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                        So how much do doctors really earn?
                        Michael Day

                        BMJ 2007;334;236-237
                        doi:10.1136/bmj.39112.426481.59


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the week in medicine                                                                       The rumbling political row over debt      from 2002-3, when NHS Information
                                                                                           in the NHS means that the vexed           Centre data showed that GPs earnt


so how much                                                                                issue of doctors’ pay is not going to
                                                                                           go away any time soon.
                                                                                              Are doctors in the United
                                                                                                                                     on average £72 000, their earnings
                                                                                                                                     rose by a remarkable 63��.
                                                                                                                                        As a result, the Independent noted,



do doctors
                                                                                           Kingdom overpaid? An obvious way          the average family doctor now
                                                                                           to address the question is to compare     earned, including private income,
                                                                                           the earnings of UK medics with            more than the Lord Chancellor,
                                                                                           those of their overseas colleagues.       ministers of state, senior civil


really earn?
                                                                                           That is easier said than done, though:    servants, and circuit judges.
                                                                                           few if any direct comparisons                The BMA has challenged the
                                                                                           exist, and any comparison is made         reliability of these figures. John Ford,
                                                                                           difficult by different contractual        the head of its economic research
                                                                                           agreements and working conditions.        unit, said that the headline figures
According to the media, some Uk                                                            The UK Treasury has, however,             overestimate the extra amount
general practitioners are reputed to be                                                    made an attempt, in its latest 2007       reaching GPs’ pockets, because under
                                                                                           comprehensive spending review for         the new contract they must now pay
earning around £250 000 a year, but                                                        the NHS.                                  employees’ pension contributions.
what is the truth behind the headlines,                                                       The report contains estimates
                                                                                           of average earnings of GPs and
                                                                                                                                        He adds that the sample of
                                                                                                                                     practices used in the Independent’s
and how does Uk doctors’ pay                                                               hospital doctors in 2003-4 in 16          estimates was unrepresentative,
                                                                                           countries, including the UK’s major       because it included a larger than
here compare with elsewhere, asks                                                          competitors. The figures are based        average number of dispensing
Michael Day                                                                                on research gathered by British           practices. Also, the BMA points out
                                                                                           embassies. It should be emphasised        that salaried GPs (who often work
                                                                                           that the figures are estimates.           part time in return for a guaranteed
                                                                                                                                     income) earn rather less; it estimates
                                                                                           A widening gap                            their income to be in the region of
                                                                                           Nevertheless, a few things leap out       £70 000 a year.
                                      AVERAGE INCOME OF                                    from the data, including the large           The headline grabbing figures
                                   HOSPITAL DOCTORS (2003-4)*                              (and, in the case of hospital salaries,   of £250 000 annual earnings of a
                                                                                           huge) lead that US doctors enjoy in       handful of GPs is, said Mr Ford,
                         100                                                               pay terms. The second is the very         down to a few practices exploiting
Average income (£000s)




                                                                                           large advantage that UK doctors have      the potential of dispensing practices
                          80
                                                                                           over their continental colleagues.        rather than being the result of the
                          60                                                               GPs in Italy have remarkably low          new contract.
                                                                                           average earnings—the result of the           It’s not in doubt, however, that GP
                          40                                                               marketplace being flooded with too        partners have enjoyed very large pay
                                                                                           many doctors.                             increases in the last three years. And
                          20
                                                                                              Bear in mind that these are 2003       inevitably the contract that has led to
                           0                                                               figures. The latest, very large pay       the “pay bonanza,” as the newspapers
                                   UK   Germany Germany France        Spain     Italy      rises given to UK doctors will almost     have called it, has come under
                                          (self    (hospital
                                        employed) employed)                                certainly have widened the salary         fire. When reports of GPs earning
                                                        *Full US data not available, but   gap between British and continental       £250 000 a year broke last year,
  Source: HM Treasury                                average is estimated at >£135 000     doctors even further.                     the Sun newspaper, in an editorial
                                                                                              The Treasury report cites an           entitled “Wads up doc,” said it made
                               AVERAGE INCOME OF PRIMARY                                   average salary for GPs in the UK in       sense “to cap doctors’ salaries and
                                 CARE DOCTORS (2003-4)                                     2003-4 of £82 000. The latest figures,    stop patients being short changed.”
                                                                                           for 2004-5, show that the average            Some of the broadsheets joined in.
                         100                                                               income of GPs, net of expenses, was       The Daily Telegraph’s Simon Heffer
Average income (£000s)




