits are virtually unheard of, has the most meagre number of GPs (0.5:1,000) and specialists (0.9:1,000).

The OECD's report on physician remuneration demonstrates that, as with everything in health, the complexities are dizzying and simple solutions non-existent.

But it also reminds us that there is much to learn from other health systems; we spend too much time navel-gazing and not nearly enough looking outward.

What they earn

Comparing doctors' salaries internationally:


COUNTRIES, $U.S. (in thousands, adjusted for purchasing power parity)

United States (2003)* 146 Self-employed
Britain (2004)** 121 Self-employed
Netherlands (2004)* 120 Self-employed
Germany (2004)* 112 Self-employed
Iceland (2005)* 109 Salaried
Austria (2003)** 108 Self-employed
Luxembourg (2003)* 108 Self-employed
Switzerland (2003)** 108 Self-employed
Canada (2004)* 106 Self-employed
France (2004)* 84 Self-employed
Finland (2004)* 56 Salaried
Czech Republic (2004)* 39 Self-employed



Iceland (2005)* 3.5 Salaried
United States (2003)* 3.4 Self-employed
Germany (2004)* 3.3 Self-employed
Canada (2004)* 3.2 Self-employed
Austria (2003)** 3.2 Self-employed
Britain (2004)** 3.1 Self-employed
Netherlands (2004)* 3.1 Self-employed
Switzerland (2003)** 2.6 Self-employed
France (2004)* 2.6 Self-employed
Luxembourg (2003)* 2.4 Self-employed
Czech Republic (2004)* 2.4 Self-employed
Finland (2004)* 1.8 Salaried

*Refers only to physicians practising full-time

** Refers to the average remuneration for all full-time and part-time physicians. In Austria, Switzerland and the United States, the data refer to all physicians (both salaried and self-employed), but since most GPs are not salaried in these countries, they are presented as referring to self-employed physicians.



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