It’s tax time again and that got me thinking. And thinking got me angry. And angry got me belligerent. And belligerent got me nowhere. So, I went back to thinking about it, and here’s my take: Taxes are the contributions we make to society and the government so that it functions reasonably well, preserves our fragile democracy, and supports those who need our help. Yet, as a physician in a primary care specialty, like many of you, I can’t help but feel resentful this time of year. I’m “taxed out,” so to speak.
In a previous column, many years ago (October 2011), I postulated that a primary care physician, over the course of a typical career, has the same lifetime earnings, net the cost of education, as a structural iron worker. While this might come as a big surprise to the general public, it is unlikely to draw any sympathy. And I understand that. Yet, every year, around this time, the resentment bubbles up again. This year, however, was different.
While reflecting back on my 2011 column, I realized that I was in error. The initial results demonstrated that the lifetime earnings of the primary care physician and the structural iron worker were about the same. Wrong! In fact, the lifelong earnings of the typical primary care physician may just be quite a bit lower than the structural iron worker.
Why? Well, taxes of course. The problem? Let’s say the primary care physician makes $200,000, and the structural iron worker makes $70,000, annually. On federal income tax alone, $200,000 of income would generate almost $50,000 more tax per year than an income of $70,000 would. Over a 35-year career, that’s a total of $1.75 million more in taxes. So, after investing upwards of $500,000 in education and delaying earnings until we are almost 30 years of age, the primary care physician gets the privilege of paying nearly $2 million more in taxes than a high-earning tradesperson.
Combine that with the interest paid on the student loans (because we make too much money to qualify for the tax deduction on those loans), and the impact is even more staggering. Why should we be paying taxes on earnings we will never see, just because of the irrational sacrifices we made choosing a primary care career? It’s a double-dip of sacrifice, and that has been mostly ignored. Throw in the Medicare tax supplement, and the Affordable Care Act tax supplement recently added for “high earners” like us, and we just very well may be the most tax-burdened group in America.
The final straw? Most of those making more money than us, often in the form of capital gains or offset by business “expenses,” are also paying less in taxes as a percentage of their income than we are. Essentially, all income groups, above and below our own, are paying lower tax than we are.
So, what’s the point? This just sounds like a rant! Well, my ranting got me thinking again, and this is where this whole column comes together.
Primary care, with its relatively low earnings, extremely high burnout rate, and critical function in society, is essentially a public service. And as such, we should look for ways to offset the cost of “becoming” a primary care physician. While covering the real “cost” of higher education would be prohibitive, making the educational expenses tax deductible on a schedule that spans a typical primary care career just might make sense. It would encourage an ongoing commitment to primary care, reduce burnout, and spread out the economic impact.
We must look for ways to eliminate the double-dip of sacrifice that is inherent to our current tax system and turn the same system into a scheduled methodology for making primary care a rational, rewarding, and sustainable choice for years to come.
Lee A. Resnick, MD, FAAFP
Editor-in-Chief, JUCM, The Journal of Urgent Care Medicine
