|September 08, 2011||
High Doctor Fees, Not Practice Costs, Drive Higher Health Care Spending on Physicians in the United States Compared to Other Countries
New Analysis Shows US Orthopedic Surgeons Charge Twice as Much for Hip Replacements as Counterparts in Five Other Industrialized Countries
Bethesda, MD -- Research appearing in the September issue of Health Affairs shows that physicians in the United States are paid more per service than doctors in other countries--in some cases double. There is also a far bigger gap between fees paid for primary care and fees paid for specialty care in the United States, compared to other countries. These higher fees in turn lead to higher incomes for US physicians than those earned by their foreign counterparts, and are the main driver of higher overall spending in the United States on physicians' services.
The study--by Miriam Laugesen of the Mailman School of Public Health at Columbia University and Sherry A. Glied, also of the Mailman School and currently serving as assistant secretary for planning and evaluation at the US Department of Health and Human Services--compared fees paid by public and private payers for primary care office visits and hip replacements in Australia, Canada, France, Germany, the United Kingdom, and the United States.
It found that US primary care physicians were paid on average 27 percent more by public payers for an office visit, and 70 percent more by private payers for an office visit, compared to the average amount paid in other countries. However, the largest difference in fees paid to US physicians versus fees paid to doctors in other countries was for hip replacements. US physicians were paid 70 percent more for these procedures by public payers, and 120 percent more by private payers, than the average fees paid to physicians in the other countries studied.
"The gap between the fees paid for primary care and those for orthopedic services such as hip replacements is significantly bigger in the United States than it is in other countries," says lead author Miriam Laugesen. "For decades, policy makers and medical leaders in this country have debated financial incentives to spur more doctors to become primary care physicians. Our work shows that continuing attention needs to be paid to the difference in payments across specialties, and how we can get better value for those expenditures."
The gap in fees paid to doctors for hip replacements was even higher. The public fees paid to doctors for hip replacement ranged from a low of $652 in Canada to a high of $1,634 in the United States. The difference in fees to doctors paid by private insurers was substantially higher still: fees paid to US physicians were double that charged in other countries--for example, $1,340 in France versus $3,996 in the United States.
The study underscores that the biggest disparities in US pay to physicians are on the private side. Fees paid by large private national insurers in six markets in the United States averaged about one-third above Medicare rates for primary care and 50 percent higher than Medicare for hip replacements. Private insurers have been less successful in negotiating fees with orthopedic surgeons than with generalist physicians, says the study.
The gap in salaries between the primary care physicians and orthopedists was also significantly higher in the United States, where primary care physicians earned just 42 percent as much as orthopedic surgeons did. In contrast, primary care physicians in Canada, France, and Germany earned about 60 percent as much as orthopedic surgeons did there.
The finding that US health care fees and spending are higher than in other countries is nothing new. However, the study concludes that the higher fees paid to physicians--rather than factors such as higher practice costs, volume of services, or medical school tuition expenses--are the main drivers of higher US spending on physicians, particularly in orthopedics. As policy makers look for ways to restrain health care spending, findings from the new study could provide impetus for targeting physician fees to reap desired savings.
|About Health Affairs|
Health Affairs, published by Project HOPE, is the leading journal of health policy. The peer-reviewed journal appears each month in print, with additional Web First papers published weekly at www.healthaffairs.org. You can also find the journal on Facebook and Twitter and download Narrative Matters on iTunes. Address inquiries to Sue Ducat at (301) 841-9962 or firstname.lastname@example.org