Health Policy 122 (2018) 94–101
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Health Policy journal homepage: www.elsevier.com/locate/healthpol
Review
How much do cancer specialists earn? A comparison of physician fees and remuneration in oncology and radiology in high-income countries Seán Boyle a,∗ , Jeremy Petch b , Kathy Batt c , Isabelle Durand-Zaleski d , Sarah Thomson e a
School of Health and Social Care, London South Bank University, London, SE1 0AA, UK Li Ka Shing Centre for Healthcare Analytics Research and Training (LKS-CHART), St. Michael’s Hospital, Institute of Health Policy, Management and Evaluation at the University of Toronto, 30 Bond St, Toronto, Ontario, M5 B 1W8, Canada c Internal Medicine—Hematology and Oncology, Comprehensive Cancer Center, Medical Center Boulevard, Winston-Salem, NC 27157, USA d AP-HP Santé Publique Hôpital Henri Mondor, 51 avenue du maréchal de Lattre de Tassigny, F 94010 Créteil, ECEVE –UMR1123 – INSERM, France e WHO Barcelona Office for Health Systems Strengthening, Sant Pau Art Nouveau Site, Nostra Senyora de La Mercè pavilion, Sant Antoni Maria Claret, 167, 08025 Barcelona, Spain b
a r t i c l e
i n f o
Article history: Received 5 October 2016 Received in revised form 24 July 2017 Accepted 3 November 2017 Keywords: Health spending Physician payment Cost of health care Oncology International comparison
a b s t r a c t The main driver of higher spending on health care in the US is believed to be substantially higher fees paid to US physicians in comparison with other countries. We aim to compare physician incomes in radiology and oncology considering differences in relation to fees paid, physician capacity and volume of services provided in five countries: the United States, Canada, Australia, France and the United Kingdom. The fee for a consultation with a specialist in oncology varies threefold across countries, and more than fourfold for chemotherapy. There is also a three to fourfold variation in fees for ultrasound and CT scans. Physician earnings in the US are greater than in other countries in both oncology and radiology, more than three times higher than in the UK; Canadian oncologists and radiologists earn considerably more than their European counterparts. Although challenging, benchmarking earnings and fees for similar health care activities across countries, and understanding the factors that explain any differences, can provide valuable insights for policy makers trying to enhance efficiency and quality in service delivery, especially in the face of rising care costs. © 2017 Elsevier B.V. All rights reserved.
1. Introduction Recent analysis has shown how aggregate data on physician incomes available in international databases are unreliable; for example, Kok et al. [1] note OECD physician income data are not based on a consistent application of the definition of gross physician income. To address this issue, researchers have tried to produce more accurate estimates focusing on a small selection of countries and on specific physician specialties. Laugesen and Glied [2] compared physician income in the United States (US) with that in five other high-income countries, producing estimates for two specialties: primary care physicians and orthopaedic surgeons. They concluded that the main driver of higher spending on health care
∗ Corresponding author. E-mail addresses: rescue
[email protected] (S. Boyle),
[email protected] (J. Petch),
[email protected] (K. Batt),
[email protected] (I. Durand-Zaleski). https://doi.org/10.1016/j.healthpol.2017.11.003 0168-8510/© 2017 Elsevier B.V. All rights reserved.
in the US was the substantially higher fees paid to US physicians in comparison with other countries, particularly in orthopaedics, rather than factors such as higher practice costs, a higher volume of services, or higher costs for physician training and education. In 2015, Kok et al. [1] compared all physician incomes across six European countries and found that levels of income were positively associated with a lower number of doctors per head of population. This paper builds on the work of Laugesen and Glied [2] and Kok et al. [1] by comparing physician fees and incomes in two specialties – radiology and oncology – as they pertain to a particular area of medicine (cancer care). Cancer is one of the leading causes of death in high-income countries with significant implications for costs and health system resource utilisation. In the US, the American Society of Clinical Oncology (ASCO) reports that by 2030, cancer will be the leading cause of death with a projected 46% increase in absolute terms in new cancer cases, yet demand for oncology services will have outgrown the supply of oncologists [3]. Furthermore, ASCO reports the annual cost of treating cancer in the US is projected to increase from $113 billion (2010 US$) in 2006 to more than $173
S. Boyle et al. / Health Policy 122 (2018) 94–101
billion (2010 US$) in 2020. The evaluation of oncologic specialties, therefore, has practical relevance in high-income countries. We compare and discuss differences in physician earnings for cancer services in five countries: the US, Canada (Ontario), Australia, France and the United Kingdom (UK, England). We hypothesize that in each country, physician earnings will depend on the interaction between a number of factors including the level of fees, the rate at which services are used (volume), different payment, tax and pension structures, and the level of competition between physicians, which depends on the supply of specialists and ease of entry to the market, which in turn suggests that set-up costs for the physician in terms of training and physical infrastructure may also be important.
