Today I am going to write about how the US could save up to 10% on its healthcare bill.
The US spends more on health care than any other nation, $8,500 per person per year. Multiply that by 300 million people and try to grasp the vast sum of $2,5 trillion.
A lot of changes are taking place with the intent to save healthcare dollars. So far, many of those changes have involved creating new layers of middlemen, whose paychecks will come out of the same healthcare budget as MRI’s, prescription medicines and physician salaries.
Every so often physician salaries come into focus as a place where money might be saved. Some people even picture physician pay as a major driver of healthcare costs.
Now, I am just a country doctor, and I don’t have an MBA or any financial background. But I used to be pretty good at math, and I’d like to think I still am.
If the 2.5 trillion dollars this country spends on healthcare is paid to or prescribed by our 850,000 physicians, then each doctor controls 3 million dollars from our nation’s healthcare budget.
Of course, physicians aren’t the only providers or prescribers. I don’t have a figure for how much money is controlled by our 100,000 Nurse Practitioners and 70, 000 Physician Assistants. I also don’t know what portion of our 50,000 chiropractors’ work falls inside the traditional healthcare budget, but let me assume each physician on average controls only 2-2.5 million dollars worth of products or services…
Then, if every physician took a $200,000 pay cut, we could reduce our healthcare spending by up to 10%!
This would be a 50% pay cut for many surgeons, and would actually make the average primary care doctor have to pay Uncle Sam for the privilege of working. I suspect most wouldn’t.
Is 10% too much to pay the providers of the intellectual and procedural services that are still necessary for $3,000 MRIs and $200/month prescriptions to be used for the right reasons and produce the right outcomes for patients?
Would a symphony fire the conductor to save less than 10%? And would we still want to hear the music if they did?
Sources:
http://www.cdc.gov/nchs/fastats/hexpense.htm
http://www.ahrq.gov/research/findings/factsheets/primary/pcwork2/index.html
A Country Doctor Writes: 
I agree with what you wrote….but not completely. I definitely feel doctors should be compensated for their work, training, administrative tasks, and ongoing learning. On the other hand, I digress to a blog post you wrote recently about the quality of the care. I question at what point the quality of care is so diminished that we can really call it “care”.
I have many, MANY anecdotal experiences of family members being misdiagnosed or, well, critical pieces of information about their health being skimmed over. I have noticed, year after year, from watching my kids and my grandboys growing up, how my physicians have become increasingly dependent on bloodwork and to a lesser extent other diagnostics. I have worked to educate myself about what certain diagnostics mean and I’ve since learned that certain test ranges, etc. are not completely or, in many cases at all, accurate or applicable for every person. I’ve come to the point in my life where I realize I have health insurance for emergency care, emergency surgeries, and for diagnostic tests. I’ve come to see my doctors more akin to technicians and interpreters of reports. I have a feeling some have felt undervalued, too, and deemed by an inability to practice with a greater breadth and depth of what they can do.
It was only upon a recent dire ailment that I sought a private M.D. Although I know he is not representative of all “holistic/integrated medicine” doctors, I am happy to have been so fortunate to get an appointment and I can say that I would be dead if it wasn’t for him. I am not trying to be dramatic. I utilized the diagnostic tests that were housed in a major health care system and interpreted by trained M.D.s and gave these to him…and we also talked about my history and how I had been feeling.
I enjoy reading your blog. It is fascinating to view the world through the lens of a practicing physician. I have great respect, too, and empathy for doctors. From a patients perspective, though, when I hear about economics and health care costs it upsets me because, as I’ve said, I feel that quality of the visits my family has received over the years has been so poor (from primary care, to oncology, to podiatry, to pediatrics, etc.). There have been many occasions where I’ve had to prep myself to advocate on my daughters behalf when they were growing up (one doctor didn’t believe my oldest had scoliosis when she complained of back pain; her sister has severe scoliosis and it seems to be prevalent in our family). I have many more stories where I’ve felt belittled or brushed off by physicians. The one really thorough pediatrician my girls had growing up was reprimanded for spending a few extra minutes with patients. She even confided to my wife that her colleagues disliked how patients would always request her or not make an appointment at all.
I’ve shared some anecdotal stories, at the risk of sounding like a whiner…but, on the whole, what I wanted to express is that I wish the dialogue about the quality of care would be voiced as fervently as that of economics.
If I took a $200,000 a year pay cut, I would have to pay about $30,000 to this fund. So it would be like being back in medical school especially the last two years. Fantastic!
Great post! It’s interesting when you describe it like this, but I doubt any physician is willing to take a $200,000 pay cut
It’s definitely an interesting idea when you put it like that, $200,000 pay cut. I personally don’t know many people who would be ok with that
Interesting ideas.. like the others I doubt many are willing to take that big of a cut in their pay, but still interesting..