Factors associated with the income distribution of full-time physicians: A quantile regression approach

Objective Physician income is generally high, but quite variable; hence, physicians have divergent perspectives regarding health policy initiatives and market reforms that could affect their incomes. We investigated factors underlying the distribution of income within the physician population. Data Sources Full-time physicians (N=10,777) from the restricted version of the 1996-1997 Community Tracking Study Physician Survey (CTS-PS), 1996 Area Resource File, and 1996 health maintenance organization penetration data. Study Design We conducted separate analyses for primary care physicians (PCPs) and specialists. We employed least square and quantile regression models to examine factors associated with physician incomes at the mean and at various points of the income distribution, respectively. We accounted for the complex survey design for the CTS-PS data using appropriate weighted procedures and explored endogeneity using an instrumental variables method. Principal Findings We detected widespread and subtle effects of many variables on physician incomes at different points (10th, 25th, 75th, and 90th percentiles) in the distribution that were undetected when employing regression estimations focusing on only the means or medians. Our findings show that the effects of managed care penetration are demonstrable at the mean of specialist incomes, but are more pronounced at higher levels. Conversely, a gender gap in earnings occurs at all levels of income of both PCPs and specialists, but is more pronounced at lower income levels. Conclusions The quantile regression technique offers an analytical tool to evaluate policy effects beyond the means. A longitudinal application of this approach may enable health policy makers to identify winners and losers among segments of the physician workforce and assess how market dynamics and health policy initiatives affect the overall physician income distribution over various time intervals.