According to an analysis in CMAJ, the Canadian Medical Association Journal, Labour economics can provide a valuable perspective in addressing the supply of doctors and access to care. Brian Golden and Sandra Rotman, Chair in Health Sector Strategy at the Rotman School of Management at the University of Toronto, and their co-authors write:

“Understanding and accurately predicting the response of physicians to incentives is essential if governments wish to increase the supply of physician services.”

In Canada, access to health care remains challenging in many regions. Despite a previous over supply of physicians, many people currently experience difficulties in obtaining care.

According to the investigators:

“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. Supply is appropriately managed when there is neither a shortage nor surplus of services.”

The authors state that if provincial and territorial governments would set policies that could persuade physicians to make an impact on the supply of services they offer by working longer hours, the strategy would subsequently help to increase access to care.

However, there is also a danger that this strategy may backfire, as increased pay to attract more physicians could also unintentionally lead to the consequence that physicians would choose to work fewer hours.

Another strategy could be for the Governments to provide non-wage compensation, such as repayment of tuition fees, recruitment or retention bonuses, support for relocation or staffing costs, but non-wage rewards that are not connected to the hours physicians work “also reduce the fixed costs of a practice and create a pure income effect, thereby inducing fewer hours of work and fewer services provided.”

The authors conclude:

“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. Policy-makers should recognize that policies for compensation may result in just what we hope for – or just the opposite.”

Written by Petra Rattue