1.1. Background Health care coverage differs in fundamental ways across these five countries; as well as having a substantial impact on access to services, this may also affect how care is delivered and how much physicians earn. Table 1 sets out the key elements of cancer health care coverage by country. The most notable differences are between the US and the other countries; in particular, the US does not provide universal coverage for its population. Thus its publicly-financed health insurance is limited to the poor and older households, specific medical diagnoses and the veteran population; private insurers therefore play a significant role in covering other households. France and the UK are the only countries that do not require cancer patients to pay anything out-of-pocket at the point of use (when using publicly-covered services). The structure of cancer care also differs from country to country, further complicating the task of comparison. Although the fundamentals of care provided remain the same, the way in which care is delivered and the nomenclature used to classify professionals differs. Table 2 outlines the different features of each system, describing the structure of clinical roles, physician practice, payment systems for clinicians, and training and education requirements. More detail on each is provided in an on-line appendix that provides additional information on all data sources. Each of these elements may affect the relative costs of providing oncology and radiology services across the five countries. Canada is the only one of the five countries that does not allow physicians to engage in a mixture of publicly- and privatelyfinanced work. In Canada, there is no private funding of specialist services for medical and radiation oncology. In the four other countries, specialists working in cancer care are likely to obtain a significant share of their income from privately-financed work. Across the five countries, payment mechanisms generally vary depending on where a specialist is based: if hospital-based, a specialist is usually paid a salary; if in office-based practices, a specialist usually receives fee-for-service (FFS) payment. In Australia, France and the UK (England), however, the method of payment depends mainly on whether the service provided is publicly-financed (usually salary payment) or privately-financed (usually FFS). There are some country-specific differences in payment between specialties. In Canada, most radiologists are paid on an FFS basis, whereas in the US they mainly work as salaried employees in hospitals. Like the other papers, our analysis raises questions about the possibility of achieving genuine comparisons across countries. The daily work routine of these specialists varies between countries, as do the services they provide, the associated expenses (which may also differ depending on the delivery setting), reimbursement methods and the payors. There is also variation in the income data used, eg whether it is net or gross of taxes and expenses, which often come from disparate sources even within the same country, resulting in a lack of consistency between countries.
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2. Materials and methods As Kok et al. [1] have pointed out, great care must be taken to ensure like is compared with like when discussing physician fees and earnings across different countries. Issues for consideration include: ensuring that each country has the same definition of physicians; that the same sources of income and work-related costs are included in each country; whether income is pre- or posttax; the number of hours of work; and the inclusion of all relevant costs against which income must be offset. Large sources of income can be missed; for example, where physicians operate in a mixed economy, private work is often excluded from national databases. In a similar way work-related costs must include everything relevant to the physician’s performance of their work; for example payments for office space, administrative staff, etc. Comparisons also must account for differences in the quantity of physician time involved as well as differences in tax and pension regimes.
