Physician Salaries in 1970s and 80s

[Sam212]

This topic has come up here on this forum a lot. 70s and 80s are often referred to as the golden era of medicine. Here’s an article by CMS from the 80s that discusses the salaries at the time.

https://www.cms.gov/Research-Statis...areFinancingReview/Downloads/CMS1191016dl.pdf

Seems like salaries have increased and have kept up with inflation, if not surpassed, at least according to this article.

Here’s a Merrit Hawkins report from 2017 on current salaries, which is pretty accurate and very much in line with MGMA survey, used by most hospitals/groups.
https://www.merritthawkins.com/uplo...hysician_Incentive_Review_Merritt_Hawkins.pdf


Here’s an inflation calculator for adjusted value by BLS.
https://data.bls.gov/cgi-bin/cpicalc.pl

---

Members don't see this ad.

 

[MedicineZ0Z]

Some doctors did very well but for the most part.. don't believe the hype. Incomes are high right now (as they should be).

 

[DubbiDoctor]

You're comparing government data to Merritt Hawkins data, which is highly misleading. The latest BLS data indicates that family and gen practitioners made 208K on average in 2017, compared to, adjusted for inflation, $263,485.00 for gen practice doctors in 1973 in the data you cited; internists, in 1973, adjusted for inflation, made $317,005.38, compared to 198,370$ in 2017, according to BLS. General surgeons made $360,527.46 in 1973, compared to 252k in 2017 according to BLS gov data. If you used data from physician recruitment agencies in 1973, it would most likely show far higher salaries. Not to mention, physicians in 1973 had to incur far less debt to get to where they were - and commanded far more respect.

Family and General Practitioners
Surgeons
Internists, General

 

[Sam212]

You're comparing government data to Merritt Hawkins data, which is highly misleading. The latest BLS data indicates that family and gen practitioners made 208K on average in 2017, compared to, adjusted for inflation, $263,485.00 for gen practice doctors in 1973 in the data you cited; internists, in 1973, adjusted for inflation, made $317,005.38, compared to 198,370$ in 2017, according to BLS. General surgeons made $360,527.46 in 1973, compared to 252k in 2017 according to BLS gov data. If you used data from physician recruitment agencies in 1973, it would most likely show far higher salaries. Not to mention, physicians in 1973 had to incur far less debt to get to where they were - and commanded far more respect.

Family and General Practitioners
Surgeons
Internists, General

We don't have any Merritt Hawkins or any other survey from 1984 to give us the exact numbers to compare, we do have the data presented by CMS in the above mentioned article. If you read the methods, it' s a survey, not numbers from BLS, although it probably does underestimate salary somewhat. Also, the data is from 1975, not 1973. There was massive inflation between '73 and '75 apparently, as adjusted salary for '75 numbers come to $259,202 and $294,788 for internists and surgeons respectively. If you have any other data that refutes what I have presented, I would be interested in seeing that to compare.

BLS website itself is misleading as they don't tell you how they collected their data, except that they are "estimates". Here's another link from BLS that quotes salaries that are more in line with what you will see in real life.

Physicians and Surgeons : Occupational Outlook Handbook: : U.S. Bureau of Labor Statistics.

While I agree with you on rising cost of medical education, and consequently increased debt burden, physician salaries have kept up with inflation. Physicians are paid pretty well and very much in line with their predecessors, on average. If you show me an old timer who made millions, I'll point you to a busy ortho/ophtho who makes millions in private practice now. These are outliers.

 

[BidingMyTime]

This topic has come up here on this forum a lot. 70s and 80s are often referred to as the golden era of medicine. Here’s an article by CMS from the 80s that discusses the salaries at the time.
https://www.cms.gov/Research-Statis...areFinancingReview/Downloads/CMS1191016dl.pdf
Seems like salaries have increased and have kept up with inflation, if not surpassed, at least according to this article.

Because there is more to what makes a golden career era then salary alone. Doctors in the 70's/80's were mostly self-employed, masters of their own destiny--where as now, many/most are employees for a health care system. Doctors in the 70's/80's also had far less insurance issues to deal with, patients rarely, if ever, needed PA's for procedures and medicine, billing was far simpler, patients could go to any doctor of their choice and have it covered on their insurance (at least until HMO's took hold in the mid 80's), patients were less likely to sue, nor did they have to worry about the non-patient record-keeping requirements now required to keep the government happy.

