Overpaid and Under-Performing

Please, make it stop!

Once again, government has attacked doctors. This time, the federal government took a turn.

Finance Minister Morneau said doctors were using a “loophole” in the tax code, breaking the law against loopholes.

He suggested doctors were cheating and not paying their fair share.

He promised public consultation before addressing the overpaid doctors.

The provincial government gave doctors the ability to incorporate in lieu of fee increases, just over 10 years ago. Most other provinces have had the ability to incorporate for much longer.

Doctors could finally build a pension and create self-financed benefits just like other incorporated businesses and salaried workers.

But the federal government needs money.

“We still find the greedy hand of government thrusting itself into every corner and crevice of industry, and grasping at the spoil of the multitude….It watches prosperity as its prey and permits none to escape without a tribute.”

— Thomas Paine

When looking to save money, bureaucrats and politicians do the following:

They scan a budget.

They find the thing that costs the most.

Then they cut that thing.

Of course, they have options. They could close down dozens of small, failing projects.

But this approach creates political pain. It is much easier to trim 30% from one large budget item than to eliminate a dozen small ones.

It is easier to deal with outrage from one small group that lost something than to deal with dozens of groups that lost everything.

Politicians always take the path of least political resistance.

Overpaid

Cutting doctors fits well with the urban myth that doctors are loaded.

They are overpaid. They make hundreds of thousands of dollars!

And they don’t perform well. Look at the wait times!

They should be made to pay their fair share.

“You say, ‘Williams, don’t you believe in helping your fellow man?’ Yes, I do. I believe that reaching into one’s own pockets to help his fellow man is both laudable and praiseworthy. Reaching into another’s pockets to help his fellow man is despicable and worth of condemnation.”

— Walter Williams

Doctors have gone through hell in Ontario. Net income is down 30% since 2012, before benefits, retirement, taxes, etc.

Doctors have just started to tip-toe around rebuilding a working relationship with government. There is hope, but doctors are extremely skeptical of anything to do with government right now.

Rebuilding a relationship centred on equity and respect will take time and consistent behaviour from both sides.

The federal Liberals’ attack destabilizes doctors, again. It makes business planning impossible. Doctors do not know if they can sign leases, purchase equipment or hire employees.

Doctors assume huge debt during training and even more to start a practice. They have no benefits, pension or sick time. If they get injured or lose their job, doctors have no unemployment insurance.

The tax “loophole” of incorporation addressed some of the challenges facing small businesses. It made private practice doable.

Who Cares?

Cuts to doctors mean cuts to patient care. It will take months, or years, but patients will feel the cuts inevitably.

Cuts do not make doctors work harder.

Doctors become even more demoralized. They work less.  They tell their children to avoid medicine. They retire early. They leave Ontario.

But maybe government likes this. Fewer medical services means less spending on medical care.

As for docs leaving Ontario, a prominent journalist said recently, “There’s the door.”  Nice.

CIHI estimates that we will have 68% more seniors over the next 20 years. Seniors need doctors. Even Toronto’s far left media outlet published an editorial, this week, worrying about the impact on patient care from underfunding physician services.

Provincial and Federal Liberals need to figure this one out. To be clear, the feds caused the latest problem, not Ontario. Still, governments communicate.

You cannot tag team doctors without harming patient care. Many doctors are convinced government hates them. It might be wise for government to show that it does not hate patients.

 

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32 Replies to “Overpaid and Under-Performing”

    1. Thanks Paul,

      That means a tonne, especially coming from you!

      Thanks for reading it and taking time to share a comment. Readers love the comments best.

      Warm regards,

      Shawn

      1. What’s disturbing is that this appears to be just the first step in eliminating Incorporation/ Family Trusts for Physicians and Dentists.Note Mr Morneau did not use the word/ phrase family as in Family Trusts. That might be construed as an attack on families ( which it is).
        In New Brunswick , any personal income over $240,000.00 is now taxed at 60%.Of course another direct hit to physicians and dentists as is the Liberal Masterplan . As a group( I’m a dentist) we will never be paying our” fair share” no matter how high our taxes go.The sky is the limit!

        1. Well said, James!

          I believe the the inheritance tax hit 98% for Britain in the 1970s (before Thatcher came to power). Once people feel it is morally acceptable to for government to seize other people’s money to spend on social activism, there is no end to the appetite for higher taxes. The Greeks opposed direct (mob) democracy because the majority will always vote to support oppression of minorities if it might benefit the masses. The incessant call of Marx will never die. It holds eternal attraction for those who do not know history: “From each according to his ability, to each according to his needs.”