2.1. Data and definitions In this paper we provide information on the fees paid to oncology and radiology specialists by public payers for selected services (or in the case of a country such as the UK, where most activity is in the public sector and physicians are most often salaried, the price paid per service). Ideally we would have included information on fees for all services provided by these specialists, and then summed these to generate estimates of total payments to physicians and thereby determine an approximate income per physician. However, producing comparable data for all services across all five countries was beyond the scope of this paper. Instead, we selected typical services or activities. The choice of typical unit of activity is key although not straightforward for oncology and radiology. We do not attempt a definitive answer to how activity should typically be measured: in practice, our choice of measure or measures has been guided by what is readily available in each country. In most countries, it has been common to measure hospital activity by episodes of care or by the number of outpatient appointments or office visits. Although running the risk of oversimplification, for oncologists we use simple measures of two types of activity: ‘first’ outpatient appointments (new consultations with a specialist); and, the provision of a cycle of chemotherapy. Even these measures present complications when compared within and across countries. Similarly, measuring activity in radiology is not straightforward. Various methods have been developed in recent years to measure the activity of clinical radiology specialists. All try to account for the fact that the workload involves a number of tasks, each of which represents different levels of time and complexity (see [4,5]). A mixture of a range of activity measures would probably encompass what radiology specialists do, but for the purposes of this paper we consider just two: the number of ultrasound scans and the number of CT scans. Our main aim is to compare other countries with the position in the US as a whole, following the approach of Laugesen and Glied [2]. In the case of the US, Canada, the UK and France, our description of each system relies heavily on the knowledge and research of our authors from these countries, who are either cancer care clinicians themselves or researchers in the area, or both. In the case of Australia we worked with colleagues there to describe the system and to access and use appropriate data sources. We extracted information from the dominant fee schedules in each country as well as information on sources and levels of income for cancer care specialists. We provide prices for the four activities in Table 5 below, as well as utilisation rates for CT scans and ultrasound. We were
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Table 1 Coverage of cancer care in five countries, 2015. Country
Is the whole population covered?
What care is covered?
What do people have to pay at the point of use?
Are there waiting times for care?
Australia
Yes
Some user charges for drugs
There may be long waits for treatment in public sector but access in private facilities is good
Canada
Yes
Yes
UK (England)
Yes
Some user charges for oral chemotherapies for outpatients, and for drugs used in conjunction with IV chemotherapy for outpatients No user charges for cancer patients, except extra billing No user charges for cancer patients
There can be long waits for initial consultation and treatment, although these have improved in recent years
France
US
No
Publicly-financed insurance: partial coverage for all treatments. In theory access to oncology services is free in public hospitals; but not all public hospitals offer full range of services leading to patients using private hospitals, in which case publicly-financed insurance pays only proportion of fee. Publicly-financed insurance: physician and inpatient hospital services covered, with the exception of some experimental therapies and some drugs used in conjunction with chemotherapy for outpatients Publicly-financed insurance: all treatments covered Publicly-financed insurance: all treatments covered except drugs and therapies not approved by NICE Publicly-financed insurance for low-income groups and older people: Medicaid and Medicare cover a limited set of procedures; privately-financed insurance covers most elements
unable to find consistent data across the five countries on oncology activity. We have based US prices on the Medicare Physician Fee Schedule. This provides fees for more than 10,000 physician services. Although there are many private insurance schemes available in the US, around 80% of physicians participate in the Medicare programme. Moreover, Medicare, Medicaid and the Children’s Health Insurance Programme (CHIP) together account for 36% of total US health care expenditure. In adopting this approach we mirror that of the Dartmouth Atlas of Health Care [6], which provides the most comprehensive basis for comparisons of expenditure across the US. Unlike Laugesen and Glied [2] who used public and private sector pricing data, we extrapolated our findings from the data most readily available, namely public payments. We address differences between private and public sectors where possible. Researchers at Dartmouth [7] have acknowledged that information on prices paid in private insurance markets in the US is relatively scarce. A recent paper has shown how prices paid under private insurance schemes vary enormously, by as much as twelvefold in the case of relatively homogeneous procedures such as lower-limb MRI. Moreover, hospital procedure prices in the private insurance market can be as much as 2–3 times more than Medicare prices in the same geographic area, for what is ostensibly the same procedure [8]. Fees for oncology consultation and chemotherapy in Australia are based on calculations using Independent Hospital Pricing Authority figures for 2015, deflated to 2011 using a 3% NEPA deflator. Fees for ultrasound and CT scans are based on the same source [9]. Fees in the Canadian province of Ontario are based on the Ontario Schedule of Benefits [10]. The prices for an oncology outpatient appointment and for an ultrasound in France are based on figures supplied in a private communciation [11]. The price for a CT scan in France reflects the fee for a CT scan for various locations (abdomen, head, pelvis) based on a blend of public and private data [12]. For the UK the figures for oncology are based on reported national average reference costs for 2010/11; for radiology they are based on an average of procedures at one area of the body weighted by the number of procedures [13]. The prices provided for the US are based on the 2014 Medicare schedule of prices [14,15]. All prices have been rebased to 2011 US$ PPP. The source for CT scans is the OECD health database 2014 [16] with the exception of Canada. The Canadian figure is for Ontario
User charges can apply to all elements of care
Patients do not wait for treatment. Short waits for treatment; individual targets have been set for cancer care Waiting times vary by region.