 

[Perrotfish]

We don't have any Merritt Hawkins or any other survey from 1984 to give us the exact numbers to compare, we do have the data presented by CMS in the above mentioned article. If you read the methods, it' s a survey, not numbers from BLS, although it probably does underestimate salary somewhat. Also, the data is from 1975, not 1973. There was massive inflation between '73 and '75 apparently, as adjusted salary for '75 numbers come to $259,202 and $294,788 for internists and surgeons respectively. If you have any other data that refutes what I have presented, I would be interested in seeing that to compare.

BLS website itself is misleading as they don't tell you how they collected their data, except that they are "estimates". Here's another link from BLS that quotes salaries that are more in line with what you will see in real life.

Physicians and Surgeons : Occupational Outlook Handbook: : U.S. Bureau of Labor Statistics.

While I agree with you on rising cost of medical education, and consequently increased debt burden, physician salaries have kept up with inflation. Physicians are paid pretty well and very much in line with their predecessors, on average. If you show me an old timer who made millions, I'll point you to a busy ortho/ophtho who makes millions in private practice now. These are outliers.

You are, basically, right. The only thing to keep in mind is that the high salaries we are experiencing are a very recent phenomenon. Physician salaries didn't exactly keep up with inflation since the 80s. Physician incomes were static (no increase with inflation) for almost two decades and then they startrd rising at 8% per year at about the start of the Obama administration. Now we are finally reaching the same inflation adjusted vales that we had in the 80s. We will see if this is the peak of a bubble, or the start of another sustained 'golden age'.

 

[Perrotfish]

Not to mention, physicians in 1973 had to incur far less debt to get to where they were

They also paid far, far higher taxes. Through the 70s the top tax bracket, which most physicians would have been in, was 70%. That's just federal taxes.

Because there is more to what makes a golden career era then salary alone. Doctors in the 70's/80's were mostly self-employed, masters of their own destiny--where as now, many/most are employees for a health care system. Doctors in the 70's/80's also had far less insurance issues to deal with, patients rarely, if ever, needed PA's for procedures and medicine, billing was far simpler, patients could go to any doctor of their choice and have it covered on their insurance (at least until HMO's took hold in the mid 80's), patients were less likely to sue, nor did they have to worry about the non-patient record-keeping requirements now required to keep the government happy.

There have been ups and downs. In the 70s physicians had far more autonomy, spent less time writing records for billing, and malpractice law was less extreme. On the other hand they were much more likely to take call. As in home call, where someone is waking you up in the middle of the night after a full day of work call. That's pretty rare these days. You can decide which is worse.

 

[VA Hopeful Dr]

They also paid far, far higher taxes. Through the 70s the top tax bracket, which most physicians would have been in, was 70%. That's just federal taxes.


There have been ups and downs. In the 70s physicians had far more autonomy, spent less time writing records for billing, and malpractice law was less extreme. On the other hand they were much more likely to take call. As in home call, where someone is waking you up in the middle of the night after a full day of work call. That's pretty rare these days. You can decide which is worse.

I think that second part is very important. I suspect on an hourly basis, we're making more now than then. I'm happy to take a decent pay cut in exchange for home phone call twice a month and never setting foot in the hospital.

 

[Sam212]

You are, basically, right. The only thing to keep in mind is that the high salaries we are experiencing are a very recent phenomenon. Physician salaries didn't exactly keep up with inflation since the 80s. Physician incomes were static (no increase with inflation) for almost two decades and then they startrd rising at 8% per year at about the start of the Obama administration. Now we are finally reaching the same inflation adjusted vales that we had in the 80s. We will see if this is the peak of a bubble, or the start of another sustained 'golden age'.

I don’t think a golden age is possible without addressing two issues:

1) alarming rate of increase in cost of medical education
2) even more alarming increase in new medical schools, both osteopathic and allopathic.

If we don’t address these issues, we may find ourselves in a similar situation as lawyers did about 10 years ago. Old timers that are incharge are shortsighted and pimping future generations of physicians out.

 

[colbgw02]

I think that second part is very important. I suspect on an hourly basis, we're making more now than then. I'm happy to take a decent pay cut in exchange for home phone call twice a month and never setting foot in the hospital.

I'd be interested to know how those hours stack up though. In other words, how much harder, if at all, are physicians working now as compared to 30 years ago? I know my specialty isn't even recognizable to people who trained or practiced in the 80s.

