Unhealthy Pressure: How Physician Pay Demands Put the Squeeze on Provincial Health-Care Budgets

Abstract

In the 11 years since the Romanow Commission warned that the income of physicians was threatening to become a significant driver of Canadian health-care costs, doctors in this country proceeded to chalk up some of their most rapid gains in earnings since the implementation of medicare. Since 2000, the gap between what the average physician makes, and what the average fully employed Canadian worker earns, has diverged like never before. In the last decade, the average doctor went from earning three-and-a-half times the average Canadian worker’s salary, to earning nearly four-and-a-half times as much, a more than 25 per cent relative increase. In constant dollars, today’s average Canadian physician is earning about 30 per cent more than he or she was just a decade ago. All of this has occurred while physicians have actually provided slightly fewer services to patients. Since the implementation of medicare, the payment of doctors has been rather a matter of politics, as provinces became the ultimate paymasters for health-care personnel. The natural result was an ongoing competition between provinces and physicians for public support, each with its own claim to being the guardian of public health care. In the last two decades, however, doctors have succeeded in outmaneuvering governments, marshaling greater public support for higher pay for their work, even as provinces have been more often viewed as underfunding basic health care needs. There are signs that this may have finally gone too far: Ontario was recently able to freeze remuneration for doctors in a negotiated contract deal and Alberta shortly after imposed a unilateral settlement on its doctors after breaking off negotiations. Stories about “millionaire doctors” are now proliferating in the mainstream media and, as provinces across the countries struggle with deficits, the public’s sympathy appears to be shifting. There were periods, during the ’70s and ’90s, when governments were successful in holding back the growth in doctors’ fees, to the point where physicians saw their purchasing power shrink. If Canadians are now questioning where the priorities of doctors truly lie — whether its preserving health care or enriching themselves — the provinces can only gain more leverage in future negotiations with doctors. Physicians in the Canadian health-care system are entrusted with a special and protected role, and it behooves medical associations to bear in mind their additional responsibility to promote public health-care objectives. The current collective bargaining model has resulted in provinces pressured into buying healthcare peace by agreeing to continually ratchet up doctors’ pay. It is difficult to see how that can continue. It is time that doctors began working with policy-makers on a new model, one that puts less emphasis on profiting doctors, and more emphasis on promoting a sustainable health-care system for everyone.