in 2011 [17]. Activity figures for ultrasound come from a variety of sources that are described in the on-line appendix. We provide figures on workforce as well as earnings in Table 6 below. The figure for the density of oncologists in Australia is based on an Australian oncology workforce survey 2009: it refers just to medical oncologists [18]. The figure for the density of radiologists is based on research by Nakajima et al. [19]. The figure for the density of oncologists and radiologists in Ontario is based on 2010 data [20]. The figure for the density of oncologists in France (for 2013) is based on Métiers de la cancérologie – Oncologues médicaux [21], and that for radiation oncologists is based on Métiers de la cancérologie – Radiothérapeutes [22]. The figure for the density of radiologists is based on data from Chambaud et al. [23]. The figure for the density of oncologists in the UK is based on a Faculty of Clinical Oncology Survey in 2011 and includes consultant medical oncologists and clinical oncologists [24]; similarly, that for the density of radiologists is based on a Faculty of Clinical Radiology Survey in 2011 [25]. Finally, the figures for the density of oncologists and radiologists in the US are based on data provided by the American Society of Clinical Oncology [3]. The figures for radiology and oncology earnings in Australia are estimates based on staff specialist remuneration levels in New South Wales in 2015 [26], adjusted to 2011 using an Australian National Statistics deflator. Earnings in Ontario are an average in 2010 adjusted for overhead costs [27]. Earnings in France are based on data from Chambaud et al. [22]. For oncologists, earnings in the UK are an average for clinical oncologists and medical oncologists in 2004, and include public and private earnings; for radiologists, earnings are an average in 2004, and also include public and private earnings [28]. For oncologists, earnings in the US are based on data supplied in a personal communication [29] for haematology and oncology, and are an average based on all practice types and all regions. For radiologists the source of the data is the same; earnings are a weighted average of the average earnings for invasive and non-invasive radiologists. For all countries, earnings are expressed in US$ PPP rebased to 2011. 2.2. Our approach Physician remuneration can be estimated in different ways. Total expenditure on physicians is a function of the number of services produced and the cost paid per service plus any fixed ele-
Table 2 Describing the cancer care system in 5 countries. Australia
Canada (Ontario)
France
UK (England)
US
Structure of physician practice
Medical oncologists work in public sector or as private providers, or mixture. Many radiation oncologists work in hospital cancer departments or larger cancer treatment centres; they can work in public or private hospitals or private radiology practices.
Main hospital providers of cancer treatment are in ‘private non-profit’ or public sector. Medical oncologists and radiation oncologists practice in ‘private for-profit’ or ‘not-for-profit’ centres as well as public sector. Physicians may be self-employed or salaried.
Up to 60% of all specialists do mix of publicly and privately financed work; medical oncologists obtain over 40% of income from private work (over 30% for clinical radiologists); no limits on how much specialists in public hospital can earn from private work.
Physicians can practice in academic setting, quasi-academic/private or private practice only which can range from solo practitioners, small single specialty groups or larger multi-specialty groups.
Structure of physician payments
Physicians may be salaried employees of public hospitals, self-employed suppliers, or mixture. Can charge private patients on FFS basis (fees agreed between patient and specialist). Pay for salaried specialists in public hospitals is determined by negotiation between states and territories, & various unions, usually on salaried basis although can be fee per session. Medical oncology is sub-specialty of internal medicine devoted to investigation, diagnosis and management of people with cancer. Medical oncologists are usually main health care provider for people with cancer. Radiologists work with other doctors and specialists to treat patients by assisting in diagnosis and providing treatment using medical imaging. To become specialist medical oncologist or radiologist usually takes 13 years. Annual medical school cost was capped at AUD$9792 up until 2014 although this may change with removal of some government subsidy.
All oncologists work in publicly administered and funded health care system. Most are self-employed and bill public system as independent contractors. Most work in hospital but some have own business/clinic. There is no private sector for oncology services. Most oncologists either FFS or on blended Alternative Payment Plan (APP) (base payment plus incentives and sometimes FFS). There is no private financing of oncology services.
