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I just read the abstract of @GottliebEcon’s paper that generated so much twitter controversy, and I’m confused. Two takeaways IMO: 1) physician incomes respond a lot to govt reimbursements, but 2) this is not a major factor in inequality or health spending.
What I am most surprised by is @Jabaluck’s take that doctors’ salaries are an important cause of high health prices, while also admitting this account for only 9% of all spending, and also that he believes it is relevant that the avg doctor makes more than avg lawyer?
Meanwhile, the pertinent comparison never made by @Jabaluck is: what % of legal spending is accounted for by lawyers’ salaries? Can guarantee this is MUCH higher than 9%.
This is the real story here: patients and society are paying more for care and receiving less of what they want: one on one time with physicians. *OUR* profession has been bureaucratized in a way that inserts many eager hands between physician and patient.
I am not surprised that docs took umbrage at @Jabaluck’s interpretation which seems to miss the forest for 9% of the trees.
Meanwhile, the key finding of the paper seems rather unremarkable: a profession compensated substantially by govt insurance programs has incomes that respond to the size of that payment.
I’m no economist, but if I saw that the salaries of the highly-trained professionals providing a service in a service industry received less than 1/10th of the revenue generated by that industry, my initial conclusion would not be those professionals are overpaid. 