 

[Perrotfish]

I don’t think a golden age is possible without addressing two issues:

1) alarming rate of increase in cost of medical education
2) even more alarming increase in new medical schools, both osteopathic and allopathic.

If we don’t address these issues, we may find ourselves in a similar situation as lawyers did about 10 years ago. Old timers that are incharge are shortsighted and pimping future generations of physicians out.

For the debt you can run the numbers. If you're on a 10 year repayment plan you would need a debt well above the COA for a private medical school, at 7% interest, just to break even with a 70s physician with no debt, the same inflation adjusted salary, and a 70% top marginal tax bracket.
.

 

[VA Hopeful Dr]

I'd be interested to know how those hours stack up though. In other words, how much harder, if at all, are physicians working now as compared to 30 years ago? I know my specialty isn't even recognizable to people who trained or practiced in the 80s.

Well I know that 30 years ago, family doctors rounded on inpatients, delivered babies, and saw their own patients in the ED. So I don't know for sure what their overall hours are, but there is no way those hours are less than mine are now. So I suspect FM, IM, and peds are better off now than they were if for no other reason than the advent of the hospitalist and the wide spread use of EM.

I know that generally speaking, more doctors were either solo practice or in small groups compared to today. So going from q2 to q6 is an improvement if nothing else.

 

[MedicineZ0Z]

They also paid far, far higher taxes. Through the 70s the top tax bracket, which most physicians would have been in, was 70%. That's just federal taxes.


There have been ups and downs. In the 70s physicians had far more autonomy, spent less time writing records for billing, and malpractice law was less extreme. On the other hand they were much more likely to take call. As in home call, where someone is waking you up in the middle of the night after a full day of work call. That's pretty rare these days. You can decide which is worse.

If they were incorporated, why would they pay that much tax?

 

[BidingMyTime]

If they were incorporated, why would they pay that much tax?

Because even if you are incorporated, you still have to pay yourself a salary, and then you have to pay income tax on the salary.

 

[iqe2010]

My grandmother was a nurse back in the 60s. Back then nurses had to calculate and measure out certain dosages.

I wonder how many people died because a nurse couldn't count.

 

[anbuitachi]

Some doctors did very well but for the most part.. don't believe the hype. Incomes are high right now (as they should be).

its all relative. incomes are low compared to a couple decades ago, but still high compared to cashiers

 

[Postictal Raiden]

I found this study that contains data collected from MGMA regarding physicians' salary in 1998. 20 years later, things have remained the same (inflation-adjusted).

https://pdfs.semanticscholar.org/4d3d/e0a2512f2c09b4d91dea02640edbf2f7e3b8.pdf

 

[MedicineZ0Z]

Because even if you are incorporated, you still have to pay yourself a salary, and then you have to pay income tax on the salary.

You pay yourself in dividends and list family members as shareholders who you then also pay with dividends --> and they gift the money back to you.
In North America, incorporating ultimately means you pay less net tax than if you were on a salary.

 

[shouldvestudied]

You pay yourself in dividends and list family members as shareholders who you then also pay with dividends --> and they gift the money back to you.
In North America, incorporating ultimately means you pay less net tax than if you were on a salary.

I am pretty sure that is tax fraud.

You cannot pay yourself only in dividends if you're doing the work of a doctor within the practice that you own. The IRS will expect you to be paid a salary commensurate with that of other doctors in the practice or market rate if you're the sole provider.

 

[MedicineZ0Z]

I am pretty sure that is tax fraud.

You cannot pay yourself only in dividends if you're doing the work of a doctor within the practice that you own. The IRS will expect you to be paid a salary commensurate with that of other doctors in the practice or market rate if you're the sole provider.

Source?

 

[shouldvestudied]

Source?

The "Reasonable Compensation" heading here: Paying Yourself | Internal Revenue Service

The Internal Revenue Service may determine that adjustments must be made to the income and expenses of tax returns for both the corporation and an individual shareholder if the officer is substantially underpaid for services provided.

 

[MedicineZ0Z]

The "Reasonable Compensation" heading here: Paying Yourself | Internal Revenue Service

You're not required to pay a set market wage for your work. It's not like you're paying yourself 60k/yr which is what violates the reasonable compensation test.

 

[anbuitachi]

I'd be interested to know how those hours stack up though. In other words, how much harder, if at all, are physicians working now as compared to 30 years ago? I know my specialty isn't even recognizable to people who trained or practiced in the 80s.

