Why do doctors charge so high?

Doctors working in the United States have relatively low return on investment considering the costs of getting to where they are and the fact that being a doctor doesn’t scale. Doctors primarily only get paid what they earn for their time.

To be a doctor in the U.S. requires a college degree. That is 4–5 years at a cost of $40–60K a year for education, room and board. Very few Americans live at home for college.

Many premed students then take 1–2 gap years to burnish their resumes. That includes doing good deeds by volunteering to starting various non-profits, working in labs to assist researchers, or just working to bring down debt. I don’t know of very many medical students who haven’t done research. A recent entering class for medical school at UCLA had an average age of 26.

What about the cost of medical school? Another 4 years of debt at $50–70K a year including room and board. Some students take 5 years.

Then you’re a doctor and can go work right? Wrong. Everyone does a residency that goes for a minimum of 3 years to 10 plus years depending on additional subspecialty training fellowships.

So we’ve got doctors finishing training in their mid 30’s. Want to start practice? Okay, rent an office, hire staff, purchase medical malpractice insurance, purchase health insurance for your employees, purchase medical equipment and supplies, buy workers compensation insurance, pay business taxes to city and state, pay federal and state taxes on earnings.

On top of that, start paying back 8–9 years of student loans.

How about career longevity? Most doctors work to 65–70. Retirement must be funded. Some doctors opt for academic or Kaiser type jobs because they do get a pension and salaries are now competitive.

Anyone that wants to be a doctor in the U.S. for income needs a brain MRI first (sarcasm, not a professional opinion). Being a doctor is no longer the way to big income relative to all the other things that someone capable of being a doctor could otherwise be doing.

I don’t know how tongue-in-cheek this is but here’s an analysis comparing hourly lifetime salaries to that of a school teacher. The Deceptive Salary of Doctors

Per hours work, here’s another analysis comparing hourly wages of doctors and UPS drivers. If doctors wanted to be wealthy, they would have become UPS truck drivers

My point is not to disparage either teachers or UPS drivers but to illustrate that doctors salaries require many many extra hours of education and work relative to other jobs. There is certainly prestige in being a doctor. As for income, a lot of smart young college grads are going in different directions and doing very well economically for themselves.

In the U.S. there are very good reasons that doctors charge what they charge and many of them don’t consider it adequate compensation for their time and effort. That is why we’re seeing the growth of concierge practices in urban areas like Los Angeles, San Franciso, Chicago and Manhattan where fees are being requested just for access to appointments and phone calls.