DOUGLAS GREEN, MD

READING ROOM WITH A VIEW

Taxi Driver or Bank Clerk? Would you rather be a taxi driver or a clerk in the personnel department of a large bank? Assuming that you have no interest in actually doing either job and that the annual incomes are about the same, the only relevant difference between the two jobs is the volatility of those incomes. A taxi driver can have very busy days along with very slow days. A bank clerk is on salary; every 2 weeks, an identical amount is direct-deposited into his or her checking account. At first take, the bank clerk position might seem to be the safer choice. But although the bank clerk does not suffer the day-to-day income volatility of the taxi driver, bank workers may be at higher risk for losing their jobs outright and without notice, as many in fact did during the financial crisis and the ensuing Great Recession. For these workers, finding a new job that pays an equivalent wage can take a very long time [1]. The incomes of taxi drivers and bank clerks sit at opposite ends of a volatilityevulnerability spectrum. Over the course of the past century, physicians’ incomes have moved from the taxi-driver end of the spectrum toward the bank-clerk end. When Dr Gilman Frost obtained an x-ray of young Eddie McCarthy’s fractured left wrist on February 3, 1896 [2], no American had medicalexpense insurance. Presumably, Eddie’s parents had to pay for the service in cash or chicken. Most doctors’ incomes were as volatile as that of a taxi driver. Some days there would be many patients with broken wrists, and other days there would be none. Over time, given icy sidewalks

and a stable or a growing population, there would be enough patients. As health insurance plans became widespread in the mid-20th century, private practice physicians’ incomes became less volatile but more vulnerable. The plans cover the medical costs incurred by their policyholders; payments are in the form of cash, not livestock. In exchange for this lowered volatility, physicians must accept the possibility that an insurance company can choose to direct all of its patients to other providers. If that does happen, physicians lose fractions of their incomes proportional to the percentages of their patients covered by the insurance company, but not their jobs. The introduction of Medicare nearly 50 years ago swelled the ranks of the insured, further lowering the volatility of doctors’ incomes but introducing a new vulnerability: the threat of a sudden and drastic decrease in reimbursement rates has been hanging over our heads since the Balanced Budget Act of 1997. In addition to their contracts with insurance companies, private practice radiologists have contracts with the owners of imaging equipment. These contracts grant the radiologists the right to read the studies performed on this equipment and thereby to lay claim to the attendant professional fees. This serves to decrease volatility; the studies done each day go to the group that has the contract, not the low bidders on a spot market. However, the group is vulnerable to losing the contract itself and the

group members to losing part or all of their incomes. As market forces drive more of us to become hospital employees, we find ourselves in the position of the bank clerk: none of the volatility, all of the vulnerability. As salaried employees, we have the apparent safety of a monthly paycheck. We are partly insulated from the risk that a carrier will decide to take its business elsewhere or reduce reimbursements; our paychecks still arrive. However, if a carrier that controls a large percentage of the patients for whom our hospital provides care (or several carriers each controlling a smaller percentage of the patients) decides to terminate its contract or reduce reimbursements, the hospital may decide to lower our salaries accordingly or even get rid of us entirely. In the present job market, it may take a very long time to find a new job. Many of us chose medicine as a “calling.” That said, it was a calling that came with the important perk of a high and stable income. For the risk averse, this was more appealing than a career in the upand-down business world. Increasingly, though, it has become clear that the lack of volatility of our incomes is counterbalanced by a high risk of losing a large amount, if not all, of it. REFERENCES 1. Taleb NN. Antifragile: things that gain from disorder. New York: Random House, 2012. 2. Spiegel PK. The first clinical x-ray made in America—100 years. AJR Am J Roentgenol 1995;164:241-3.

Douglas Green, MD, University of Washington, Department of Radiology, 1959 NE Pacific Street, Seattle, WA 98195-0001; e-mail: [email protected].

ª 2014 American College of Radiology 1546-1440/14/$36.00  http://dx.doi.org/10.1016/j.jacr.2014.04.005

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Taxi driver or bank clerk?

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