Mixture of FFS (self-employed), salary (hospitals) and P4P. Self-employed physicians are paid FFS directly by patients usually reimbursed through statutory health insurance system. Salaried specialists who work in public hospitals are state employees.
Oncologists and radiologists work in public sector on salary basis: and in private sector usually on FFS basis.
Mixture of payment systems for oncologists: most medical oncologists paid on FFS basis; radiation oncologists often salaried hospital employees. Physicians can charge above public fee schedule when treating privately-financed patients.
Oncology consists of: medical oncology, radiation oncology, diagnostic radiology, and nuclear medicine. Some oncologists specialise in certain areas of the body.
Medical oncology, radiation oncology, onco-haematology and haematology are separate specialties. Medical oncologists ensure quality of care and multidisciplinary nature of treatment, and coordinate home-based chemotherapy as well as direct hospital admission when required.
Cancer care specialists are clinical oncologists, medical oncologists, clinical radiologists, and specialists in nuclear medicine. Medical oncologists are trained in management of cancer. Clinical radiologists use imaging tests to diagnose problems and decide on best way to manage. In some cases, radiologists use minimally invasive methods to treat diseases.
Oncology specialists broadly categorised as medical, surgical & radiation oncologists with further sub-specialisations within each. Medical oncologists act as coordinators of patient’s care with specific role in design of appropriate chemo-therapeutic plan and supportive care plan.
Training requirements are mostly same for all specialists. Average length of post-secondary education to become oncology specialist is 15–16 years. Annual medical school cost is around CAD$18,000. Postgrad. residents are paid salary by government based on seniority.
Medical training for oncology and radiology takes up to 11 years with optional extra year for research. Annual tuition fee for 2014–2015 was D 189.10 for undergraduates, D 261.10 for postgrads, & D 396.10 for PhD students.
Medical training for oncology and radiology takes from 12 to 15 years. For 2015 entry, there was maximum fee in England of £9000 per year. Doctors undertaking Foundation Training and specialist training do not pay fees but are paid a salary as NHS employees.
Physicians spend at least 13 years in training before becoming specialist. Tuition fees in public medical schools are much cheaper than private ones. In 2014 median annual tuition fees were $52,456 at private schools and $32,993 at public ones.
Structure of clinical roles
Training and research
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ment payment or incentive payment that physicians may receive, summed across all physicians. Average physician remuneration is derived by dividing total expenditure by the total number of physicians. Usually physicians produce a wide range of services and so taking a bottom-up approach to the calculation of total expenditure may result in quite complicated workings. An alternative approach is to consider income per hour of labour expended, thus taking account of the fact that inter-country comparisons may be picking up different levels of effort, as indeed may comparisons between individual physicians within one country, or regions within one country. While this may better reflect what we are trying to measure, in practice it is even harder to do. As stated earlier, physician earnings depend on a number of factors. Put simply, an individual physician’s earnings net of outgoing payments equals income from various sources, which may be both fixed and variable, less the cost of providing those services. We make a number of assumptions about these factors. First, we assume that individuals are concerned with earnings net of tax due as a result of their work activities; that an individual’s willingness to work may be influenced by the level of pension payments they must make and the level of pension to which this gives an entitlement; and finally, the cost of training and education to perform their tasks as a physician. Second, we assume that physician fees in each country will be affected by the effective demand for services and the supply of physicians, and that service utilisation and number of physicians per head give some indication of the size of these opposing forces.
3. Results Tables 3 and 4 present information, by country, on GDP, health care spending, the number of practising doctors, demographic characteristics and cancer incidence and mortality. The US has the highest GDP per capita and spends the most on health care overall, both per person and as a share of GDP. The UK spends the least on health care per person and Australia the least in terms of share of GDP. There are major differences between countries in the source of this expenditure. Although the US spends, as a proportion of total, the least publicly (47.6%) and the UK spends most publicly (84%), the US still manages to spend more publicly than the UK, both in absolute terms ($4163 per person to $2763) and as a share of GDP (8.04% to 7.81%). Higher spending on health care in the US is not reflected in greater staffing levels. In fact, the US has fewer practising doctors per 1000 population (2.46) than any of the other countries; Australia has the most (3.31). The age composition of a country will have an impact on its overall expenditure on health care. The US has the youngest age structure, with the lowest share of people aged over 65 years and the highest share of people aged under 15 years. The UK and France have an older population profile than the other countries, with 17% and 17.5% of the population at least 65 years old respectively. Canada has the smallest proportion of young people at 16.2%. Life expectancy at birth is highest in Australia and France, and considerably lower in the US than in any of the other five countries. In 2012, France (325), Australia (323) and the US (318) reported the highest incidence of cancer per 100,000 population and the UK (273) the lowest. Survival rates, however, reverse this position. The US has the lowest age-standardised mortality rate (194) from cancer per 100,000 population, while the UK has the highest rate (226). For a specific cancer – colorectal – the 5-year survival rate is highest in Australia (66.2%) and the US (64.7%) and lowest in the UK (53.25%).