          Only the foot vote will change things, if government insists on abandoning principles….very sad.

          Thanks for taking time to comment!

          Shawn

  1. My accountant’s response is a bit re-assuring (below), thou we shouldn’t tolerate this outrage anyway: I contacted all 3 London MPs last Frd & sent a letter to our group MDs to do the same.. can get more together led by OMA.
    “At this point it should not affect the current strategy – The proposed legislation will not affect a payment to a person over 24 years of age . You may know that we could not pay a dividend to a child under 18 years old. The government is considering extending this to 24. There are other changes proposed but the process is early.
    Given the tax loss to the government is only $250 million it is similar to using a machine gun to kill a mosquito.
    Even if they limit dividends salary can still be used to split income”

    1. Thanks Alexey!

      So, are you saying that we can no longer pay our children, who work in our offices, dividends anymore?

      Thanks again!

      Shawn

      1. What is more important, we will be limited/taxed to assist our children thru the years of college/post-grad: all our aid will be taxed at 50%… for the office work “peanuts” we might still pay them a little salary..

  2. Thank you Shawn, If you had started with this piece rather than the previous one, I would have been more optimistic about your leadership. I am hopeful that you will continue to go after the issues that your constituents are faced with and stop lauding Wynne and Hoskins for the few pre election crumbs that they are throwing around in the media. A few million for this and that does not signal a commitment to healthcare, it is all about optics. I am looking forward to seeing you publicly take the government to task.

    1. Thanks for taking the time to write, Samantha.

      I completely understand your point of view, if you had only started reading at my last post. I understand how any questions about ‘How can we work with government’, given all that we’ve been through, would be garish and inappropriate. I hope you get the chance sometime to read through some of the last 4 years of posts. Most of them are very outspoken about how government needs to get out of the way and let doctors do what doctors do best: care for patients.

      Thanks so much for being outspoken and engaged. I hope we will continue to see your fire and passion. Please know that disagreement is a good thing. If 2 of us think the same about everything all the time, one of us is useless.

      Kind regards,

      Shawn

  3. There is a parallel with Mao’s Barefoot Doctor campaign…he also pushed urban doctors into rural areas ….he also dumbed down the training program of the Barefoot doctors so that they could be churned out faster and pushed out further in rural areas as a part of the cultural revolution’s great leap forwards ( that ended up as a great leap backwards).

    It seems that the Federal and Ontario government will not be satisfied until they have their own widgetized barefoot doctors…those who have shoes will have them ripped off in the name of social justice.

    Work is a MDs pension plan…by preventing MDs from generating their own pension plan via incorporation do they hope to prolong MD’s careers as government moveable widgets beyond the 10-15 years that they already work after their peers in government/public service retired on generous pensions with benefits?

    1. I always learn something from your comments, Andris!

      Thanks so much for taking time to share.

      Shawn

  4. Shawn:
    I have been waiting an article like this from you.
    It is better late than never.
    Thanks.
    However, this should come out in a wider forum than your private website. e.g. as a statement from OMA or in a press conference.

    1. Thanks Michael,

      OMA has more coming out. We had an interview yesterday with the Ottawa Citizen and another today.

      Great to hear from you!

      Shawn

  5. Shawn, this issue while important, is nothing more than a side show, a distraction from the most important matter – the complete renewal of the OMA. The initial hope we were all felt has replaced with extreme disappointment by what appears to be the exact same executive behaviour that the old OMA repeatedly engaged in when any voice of dissent that challenged the executive was shut down. As the incumbent, please listen to the wise counsel of those who had the courage to resign. They speak for the membership. Don’t just listen to them. Don’t just say something that sounds good. Show us by deeds rather than words that this fight was all worthwhile. From what I have observed, in spite of what you have said and promised, the manner in which matters have been handled has left many of us speechless, bewildered and shaking our heads. In order to fight the enemy the OMA needs to be united. As things are today, I can assure you that the morale at the grassroots is close to being at the ankles. Our colleagues are shaking their heads in disbelief. I doubt if anyone cares what you wrote over the past four years – you are now the leader of a previous rancid organization. We do not need another “politician” at the helm. Deeds speak louder than words.

    1. Thanks Robert,

      I agree. Talk is cheap. In the 11 weeks that I have been President, we have ratified binding arbitration, undergone a massive board governance review and are underway with restructuring, have almost completed a strategy refresh with updated mission, vision and values, developed a new negotiations mandate, and much more. We will share all this at fall council in November.

