An economic model of general practice.

Abstract

The public perceives that doctors earn too much, while general practitioners complain that their income is dwindling . In the absence of reliable data on doctors' incomes, it is impossible to determine whether medical fees are set appropriately, and what effects Medicare might have on general practice. An economic model of practice, using estimates of income and expenditure derived from specified assumptions, was constructed. Then, the effects of changes in various parameters of the model were examined in turn to show how economic forces are likely to affect the behaviour of doctors. It is shown that a general practitioner working at a moderate rate during a normal working week will earn a low income under current schedule fees. Some implications of these findings for practitioners, fee setting, and the public are explored.