Media Releases

Paying physicians more to get more — or to get less

November 30, 2011

TORONTO, ON — Labour eco­nom­ics can pro­vide a valu­able per­spec­tive in address­ing the sup­ply of doc­tors and access to care, says an arti­cle in the Decem­ber 6, 2011 issue of the Cana­di­an Med­ical Asso­ci­a­tion Jour­nal (CMAJ).

“Under­stand­ing and accu­rate­ly pre­dict­ing the response of physi­cians to incen­tives is essen­tial if gov­ern­ments wish to increase the sup­ply of physi­cian ser­vices,” says Prof. Bri­an Gold­en, who holds the San­dra Rot­man Chair in Health Sec­tor Strat­e­gy at the Uni­ver­si­ty of Toron­to’s Rot­man School of Man­age­ment, who wrote the arti­cle with Rot­man Prof. Doug Hyatt and Rose­mary Han­nam of the Rot­man School’s Cen­tre for Health Sec­tor Strat­e­gy.

Access to health care in Cana­da is a chal­lenge in many regions, and while there has been an over­sup­ply of physi­cians in the past, many peo­ple cur­rent­ly have prob­lems get­ting care. “Cen­tral to the issue of access is the ade­qua­cy of the sup­ply of physi­cians — specif­i­cal­ly, whether the num­ber of physi­cians and their work effort suf­fi­cient­ly address­es the health care needs of the pop­u­la­tion,” write the authors. “Sup­ply is appro­pri­ate­ly man­aged when there is nei­ther a short­age nor sur­plus of ser­vices.”

Provin­cial and ter­ri­to­r­i­al gov­ern­ments can help increase access to care by set­ting poli­cies that influ­ence physi­cians to increase their work­ing hours and there­by affect the sup­ply of ser­vices they pro­vide. Iron­i­cal­ly, by hav­ing such a strong impact on hours worked, the authors report that increased pay to attract more physi­cians can also have the unin­tend­ed con­se­quence of reduc­ing the hours physi­cians choose to work.

Gov­ern­ments may pro­vide non­wage com­pen­sa­tion such as recruit­ment or reten­tion bonus­es, repay­ment of tuition fees, relo­ca­tion sup­port or staffing costs. How­ev­er, non­wage rewards not linked to hours worked “also reduce the fixed costs of a prac­tice and cre­ate a pure income effect, there­by induc­ing few­er hours of work and few­er ser­vices pro­vid­ed.”

“Link­ing com­pen­sa­tion to time worked or ser­vices pro­vid­ed, as opposed to forms of pay that are unre­lat­ed to time worked, will bet­ter ensure the goal of increased work hours,” the authors con­clude. “Pol­i­cy-mak­ers should rec­og­nize that poli­cies for com­pen­sa­tion may result in just what we hope for — or just the oppo­site.”

CMAJ show­cas­es inno­v­a­tive research and ideas aimed at improv­ing health for peo­ple in Cana­da and glob­al­ly. It pub­lish­es orig­i­nal clin­i­cal research, analy­ses and reviews, news, prac­tice updates and thought-pro­vok­ing edi­to­ri­als. In 2011, the jour­nal cel­e­brates 100 years of pub­lish­ing med­ical knowl­edge in print and now online at

For the lat­est think­ing on busi­ness, man­age­ment and eco­nom­ics from the Rot­man School of Man­age­ment, vis­it

The Rot­man School of Man­age­ment at the Uni­ver­si­ty of Toron­to is redesign­ing busi­ness edu­ca­tion for the 21st cen­tu­ry with a cur­ricu­lum based on Inte­gra­tive Think­ing. Locat­ed in the world’s most diverse city, the Rot­man School fos­ters a new way to think that enables the design of cre­ative busi­ness solu­tions.  The School is cur­rent­ly rais­ing $200 mil­lion to ensure Cana­da has the world-class busi­ness school it deserves. For more infor­ma­tion, vis­it


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Rot­man School of Man­age­ment
Uni­ver­si­ty of Toron­to
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