Health Care Reform by Increasing Primary Care Physician Salaries (Yes, a Necessary Evil)

Here are some thoughts by primary care internists and pediatricians.  Individual physician names have been removed (except NEJM article author)

Fixing primary care is critical to health care reform but will require simultaneously fixing several problems, including those related to remuneration, the work environment, and medical education.1 The most critical of these issues is remuneration.

The week of June 15 to 26, 2009, was bittersweet for those of us who care about primary care. President Barack Obama addressed the American Medical Association, emphasizing the central role that primary care must play in health care reform.2

We then learned of the death of Dr. Lynn Carmichael, a founder of the modern field of family medicine.3 The roller coaster continued with the publication in the Journal of two articles about the crisis in primary care, detailing the moribund state of primary care4 and the policies proposed for resuscitating it.1

I believe that these proposed policy reforms are doomed to fail, because they ignore the impact of managed care on remuneration. Primary care was supposed to be paramount under managed care. “We need you to be gate keepers,” we were told, “and we’ll pay you well to perform that service.”

In actuality, remuneration for primary care decreased under managed care, as contracts were negotiated solely on the basis of cost. Continuity of care was disrupted, as managed care relegated primary care doctors to ambulatory settings, replaced them with nurse practitioners or physician assistants, and utilized hospitalists for inpatient care.

Worse, patient panels were dissolved and reassembled annually during open enrollment, as companies negotiated not with doctors, but with employers.

So how can we fix the problem? Why not simply mandate that all payers, public or private, pay a capitation fee or salary designed to assure that primary care doctors can achieve a professional standard of living? In exchange, primary care doctors would provide continuing, comprehensive primary care (including night call and preventive services) for a reasonably sized panel of patients.

For the sake of discussion, I would suggest a salary and fringe benefit package of about $300,000 per year (in 2009 dollars) to care for 2000 patients, ($150 per patient), with incentives for special circumstances (e.g., working in underserved communities) or special services (e.g., delivering babies). All other fees, deductibles, and copayments would be waived. The problem of physician-generated demand would be eliminated, which would radically reduce costs to insurers. Billing would disappear. Patients would have open access to their primary care physicians.

Freed from the constraints of billing for the traditional encounter, primary care doctors could employ innovative methods to deliver primary care, including the Internet and group encounters.

Arthur M. Fournier, M.D. University of Miami Leonard Miller School of Medicine Miami, FL This article (10.1056/NEJMopv0907129) was published on August 19, 2009, at

References Bodenheimer T, Grumbach K, Berenson RA. A lifeline for primary care. N Engl J Med 2009;360:2693-2696. [Free Full Text] President Barack Obama addresses the American Medical Association, Chicago, July 15, 2009. (Accessed August 13, 2009, at

 Brecher EJ. Dr. Lynn Paul Carmichael dies at 80: pioneered family medicine at UM. Miami Herald. June 23, 2009. (Accessed August 13, 2009, at

Steinbrook R. Easing the shortage in adult primary care — is it all about money? N Engl J Med 2009;360:2696-2699. [Free Full Text]

Comments by other Physicians:

The operating word here is salary. On average 50% to 60% of insurance payments and copays go towards covering the office overhead. I would be more than happy with a salary including fringe so long as the overhead of my office is covered in addition to this payment. Too often when these plans are put together small details are missed and then, what was designed to help becomes a major headache to us.  (written by a pediatrician).

 Primary Care Remuneration — A Simple Fix Date: Fri, 21 Aug 2009 11:06:24 -0400 This is very good suggestion and an alternate to a Single Payer. However something would have to be in place to assure that managed care would not be shifting patients. Obviously there would be no need for them to cherry pick. Also over all cost to the system should be easier to predict.  (written by another pediatrician).

Last updated September 7, 2009 by Dr. Vee

2 thoughts on “Health Care Reform by Increasing Primary Care Physician Salaries (Yes, a Necessary Evil)

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