Whether practising medicine in Canada or the U.S., gross physician earnings in North America tend to be higher than the rest of the world. However, the average and median salaries for a medical doctor can vary, depending on factors such as specialty, experience and geographic location.
How much do doctors make in the USA?
In addition to location, specialization and years of experience, it should also be noted that physician gross salary averages, medians and ranges can differ depending on the source. For example:
- According to the US Bureau of Labor Statistics (BLS), in 2022 the median annual wage for physicians and surgeons was $229,300 (USD).
- Based on the data from nearly 300 salary profiles on Payscale.com last updated on February 14, 2024, the median salary for a Physician / Doctor, General Practice in the United States is $181,347 (USD) per year.
- On Salary.com, the average salary for a General Practice Physician is $227,690 (USD) as of February 26, 2024, with the range falling between $200,590 and $261,290 (USD).
- With 7,400 salaries reported, updated at March 4, 2024, the average base salary for a physician on Indeed is $187,065 (USD) per year.
How much do doctors make in Canada?
Conversely, in Canada physician gross salary averages, medians and ranges can differ depending on the source of information.
- According to the Government of Canada Job Bank, the median annual salary for a General Practitioner (GP) in Canada is $233,726 (CAD) as of January 23, 2024.
- The average Physician / Doctor, General Practice base salary in Canada according to Payscale.com is $187,500 (CAD) per year.
- With 1,000 salaries reported, updated at March 4, 2024, the average salary for a physician in Canada is $284,515 (CAD) per year according to Indeed.
Please note that since U.S. doctors do not report to government regulatory bodies, salary data is generally obtained through self-reported surveys. Thus U.S. salary figures for doctors have the potential to be misreported or exaggerated, which may contribute to the belief that American doctors make much more money than Canadian doctors.
However, there is a commonality among the average salary for medical doctors in both countries. Given that most jobs in the medical profession require extensive education and training and are some of the most in-demand and demanding positions, physicians employed in Canada and the U.S. can expect to be some of the highest-earning and most well-compensated in the workforce.
Also, due to immigration growth, an aging population, increasing rates of chronic illnesses and doctors entering retirement, the demand for physicians (and corresponding compensation) is expected to continue to grow.
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Factors that contribute to differences in doctor salaries between Canada and the U.S.
So how does the average physician salary compare between the U.S. and Canada? When you compare Canadian vs. American physician salary, there are a number of factors that contribute to the variations. By far, the most significant reason is due to the healthcare system in each country. In the U.S., healthcare is mostly privatized, allowing physicians to bill health insurance companies for the procedures they perform with any remaining costs covered by the patient. This fee-for-service reimbursem*nt model leads to U.S. doctors having a higher earning potential.
In Canada, the healthcare system is publicly funded, which may lead to lower physician salaries due to capped billing rates and stricter government regulations. With Canada’s universal healthcare system, also called a single-payer system, doctors must bill their services to provincial health authorities at standardized rates. Thus each medical specialization and individual practitioner earn different annual salaries depending on the cost of each procedure and the number of patients they see.
For example, the estimated inpatient cost for knee replacement surgery in Canada, which would be covered by a provincial healthcare plan, is approximately $10,500 (CAD). For patients without health insurance in the U.S., a knee replacement can cost $35,000 (USD) or more. If you are a doctor who is considering practising in Canada (or you’re already on your way), you may also want to read our blog about Billing in Canada for International Doctors.
The effect of specialization on salary
Next to the different healthcare systems and reimbursem*nt models, specialization is the factor that plays a critical role in pay differences. According to the Canadian Institute for Health Information (CIHI), in 2020 family medicine doctors grossed $287,000, while medical specialists earned $370,000 and surgical specialists earned an average of $487,000 (CAD).
According to the BLS in the U.S., while the median annual wage for physicians and surgeons was $229,300, among the 17 specialties identified, cardiologists have the highest average annual wage of $421,330, followed by non-pediatric orthopedic surgeons at $371,400 and pediatric surgeons with $362,970 (USD). Overall, the more specialized the practice is, the higher the potential compensation.
Regional variations in physician compensation within the U.S. and Canada
Cost of living significantly affects doctor salaries in both countries. Physicians practising in states or provinces, and cities with higher housing costs, taxes and other living expenses may command higher salaries to maintain a comparable standard of living. Consequently, physicians in urban centres like Chicago, New York, Vancouver and Toronto may earn more than those in smaller towns or rural areas. However, the take home pay after taxes, housing costs and other expenses, may end up levelling up.
It should be noted that regional variations in doctor compensation are more pronounced within the U.S. than in Canada. In four states, Hawaii, Louisiana, Idaho and Minnesota, physician and surgeon salaries top $500,000 a year. In comparison, West Virginia, Oklahoma and Nebraska have the lowest average annual salaries for multiple specialties (under $149,000 USD).
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Impact of malpractice insurance and operations expenses on doctor salary
One of the greatest benefits for physicians practising in Canada is the lower cost of legal protection. Canadian doctors are protected by malpractice insurance provided by the Canadian Medical Protective Association (CMPA). Damages are capped and legal settlements are uncommon. Doctors pay fees to the CMPA based on the type of medicine practised and the geographical area where the doctor works, not on the number of malpractice claims filed against them. The provincial regulatory bodies then reimburse doctors for a large percentage of these fees.
In the U.S., doctors pay a third-party insurer for their malpractice insurance. Physicians who are sued for malpractice can see skyrocketing awards for damages. The legal damages for pain and suffering awarded to the victim in Canada are capped at $300,000 (CAD), while the average amount of damages in the U.S. is $360,000 (USD).
Although income taxes in the United States may be lower, the Canada doctor salary vs U.S. doctor salary could actually be higher when you take into account cost of operating a practice. According to a Medscape survey, 48% of U.S. physicians operate out of their own solo or group practice. This means they are responsible for all the overhead costs associated with operations, including billing, collections, staff salary and insurance. Since the single-payer model simplifies billing, Canadian doctors can handle most billing needs with a good software program, like Dr.Bill.
Typical benefits included in physician compensation packages in the U.S. vs. Canada
While there’s no universal physician pay model in the U.S. and Canada, both healthcare systems are recognizing the importance of benefits and total compensation packages in attracting and retaining talented physicians, which can improve job satisfaction and patient outcomes.
Benefits may include flexible schedules, paid vacation, professional development, relocation assistance, and comprehensive life, dental, vision and disability insurance.
Due to the private nature of healthcare in the U.S. with less regulations, there tends to be more benefits that can be offered. These benefits include 401(k) matching (similar to the Canadian RRSP), continuing education credits, employee discounts, loan assistance / repayment program, malpractice insurance, profit sharing and referral programs.
Conclusion
Comparing Canadian vs. American physician salary reveals some notable differences and similarities. While the United States and Canada both offer very rewarding career opportunities for physicians, there are a number of factors that can impact overall compensation such as the healthcare system, specialty choice and geographic location.
Over the years, the gap between doctor salaries in Canada and the U.S. has gradually been narrowing. The U.S. generally offers lower taxes and higher average salaries across medical specialties. Canadian doctors have lower education, insurance and operational costs.
Lastly, remember that compensation is not the only factor to consider. While salary is admittedly very important, other things like cost of living, legal risks and work-life balance can affect job satisfaction. Reach out to practising physicians if possible and research the typical responsibilities, work hours and quality of life in both countries.
