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Sources of U.S. Physician Income: The Contribution of Government Payments to the Specialist–Generalist Income Gap

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Abstract

Background

Physician income varies threefold among specialties. Lower incomes have produced shortages in primary care fields.

Objective

To investigate the impact of government policy on generating income differentials among specialties.

Design and Participants

Cross-sectional analysis of the 2004 MEPS.

Measurements

For outpatient care, total payments made to 27 different types of specialists from five types of payers: Medicare, Medicaid, other government (the Veterans Administration and other state and local programs), private insurance, and out-of-pocket payments. For inpatient care, aggregate (i.e., all-specialty) inpatient physician reimbursement from the five payers.

Results

In 2004, physicians derived 78.6% of their practice income ($149,684 million, 95% CI, $140,784 million—$158,584 million) from outpatient sources and 21.4% of their income ($40,782 million, 95% CI, $36,839 million—$44,724 million) from inpatient sources. Government payers accounted for 32.7% of total physician income. Four specialties derived > 50% of their outpatient income from public sources, including both the lowest and highest paid specialties (geriatrics and hematology/oncology, respectively).

Conclusions

Inter-specialty income differences result, in part, from government decisions.

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Acknowledgements

Maxim D. Shrayer Ph.D. provided constructive comments on earlier drafts of this paper; Melbeth G. Marlang, BA, assisted in manuscript preparation.

Conflict of Interest

None disclosed.

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Authors and Affiliations

  1. Department of Medicine, The Cambridge Health Alliance and Harvard Medical School, Cambridge, MA, USA

    Karen E. Lasser MD, MPH, Steffie Woolhandler MD, MPH & David U. Himmelstein MD

Authors
  1. Karen E. Lasser MD, MPH
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  2. Steffie Woolhandler MD, MPH
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  3. David U. Himmelstein MD
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Corresponding author

Correspondence to Karen E. Lasser MD, MPH.

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Lasser, K.E., Woolhandler, S. & Himmelstein, D.U. Sources of U.S. Physician Income: The Contribution of Government Payments to the Specialist–Generalist Income Gap. J GEN INTERN MED 23, 1477–1481 (2008). https://doi.org/10.1007/s11606-008-0660-7

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  • DOI: https://doi.org/10.1007/s11606-008-0660-7

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