Monday, February 14, 2011

The Growing Gender MD Pay Gap CAN Be Explained

Here's the abstract of the paper "The $16,819 Pay Gap For Newly Trained Physicians: The Unexplained Trend Of Men Earning More Than Women" in Health Affairs (Feb. 14, 2011): 
"Prior research has suggested that gender differences in physicians’ salaries can be accounted for by the tendency of women to enter primary care fields and work fewer hours. However, in examining starting salaries by gender of physicians leaving residency programs in New York State during 1999–2008, we found a significant gender gap that cannot be explained by specialty choice, practice setting, work hours, or other characteristics. The unexplained trend toward diverging salaries appears to be a recent development that is growing over time. In 2008, male physicians newly trained in New York State made on average $16,819 more than newly trained female physicians, compared to a $3,600 difference in 1999."
What's causing the growing pay gap?  The authors don't think it's driven by increasing gender discrimination and conclude that:
"It would be difficult to believe that discrimination, after a period of quiescence, has actually been on the rise in recent years. Moreover, our results indicate a trend toward diverging salaries not only in the traditionally male-dominated sub-specialty fields, which experienced an influx of women in our sample, but also in primary care fields."
Despite the title of the paper, the authors actually provide some very plausible explanations for the growing pay gap for MDs:
"It is possible that the continued influx of women into medicine has reached a tipping point, and physician practices may now be offering greater flexibility and family-friendly attributes that are more appealing to female practitioners but that come at the price of commensurately lower pay.

Such an explanation not only is consistent with the pattern observed in the data, but it also suggests that the continued integration of women into the physician workforce is reshaping the practice and business of medicine in ways that need to be measured by variables that are more subtle and comprehensive than salary.

If true, it also implies that female physicians respond to non-monetary elements in a given job offer and are willing to accept lower salaries in return for jobs that better reflect their broader employment preferences.

Thus, instead of being penalized because of their gender, female physicians may be seeking out employment arrangements that compensate them in other—non-financial—ways, and more employers may be beginning to offer such arrangements."
MP: In other words, the trend of male MDs earning more than female MDs is pretty easily explained: female (male) physicians put a higher (lower) priority on flexibility in work hours and family-friendly attributes of their employment arrangements, and are willing to accept lower (higher) financial compensation in return for greater (lower) non-monetary compensation.  That is, it's possible that male and female physicians are not true counterparts in the labor market for MDs, and it therefore could be expected that average starting salaries would reflect the significant gender differences in workplace priorities.  


At 2/14/2011 2:53 PM, Blogger Mike said...

I've read (and agree) with most of the data/explanation of gender-based pay gaps. But I'd like to see if anyone else agrees with my theory of "victim" negotiation:
I noticed (by living with a brilliant, talented hard-working woman) that even the women who seem to understand the reasons behind pay gaps still sell their own value short because they have been told since childhood that they will not make as much money as a man....therefore, they don't negotiate as aggressively as a man for the same job.

This is purely anecdotal, so feel free to rip me up on this one, but I think there may be something to it and could very well explain a small-percentage difference.

At 2/14/2011 5:35 PM, Anonymous Anonymous said...

Few physicians in private practice receive a fixed annual salary. In group practices, most physicians are paid using a combination of base salary plus some measure of productivity such as payments received. Two group practice physicians with identical base salaries will earn different amounts per year because they see different numbers of patients per day and work different numbers of days per year.

Studies have shown that, on average, female physicians spend more time with patients than male physicians regardless of physician specialty or patient problem. Female physicians do not work longer hours than male physicians. Thus, female physicians, on average, will see fewer patients per year and will earn less.

Since money isn't the only reason why people become physicians, it is hardly surprising that some will accept lower annual earnings as a tradeoff for spending more time with their patients and/or more time at home.

I am a pathologist who liked to teach, so I took academic positions instead of higher paying private practice positions. Many female physicians also are drawn to teaching, and they comprise a disproportionately high percentage of recently hired clinical faculty.

I think Mike (above) makes some good points. I would like to add that another reason why a female physician may not negotiate as hard as a male is that women tend to compromise to avoid possible discord. If you press too hard for higher pay, you risk losing the job or getting the job but annoying some of your future coworkers.

At 2/15/2011 11:13 AM, Blogger cactusKP said...

female physicians spend more time with patients than male physicians

Shouldn't this also mean that patients who choose to spend more time with their physician must pay more than patients who elect to spend lest time speaking with their Doctor?

At 2/15/2011 4:22 PM, Blogger Ron H. said...

"Shouldn't this also mean that patients who choose to spend more time with their physician must pay more than patients who elect to spend lest time speaking with their Doctor?"

No, this just means that if you have a female doctor, you should expect to wait longer as she wastes your time chatting with the patient ahead of you.

At 2/15/2011 5:59 PM, Anonymous Anonymous said...

@Kevin Peterman: Since most patients do not directly pay for medical care, a physician who spends more time with patients rarely gets more money. Insurers, Medicaid, and Medicare reimburse based on the "level" of the visit and the specialty of the physician, not on the time spent with the patient.

@Ron H.: A physician who routinely spends more time with each patient will schedule fewer patients per hour, so there does not have to be longer waiting times. The extra time spent per patient is rarely "chatting." It is getting a more detailed medical history, doing a more thorough exam, and spending time explaining the disease process, the drug effects, the time required to recover or heal, etc.

At 2/15/2011 6:43 PM, Blogger Ron H. said...

Dr. T

My comment was somewhat facetious. I recognize the benefit of a longer visit, and appreciate it for myself, but my experience has been that doctors who are willing to spend extra time with a patient often end up running behind. Some of this results from being overbooked by optimistic office staff, and the doctor may not even know that he or she is behind. I usually mention my wait time when I think it's excessive.


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