Doctors in the United States charge more than twice as much as Canadian physicians for the same work, and this helps explain why this country's health care costs are dramatically higher, a study concludes.
The study found that despite their fatter fees, U.S. doctors earn only about a third more than Canadians. The reason: Canadian doctors are busier and make up for their lower fees by seeing more patients.Unlike the United States, Canada provides complete, fully paid health coverage for all its citizens. In the United States, one in seven people has no health insurance, and even those with coverage typically have to pay at least part of the bill. Despite these differences, health care costs 20 percent more per person in the United States than in Canada.
In an attempt to help sort out the reasons, economist Victor R. Fuchs of Stanford University compared the differences in the cost of physician services in the two countries.``If physician fees in the United States were the same as in Canada, by how much would total health care expenditures be reduced?' Fuchs said. ``If the fees were cut in half and lowered to the Canadian level, total expenditures would be reduced by about 10 percent.'
Overall, physician fees are 2.4 times higher in the United States than in Canada. Other factors besides doctors' earnings contribute to the lower cost of medical care in Canada.
Health care now accounts for about 11.5 percent of the gross national product in the United States, while in Canada it is about 9 percent. If U.S. spending could be held to the Canadian percentage, more than $100 billion a year would be saved.
Fuchs' calculations, which converted Canadian figures into U.S. dollars, were published in today's issue of the New England Journal of Medicine. Among the findings:
Doctors provided fewer services per person in the United States than in Canada.
U.S. fees for surgery and other high-tech services, such as X-rays and anesthesia, were more than three times higher.
On a per capita basis, Canada had more doctors but fewer specialists than the United States.
In 1985, net income for office-based doctors was $112,199 in the United States and $73,607 in Canada.
U.S. doctors are paid five times more than Canadians for visiting patients in a hospital.
U.S. doctors spend twice as much as Canadians for rent and other office expenses and generally have nicer offices, probably to help attract patients. Billing costs are also higher in the United States because Canadian doctors deal with only one insurer, the government.
Canadian fees are uniform for each service within provinces and are set through negotiations between doctors and the government.
Fuchs said he doubts whether the Canadian system could be administered in the United States.
``There is reason to question whether the quality of our civil services is up to the quality of the Canadian civil services,' he said. ``There is also reason to question whether the organization and degree of discipline in the profession is as strong as in Canada. We are very much individualists, and that includes physicians.'
The study was based on 1985 data. U.S. physician pay continues to climb sharply.
A survey by Medical Economics magazine found that U.S. physician incomes rose 12.5 percent in 1989, almost triple the rate of inflation.