Well I know that 30 years ago, family doctors rounded on inpatients, delivered babies, and saw their own patients in the ED. So I don't know for sure what their overall hours are, but there is no way those hours are less than mine are now. So I suspect FM, IM, and peds are better off now than they were if for no other reason than the advent of the hospitalist and the wide spread use of EM.

I know that generally speaking, more doctors were either solo practice or in small groups compared to today. So going from q2 to q6 is an improvement if nothing else.

There were a few articles about when they implemented work hours for residents. One of the things they mentioned was that it doesn't really help with stress because it means they had to accomplish more work in less time. Either that or they lie on their forms about their hours. So it's definitely a complicated discussion but I too am curious if anyone has those numbers

 

[anbuitachi]

This topic has come up here on this forum a lot. 70s and 80s are often referred to as the golden era of medicine. Here’s an article by CMS from the 80s that discusses the salaries at the time.

https://www.cms.gov/Research-Statis...areFinancingReview/Downloads/CMS1191016dl.pdf

Seems like salaries have increased and have kept up with inflation, if not surpassed, at least according to this article.

Here’s a Merrit Hawkins report from 2017 on current salaries, which is pretty accurate and very much in line with MGMA survey, used by most hospitals/groups.
https://www.merritthawkins.com/uplo...hysician_Incentive_Review_Merritt_Hawkins.pdf


Here’s an inflation calculator for adjusted value by BLS.
https://data.bls.gov/cgi-bin/cpicalc.pl

I'm curious about the RVU generated during that time per doctor. One thing doctors often do when salaries fall is work more to keep their salaries the same. Because once youve budgeted your salary you don't want to let it fall mid career and that's something these pure salary surveys won't show you. One example is the anesthesiologist making 300-400k 10 years ago doing 1 room, own cases, and now making 300-400k covering 4 CRNA rooms to be able to generate the same income due to lower reimbursements. On paper, the salaries are the same, but in reality, they are now running around like chickens at work

 

[VA Hopeful Dr]

There were a few articles about when they implemented work hours for residents. One of the things they mentioned was that it doesn't really help with stress because it means they had to accomplish more work in less time. Either that or they lie on their forms about their hours. So it's definitely a complicated discussion but I too am curious if anyone has those numbers

It's not scientific, but growing up I had an uncle who was a family doctor. I never saw him despite living 3 blocks away. When his hospital started having hospitalists all of a sudden he was around on weekends, holidays, and evenings.

Interestingly, when his hospital started using an EMR his patient volume went down 30% but income stayed the same due to better coding.

 

[Postictal Raiden]

It's not scientific, but growing up I had an uncle who was a family doctor. I never saw him despite living 3 blocks away. When his hospital started having hospitalists all of a sudden he was around on weekends, holidays, and evenings.

Interestingly, when his hospital started using an EMR his patient volume went down 30% but income stayed the same due to better coding.

Did your uncle earn significantly higher back in the "golden era" compared to what FM docs earn today (like you)?

 

[VA Hopeful Dr]

Did your uncle earn significantly higher back in the "golden era" compared to what FM docs earn today (like you)?

I've not asked, not really polite to do so.

 

[Sam212]

I'm curious about the RVU generated during that time per doctor. One thing doctors often do when salaries fall is work more to keep their salaries the same. Because once youve budgeted your salary you don't want to let it fall mid career and that's something these pure salary surveys won't show you. One example is the anesthesiologist making 300-400k 10 years ago doing 1 room, own cases, and now making 300-400k covering 4 CRNA rooms to be able to generate the same income due to lower reimbursements. On paper, the salaries are the same, but in reality, they are now running around like chickens at work

I think there’s some truth to this, but physicians are also more efficient now with all the technological advances.

Take ortho for example, a knee/hip replacement used to pay $3-4K about 30 years ago. Now, you’d be lucky to get more than $1500. However, knee/hip replacement was a rather big undertaking back in the day. With tech advances, you can literally do a TKA in 30 minutes, and 40 mins for THA - if you’re good and efficient. It’s not hard to see guys doing 500-800 joint replacements a year nowadays, whereas, the busiest guys did about 200-300 back 25 to 30 years ago.

As a result, work hours have stayed relatively stable over the years, if not improved, at least for orthopedics.

 

[redfish955]

The national average for an entry level engineer in 1975 earned 60k and a senior engineer earned 100k.