      Having said this, organizational change takes time. Culture change takes years. We are well on our way. We need to look forward, not backwards. We need to challenge each other but still try to show a united front to those we wrestle against outside the profession.

      Thanks again for offering a challenge. I hope I can live up to your expectations over the next year.

      Best

      Shawn

      1. Shawn, you seem like a really nice guy, I truly believe that you are trying to make change. If you wanted to show the grassroots dissenters that you have the will and authority to make a real change you would have Hudack fired. I have never witnessed a more patronizing and out right aggressive and dismissive person in my life. He is perhaps the last vestige of the old guard, he needs to go and he needs to go now.

    2. Robert

      I deleted your last, long comment. This has veered off the topic at hand. I hope you can understand.

      Best regards,

      Shawn

      1. No hurt no harm and no hard feelings at all. It is your website. Not offended at all. As long as you understood the intent of the comments 🙂

        1. Thanks for being so classy, Robert!

          I hear you loud and clear. Perhaps we need a new post on the issues you raised and then we can let the discussion go wherever it leads….

          Best regards,

          Shawn

  6. Agreed.
    Shawn, if you truly care about the future of physicians lot in Ontario,you will aggressively change the culture of the OMA and unite the profession. Actions speak louder than words and further resignations speak to the lack of TRANSPARENCY within the OMA.Tell us how much is spent on honorarium for 100 committees….anyone who has spent time on hospital committees knows their value….

    1. Thanks Ramunas,

      I agree. Most docs want to build, change and look forward, as you suggest. When you renovate your house, you must put up with the mess for a few months as progress takes shape.

      I appreciate your comment and hope that you will be pleased with the results as the year progresses. You can see my comment above for a quick summary of what’s been done in the first 11 weeks in office.

      Best regards,

      Shawn

  7. I think we should be aware of what is happening with the Federal Government and how it affects doctors and patients

    1. The Federal government, specifically Jane Philpott, has reduced rises to annual health care budget by 3 percent per year from 6 per cent per year – a cut of 3 percent a year. This is in the context of severe cuts to physicians in Ontario.

    2. In spite of requests specifically from Manitoba to delay the legalization of marijuana July 1 2018 in order to deal with the myriad social, legal, medical issues, Jane Philpott has refused and is keeping the July 1 deadline, rushing this through, without carefully considering the effects on driving, on safety-sensitive work and youth.

    3. Jane Philpott has gone against the medical evidence which shows the developing brain should not be exposed to medical marijuana and allowed the legal age to be age 18 as opposed age 21, as recommended by multiple physician groups

    4. The federal government is tabling legislation to stop physicians from using physician corporations for tax benefits, further harming their income, in an environment of reduction of federal transfers and cuts here in Ontario. Jane Philpott is part of the government. Note that our taxes in Ontario are already 53 percent for income over $200,000

    5. While doctors are being hit from provincial and federal governments, Jane Philpott is enforcing the provision of stopping billing outside Medicare. In particular, she is opposed to the innovate Saskatchewan program of 2 for 1 CT where someone pays for their own CT but also pays for one extra CT in the public system. Therefore, she is cutting funding to Medicare, while barring any other methods to raise money.

    1. Thanks Scott!

      All excellent points and major issues. With so many important things to tackle, the biggest challenge becomes focusing our efforts where we can have the biggest impact.

      Thanks again

      Shawn

  8. Thanks for all your good work, Shawn!
    I particularly liked your analogy to a house renovation,and putting up with all the mess to finally get the end result. And that’s what we have to do—Keep our eyes on the outcomes that we want!
    If the end result of the new tax changes is a gain of $250 m. this is equivalent to the Federal government donation to contraceptive advice and women’s aid to Africa. The tax grab has to be more than that.
    What concerns me most is the speed at which these changes are taking place.
    We try to plan ahead and our own MD management advises us on best practices in terms of money management, and now we suddenly have to change course. When retirement is looming ,it is a big worry. It would be nice if we only had a few dollars to”sprinkle” on our children.
    Keep up the good work.
    You have accomplished a lot in a few weeks.
    The “Donald ” may come looking to see what magic you use!

    1. Thanks Chris!

      Sure appreciate your encouragement. I understand people wanting change more quickly. I get that. It really helps when people like you share comments, like you did, to say that change takes time….and in fact, we have accomplished quite a bit in a short time.