                                                                                           £106 000, a rise of 30�� in one year.     said: “I do not doubt that many GPs
                          80
                                                                                           For dispensing GPs the figure is even     work hard . . . However, equally I
                          60                                                               higher: they earned an average of         do not doubt that a few are royally
                                                                                           £128 000 after expenses, a 31�� rise.     ripping off the Government and the
                          40                                                                  In January the Independent             taxpayer thanks to the stupidity with
                                                                                           newspaper reported that GPs’              which the Government settled its deal
                          20                                                               average earnings soared again last        with their trade union.”
                           0
                                                                                           year (2005-6) to £118 000, according
                               US          UK     Germany France      Spain     Italy      to estimates of the Association of        Renegotiations are under way
  Source: HM Treasury
                                                                                           Independent Specialist Medical            Some leading health economists,
                                                                                           Accountants. So in the three years        such as John Appleby of the think

236	                           	             	                                                                                                 BMJ | 3 feBrUArY 2007 | VolUMe 334
                                                                                                              observations
                                                Downloaded from bmj.com on 30 September 2008


tank the King’s Fund, say that the                                                                                  Left: how the London
recent contracts are “not set in stone.”                                                                       evening standard covered
Professor Appleby says that behind                                                                             claims about high earning
the scene renegotiations are already                                                                            GPs last year, and, below,
under way.                                                                                                           the front page of the
  In terms of the consultants’                                                                                   tabloid Daily Mail earlier
contract, ministers will be seeking                                                                                             this week
to include new incentives to boost
productivity rather than simply
to reward the amount of time
consultants spend in hospital. But
the BMA says that initial predictions
of the size of consultants’ pay rises
under their new contract have proved
wide of the mark.
  Between 2003-4 and 2004-5 their
earnings rose by around 20�� as the
number of work sessions they attended
rose from 10 to 12. Since then, how-
ever, Mr Ford says that rises in their
salaries have stalled.
  As far as GPs are concerned,
ministers are keen to make
performance related targets tougher.
The BMA insists that the new
contract had radically improved the
care of patients, particularly for those
with chronic diseases.
  Hamish Meldrum, head of the
BMA’s GPs committee, said, “In the
area of raised blood pressure alone,
GP care under the new contract
means that over a five year period
8700 patients in England will avoid
having a heart attack, stroke, angina,
or heart failure.”
  Nevertheless, outside the BMA
there is a groundswell of opinion
that GPs are being too generously
rewarded for providing some aspects
of care that should already have been
regarded as routine.
  Also, other observers, such as Niall
Dickson, chief executive of the King’s
Fund, say that the contract may
actually have cut GPs’ productivity
by allowing the closure of Saturday
morning surgeries and the ending of
24 hour cover.
  The government believes that
value for money and its own pride
could be partially restored if
family doctors were to invest more
of their expanding profits back
into their businesses to improve
patients’ care. If that’s the case,
                                                    “in the area of raised blood pressure alone, GP care under the new
say its critics, then ministers should
have drawn up a contract that                       contract means that over a five year period 8700 patients in england will
required this.                                      avoid having a heart attack, stroke, angina, or heart failure”
michael day is a freelance journalist, London       Head of the BMA’s GPs committee Hamish Meldrum
miday@f2s.com

BMJ | 3 feBrUArY 2007 | VolUMe 334                                                                                                     237
 observations
                                              Downloaded from bmj.com on 30 September 2008




  ATLANTIC CROSSING Uwe e reinhardt

  is the president’s plan dead before arrival?
  Bush’s proposed health reforms would do little for the millions of low income, uninsured Americans
  In his State of the Union address of      proposal upon which Bush dwelt in                                 triggered by the proposed standard
  23 January, President Bush unveiled       his speech. On average, a standard                                tax deductions continue to accrue
  his much heralded health reform           health insurance policy for an                                    disproportionately to high income
  initiative to a perplexed nation.         American family now costs about                                   families least in need of public
  As is their wont, the television          $12 000, although by 2009, the onset                              subsidies for their health care.
  media swiftly unearthed staunch           of the president’s plan, that figure                                  Worse still, in addition to these
  proponents and staunch opponents          is bound to be closer to $14 000.                                 standard deductions, the
  of the proposal, and unleashed            Americans whose employer in 2009                                  president apparently would continue
  the extremists upon one another,          spent more on health insurance                                    to allow individuals or families to
  thus adding to the confusion. It          premiums than the standard                                        deduct from their taxable incomes