 

[shouldvestudied]

The national average for an entry level engineer in 1975 earned 60k and a senior engineer earned 100k.

In 2015 dollars.

 

[nimbus]

We don't have any Merritt Hawkins or any other survey from 1984 to give us the exact numbers to compare, we do have the data presented by CMS in the above mentioned article. If you read the methods, it' s a survey, not numbers from BLS, although it probably does underestimate salary somewhat. Also, the data is from 1975, not 1973. There was massive inflation between '73 and '75 apparently, as adjusted salary for '75 numbers come to $259,202 and $294,788 for internists and surgeons respectively. If you have any other data that refutes what I have presented, I would be interested in seeing that to compare.

BLS website itself is misleading as they don't tell you how they collected their data, except that they are "estimates". Here's another link from BLS that quotes salaries that are more in line with what you will see in real life.

Physicians and Surgeons : Occupational Outlook Handbook: : U.S. Bureau of Labor Statistics.

While I agree with you on rising cost of medical education, and consequently increased debt burden, physician salaries have kept up with inflation. Physicians are paid pretty well and very much in line with their predecessors, on average. If you show me an old timer who made millions, I'll point you to a busy ortho/ophtho who makes millions in private practice now. These are outliers.

The BLS numbers are complete fiction. I work in a notoriously saturated, low pay area and I don’t know any surgeons or anesthesiologists who make 250-265. Even part timers do significantly better.

 

[RaidenXVC]

The BLS numbers are complete fiction. I work in a notoriously saturated, low pay area and I don’t know any surgeons or anesthesiologists who make 250-265. Even part timers do significantly better.

Like how much better...?

 

[nimbus]

Like how much better...?

MGMA is realistic.

 

[nimbus]

The buying power has definitely declined. When I was a teenager in the 1980s we would visit a family friend who was an anesthesiologist. He was an IMG and didn’t even speak English very well but he had a home with a pool and a tennis court on Long Island Sound in Sands Point, NY. Similar homes are now $5-10mil. No young doctors move into that neighborhood anymore. The situation is the same on the west coast where I live and work. Doctors used to be able to afford the best areas but we simply can’t afford them now.

 

[anbuitachi]

just had a patient tell me his dad was a doctor and his salary 40 years ago was higher than it is today for the specialty..

w regards to buying power, it's probably also due to outside investments. rich people from all over the world are buying up houses in popular areas
but it's crazy how expensive houses are in some cities. Talked to an attending the other day, he said his income from rent alone is few hundred thousand. There's no way a young attending can buy multiple houses. Most probably wont even be able to afford 1 decent sized house in an average neighborhood around here (about 1.3-1.5M) after working many many years

 

[DubbiDoctor]

just had a patient tell me his dad was a doctor and his salary 40 years ago was higher than it is today for the specialty..

w regards to buying power, it's probably also due to outside investments. rich people from all over the world are buying up houses in popular areas
but it's crazy how expensive houses are in some cities. Talked to an attending the other day, he said his income from rent alone is few hundred thousand. There's no way a young attending can buy multiple houses. Most probably wont even be able to afford 1 decent sized house in an average neighborhood around here (about 1.3-1.5M) after working many many years

Yeah, a lot of it is income inequality. In our age of most increases in income going to the 1% (the majority of physicians are not in the one percent) most doctors cannot afford to live in the most affluent areas anymore. Making 300k in 1970, in inflation adjusted dollars, made you a lot richer, relatively speaking, than making 300k in 2018.

 

[Postictal Raiden]

Like several posters mentioned, the key is not the drop on compensations, it's the purchasing power. For the most part, salaries have kept up with inflation. However, physicians nowadays can no longer afford the same level of affluent lifestyle they could three decades ago. This could be attributed to the emergence of other groups that make much more money that physicians. A beach house in SoCal that once was sold for price 2-3x the physician's annual salary is now worth 15x the salary.

 

[VA Hopeful Dr]

Like several posters mentioned, the key is not the drop on compensations, it's the purchasing power. For the most part, salaries have kept up with inflation. However, physicians nowadays can no longer afford the same level of affluent lifestyle they could three decades ago. This could be attributed to the emergence of other groups that make much more money that physicians. A beach house in SoCal that once was sold for price 2-3x the physician's annual salary is now worth 15x the salary.

I think that's the most likely explanation as outside of the super high COL areas, physicians are usually still the once who make the most money.