A new study on physician salaries is raising pointed questions about pay for US physicians and whether it contributes to rising healthcare costs – that is, if you believe the numbers are accurate.
The study was released in July by the National Bureau of Economic Research (NBER), which produces in-depth reports on a variety of topics.
The current paper is highly technical and may have languished in obscurity were it not for an August 4 article in The Washington Post that examined the findings with the claim that “doctors make more than anyone thought.”
It is indeed true that the NBER’s estimate of physician salaries seems high. The study claims US physicians made an average of $350k in 2017, the year that the researchers focused on by analyzing federal tax records.
- The NBER estimate is far higher than $294k in Medscape’s 2017 report on physician compensation – a 19% difference.
The variation is even greater for diagnostic radiologists. The NBER data claim radiologists had a median annual salary in 2017 of $546k – 38% higher than the $396k average salary listed in Medscape’s 2017 report.
- The NBER numbers from six years ago are even higher than 2022/2023 numbers for radiologist salaries in several recent reports, by Medscape ($483k), Doximity ($504k), and Radiology Business ($482k).
But the NBER researchers claim that by analyzing tax data rather than relying on self-reported earnings, their data are more accurate than previous studies, which they believe underestimate physician salaries by as much as 25%.
- They also estimate that physician salaries make up about 9% of total US healthcare costs.
What difference is it how much physicians make? The WaPo story sparked a debate with 6.1k comments so far, with many readers accusing doctors of contributing to runaway healthcare costs in the US.
- Meanwhile, a thread in the AuntMinnie forums argued whether the NBER numbers were accurate, with some posters warning that the figures could lead to additional cuts in Medicare payments for radiologists.
Lost in the debate over the NBER report is its finding that physician pay makes up only 9% of US healthcare costs. In a medical system that’s rife with overutilization, administrative costs, and duplicated effort across fragmented healthcare networks, physician salaries should be the last target for those who actually want to cut healthcare spending.