• Sessions
• Presentations
• Posters
• Rooms

Presentation

Session: Physician Income
Room: Chydenius Rooms
Time: Thu 14:30-15:45

Presenter: Anne-Laure Samson (Université Paris Dauphine. Leda-Legos)

Abstract

In France, most general practitioners (GPs) are self-employed and paid through a fee-for-services scheme. Reference fees are fixed for each service by a bargaining between the public health insurance and medical associations. GPs’ incomes are therefore closely related to the amount of services they provide.
Our study reveals high income disparities among French GPs. While the average GP’s incomes are quite high (5000€ in 2004), they are also very dispersed. Each year between 1993 and 2004, 5 to 7% of GPs earn less than 1.5 net SMIC (the French minimum wage). The purpose of this paper is to study those low-income GPs: do they choose to work less or are they constrained to?

We use a representative panel of more than 4,000 self-employed GPs practicing in France between 1993 and 2004. It is drawn from an administrative file on self-employed physicians collected by the public health insurance. We define a sub-sample of “low-income GPs” composed of GPs who experienced incomes lower than 1.5 net SMIC at least once between 1993 and 2004.

A descriptive analysis first shows that having low incomes, even during a short period of time, has a lasting impact on GPs’ incomes over their whole career. Surprisingly, low-income GPs are not physicians who begin their activity and who could have difficulties in recruiting patients: the level of experience has no significant effect on the probability of having low incomes. Low-income GPs are mainly female but also physicians practicing in the south of France, i.e. in areas where the medical density is very high but where the quality of life is also better.

These first results lead us to test whether these low incomes result from a preference for leisure: do low-income GPs have a different optimal level of activity than all other GPs? The econometric analysis consists of measuring GPs’ reaction to an exogeneous shock of demand. We show that low-income GPs never react to an increase in demand, while it would give them the opportunity to increase their activity and their incomes. They only react to negative shocks of demand, i.e. they decrease their activity when they are constrained to. Conversely, all other GPs always react to positive and negative shocks of demand : their activity is strongly constrained by the demand they are facing.

We conclude that those low-income GPs are physicians who choose to work less : to respond to the increasing demand by increasing their activity would reduce their utility. Their low incomes do not reflect a downgrading of the GPs’ profession, but rather one of its advantages: as self-employed, GPs can freely choose their number of hours of work. They may choose to work less.

Key Terms

GPs, self-employed, labor supply, low-income physicians, longitudinal data

Authors:

Anne-Laure Samson (Université Paris Dauphine. Leda-Legos)

Search with Google