3.1. Differences in utilisation rates It was not possible to find consistent data across all five countries on the use of oncology services. Table 5 presents data on CT scans and ultrasound. The data on the use of CT scans show the lowest rates are in Canada (79) and England (76) and a significantly greater rate of use in the US (257) – equal to over 1 in 4 people having a scan in a year (ignoring the possibility that some people will have multiple scans). Data on utilisation of ultrasound come from multiple sources. The US (225) also has very high rates of use of ultrasound, second only to Australia (278). 3.2. Differences in fee levels Table 5 also shows how the fee paid by public payers for a first consultation with a specialist in oncology varies threefold across countries. It is greatest in Australia (almost twice the US rate) and lowest in France (61% of the US rate). The variation is even greater (more than fourfold) for chemotherapy, with the highest fee in England (more than twice the US rate) and the lowest fee in Canada (just 47% of the US rate). Looking at public payer fees for ultrasound and CT scans, Table 5 shows the variation across countries is also three to fourfold. The US has the highest fee for ultrasound by some margin, and the highest fee for a CT scan (followed closely by France). Canada has the lowest fees in both cases. We know there are some differences in the coverage of fees, as outlined in the online Appendix. However, the fees for the US, Canada, Australia and the UK should be comparable since they are the equivalent of public costs (Medicare, public insurance schemes or the NHS). The private fee is much higher than the public fee in the US and in Canadian provinces that have some private diagnostic radiology. The data available for France are a blend of private and public fees and therefore French fees are likely to be higher than the public fee alone. Radiology fees are generally higher in the US than elsewhere, but this is not the case for oncology. This may be due to differences in procedure definitions between countries, although these are not apparent (in the online appendix we discuss how we matched complexity of ultrasound and CT scans across countries). We go on to examine in Table 6 whether these differences in fees are reflected in the earnings of specialists. 3.3. Differences in physician density Table 6 also provides information on physician capacity in terms of the number of active oncologists and radiologists in each country which we have hypothesized may have a bearing on earnings. There is considerable variation between countries in the number of oncologists per head of population. Thus, the US (0.53 per 10,000 population) and Canada (0.48) have more than three times as many oncologists as England (0.15) and over twice as many as France (0.24) and Australia (0.21). There is less but still significant variation in the density of radiologists. England has the lowest density for both specialties. 3.4. The cost of training and education Laugesen and Glied [2] argued that differences in physician income may partially reflect differences in the cost and length of time spent on physician training. Within each country there is some variation in how long medical students spend in training depending on their final specialisation, and also some inter-country differences (see Table 2 for more detailed discussion); from 11 years in France, to 11–13 years in Australia, 12–15 in the UK, 12–16 in the US and 15–16 in Canada.
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Table 3 GDP, health care spending and physician supply in five countries, 2012. Spending on health care Country
GDP per capita (US$ PPP)
Total spending per capita (US$ PPP current)
Total spending as% GDP
Public % of total
Private % of total
Practising doctors (headcount) per 1000 population
Australia Canada France UK US
44 201 40 449 35 395 36 158 48 113
3997 4602 4288 3289 8745
9.1% 10.9% 11.6% 9.3% 16.9%
68.4 70.1 77.4 84.0 47.6
31.6 29.9 22.6 16.0 52.4
3.31 2.48 3.08 2.75 2.46
Source: OECD health data 2014. Highest and lowest in each column in bold. Spending data for Australia are for 2011. Practising doctors for US is 2011.
Table 4 Demographic characteristics, cancer incidence and mortality in five countries, 2012. Country
% aged ≥65
% aged