      This tax issue is a major issue. It impacts people from all kinds of businesses. I think we can form a powerful coalition to fight this….those plans are underway.

      Great to hear from you. Thanks again,

      Shawn

    2. Unbelievable.. to get such a meager return (just to throw it lightly on a wind later).. and deprive half of Canadian physicians of the chance to retire with dignity.. To burn one’s neighbour’s house to cook yourself an omelet?.
      And they (Lib’s) believe that Canadians will feel happy for that: to squeeze the fat-cats doctors & small business owners? Well, they seem to know Canadian mentality very well, but can we/OMA do anything (campaign, advertisement..) to win people’s sympathy/feelings, and not just for this issue, but the long-term success of our profession?
      Canadians have no problems with overpaid celebrities or athletes, how to make them realize that their doctors are more important for them than anybody else?

  9. In my behavioural psychiatric days we listened to the language of behaviour and didn’t allow ourselves to be influenced by words….we regarded patients as being ‘ bilingual’ …actions/ words.

    If the behaviour and the words were in parallel, then perhaps we would listen to the words…but if they were in conflict , we listened and gave weight to the language of their behaviour.

    The behaviour of the government and of the MOHLTC speaks for itself…I have for years been completely deaf to any governmental language that conflicts with its behaviour.

    One hopes that Shawn and the OMA Board place wax in their ears as did the crew of Ulysses ‘ ship so as to be deaf to the singing of the governmental Sirens who are trying to lure the medical profession onto the rocks ( and the Sirens are doing a good job from their perspective so far) , focusing only on their behaviour …Ulysses had himself tied to the mast ( wax less) so that he could hear the singing ,with the order that if he tried to break free that his crew should use their swords and kill him.

    1. Another great comment, Andris.

      While I disagree with behaviourist philosophy, I like how you’ve applied it here. I agree. Show us why we should trust you. This applies to me and to the whole OMA, too. Trust is earned. Actions must support speech or else speech means nothing.

      Now, I need to find me a mast pole to strap myself to… 😉

      Thanks again,

      Shawn

  10. Great article., Shawn.
    Why do we not hear about doctor bashing in Europe? Why does there seem to be more respect for doctors there and even in the USA? Is doctor bashing part of Canadian culture, like hockey? The denominator appears to be the culture of the country’s government. Healthcare has become a cash cow for many armchair quarterbacks and political currency for many politicians and bureaucrats. Unless this culture of vilification and public encouragement to disrespect doctors is corrected, Canadian healthcare will never be in the top league.

  11. Looks like Canadian doctors not alone in poor satisfaction scores. Doctors don’t seem too happy in Germany: http://www.nbcnews.com/id/13504290/ns/world_news-europe/t/doctors-flee-germany-higher-pay-abroad/
    Apparently the Netherlands is number one: good pay, benefits, not micro-managed, and less work load with minimal waiting lists. But you have to learn Dutch, and that is a challenge! Australia has great pensions, beautiful beaches, barbecues, and lacks political correctness. But, poisonous spiders, crocodiles and strange marsupials…. maybe not so bad.

    1. Stephen, I was trained in Sydney, Australia. Hybrid health care system. Works very well. Hot as heck. Nice, decent people with intact spines and intestinal fortitude. They call a spade a spade. Straight forward. I would say that they are “appropriately correct” and very fair minded rather than lacking politically correctness. They dislike anyone of any stripe/colour who live in Oz who cause trouble – regardless of whether they are born there or are immigrants. Had a bad record of how they treated their indigenous people but so does Canada. One of the first countries to fight apartheid. Had a White Immigration Policy until 1959. They have their rednecks – as does Canada (mainly in Queensland (Great Barrier Reef) region). Have learned to accept and embraced multi-culturalism over time. Minimum wage is ~ $17.50 (yikes!). Housing is very expensive. The medical education I received there was top notch. Was way less litigation oriented. Much more respect for physicians. Great soldiers. Would not hesitate to go to battle flanked by an Aussie on my left and a Canuck on my right. They do have redbacks (hello Ottawa??) & funnel web spiders but everyone is taught about them and the ERs are prepared so it’s not that bad. Crocodiles do not walk down George Street downtown or in the suburbs so not worries mate. And would you really like to know what koalas, kangaroos, wallabies and wombats think of Canadians? They think we are strange! So why did I leave their fair shores? Amongst other reasons was that I really, really wanted to experience all four seasons.

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