Pay Doctors Less

A blog about business and economics.
Feb. 26 2013 9:03 AM

American Doctors Are Overpaid

Making medical education cheaper in exchange for pushing doctors' reimbursement rates down should be a no-brainer

Photo by Ashraf Shazly/AFP/Getty Images

High compensation for physicians is not the reason that health care services are so expensive in the United States. But the idea that Medicare underpays doctors is often cited as an objection to single-payer health care or other alternative schemes that would push prices down to something more like what Medicare pays. As I argue in a new column, this is total nonsense—by international standards, America has the highest-paid doctors in the world, admissions standards at U.S. medical schools have been getting tighter, it's getting harder for medical school graduates to find residency slots, a lot of what doctors do could be done by nurse-practitioners instead, and our immigration system doesn't do enough to let foreign health care professionals move here. Doctors' income is the last thing we should be worried about.

As I do note in the piece, however, American doctors can legitimately complain that they leave school with more debt than foreign doctors and also that they're exposed to more liability risk. These should be easily solved problems. Making medical education much cheaper in exchange for pushing doctors' reimbursement rates down should be a total no-brainer, and the exact level of financial assistance could be tied to assessments of needs of particular kinds of doctors (i.e., more generous terms for GPs than plastic surgeons).


The malpractice issue is less straightforward but should also be resolvable on a similar basis. One important reason people need the right to sue their health care providers in the United States is that getting treatment is so damn expensive. A bad situation immediately sets off a furious scramble to see who's going to get stuck with the bill. The insurance company? The patient? Some previous doctor in the chain? If access to care is cheap and easy, this becomes a much less pressing concern, and protecting doctors much more against liability makes a ton of sense.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.


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