                                                                                        “
  did not help that the president           deductions would, of course, pay                                  annual deposits into a personal
  delicately omitted from his speech        added taxes on the excess. Because                                health savings account, as long as
  an important but politically risqué       the standard deductions would be                                  the family chose a health
  feature of his proposal, most likely      indexed over time only to general           the huge tax          insurance policy with a high
  to enhance the public marketability       price inflation and not the much            savings . . .         deductible.
  of the policy (www.whitehouse.            higher rate of inflation for health care,   continue to accrue        At the same time, Bush would do
  gov/stateoftheunion/2007/index.           more and more Americans would find          disproportionately    little for the millions of low income,
  html).                                    themselves in that position as time                               uninsured Americans who would
                                                                                        to high income
     The full proposal has three distinct   goes on.                                                          not much benefit from the standard
                                                                                        families least in
  facets.                                       Thirdly, the president would                                  tax deductions, especially if their
     Firstly, the president would make      redirect funds the federal government
                                                                                        need of public        income is so low that they do not
  health insurance premiums paid by         already spends on health care to            subsidies for their   pay federal income taxes and who




                                                                                        ”
  employers on behalf of employees—         the budgets of state governors,             health care           lack the income to procure health
  hitherto not included in the              who could use these funds to help                                 insurance on their own. Simply to
  employees’ taxable compensation—          their citizens gain access to health                              redirect federal funds from safety net
  fully taxable with effect from 1          insurance. Neither Bush nor the                                   hospitals catering disproportionately
  January 2009. The total loss to the       White House fact sheet identifies                                 to the poor towards general state
  US Treasury from this time hallowed       which money already being spent                                   budgets, without any guarantee
  tax preference has been estimated         would be redirected towards state                                 of full universal health insurance
  to range currently from $200bn to         government budgets, nor what the                                  coverage, is a morally dubious,
  $220bn (£102bn to £112bn; €154bn          total sum of those funds might be.                                empty gesture—especially in light
  to €170bn) a year, more than twice        Everyone’s best guess is that the                                 of the unwarranted public subsidies
  the sum that would be needed to           president has in mind the so called                               the proposal would continue to steer
  move the nation to full universal         disproportionate share (DSH) funds                                towards high income families.
  health insurance coverage.                now paid to hospitals that treat a                                    As it happens, all of these
     By itself, then, this facet of the     disproportionate share of uninsured                               musings are moot. The Democratic
  proposal amounts to a sizeable            patients or patients covered by the                               Congress already has signalled
  tax increase. It is this facet of the     federal-state Medicaid programme                                  that the president’s plan is not only
  president’s proposal that he              for the poor. In many states these                                “dead on arrival” but “dead even
  delicately omitted from his               funds pay hospitals far less than                                 before arrival.” And thus, after all the
  televised speech, although it is          it costs them to treat Medicaid                                   fanfare over the president’s proposal
  clearly set out in the associated         patients. Mentioning such specifics                               has died down, American health
  fact sheet on the White House             in a televised speech would have                                  policy continues to march according
  website (www.whitehouse.gov/              triggered an immediate outcry                                     to Churchill’s dictum that “you can
  stateoftheunion/2007/initiatives/         from the hospital industry and the                                always count on Americans to do
  healthcare.html).                         champions of the poor.                                            the right thing—after they’ve tried
     Secondly, the president would              Economists of all political stripes                           everything else.”
  allow Americans, regardless of            have remarked favourably upon                                     Uwe E Reinhardt is James Madison
  insurance status, to deduct from          the proposed changes in the tax                                   professor of political economy,
  taxable income $7500 for individual       code. However, the president’s plan                               Princeton University, Princeton, NJ,
  tax payers or $15 000 for a family.       perpetuates the regressive nature of                              United States
  This is the felicitous facet of the       tax deductions. The huge tax savings                              reinhard@princeton.edu



238	      	         	                                                                                                  BMJ | 3 fEBRUARY 2007 | VolUME 334

				
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