Doctors from across Canada are launching what they're calling an email "MD Pension Action Day" today, to press the federal government to change rules so they can contribute to pension plans.
The doctors want federal Health Minister Leona Aglukkaq to call for changes to current tax legislation to allow physicians access to pension plans.
Under the current system, the federal government deems doctors to be self-employed, small-business owners. So, like plumbers or dentists, they are responsible for funding their own retirement, through RRSPs and other investments.
Yet unlike plumbers or dentists, doctors in Canada are paid by provincial governments who determine their fees and prevent them from charging costs outside of the system.
The doctors argue that every other health professional organization that works under the Canada Health Act is treated like a union and gets paid a pension from its union by the government. But physicians are locked out. What's more, they say, doctors across Europe have group pension plans, but Canadian laws prevent them from doing the same.
The doctors want the federal government to change the Income Tax Act to allow them to collect pensions while remaining self-employed, explains Dr. Mary Fernando, who has been advocating for physician pensions for years.
"We pay our own overhead, that's what makes us independent contractors," she explained to Canada AM from Ottawa Monday. "We pay our staff and for every cotton ball we use in the office, but what we do not get to do is set our own fees. Those are set by the government."
Time-strapped physicians have always had to manage their own retirement investments. Many Canadian doctors -- whose average age now is 50 -- have had such huge losses on the markets in recent years, they are being forced to delay retirement or even come out of retirement.
Other younger doctors have decided they would prefer to move to areas where they can make more money and have their retirement investments be better protected. Fernando believes that chaning the pension rules would give Canadian doctors one more incientive to stay in Canada.
"We lose physicians in large numbers. Over the last 30 years, we've sent 19,000 Canadian physicians to the U.S.," Fernando said. "So as we continue to train physicians, it's a bit like pouring money down the drain. We need to find new ways to not just train new physicians, but to keep physicians in Canada."
It's well-acknowledged that doctors earn good salaries. Gross income for family doctors averages close to $200,000. Specialists can earn $300,000 or even much more. Fernando says that what doctors are asking for is not new money. What they want is the right to direct salary increases to group pension plans.
"Right now, when provincial governments put a new dollar on the table for a fee increase, all they can say is: 'This is a dollar more for your fees.' They cannot say, 'This is a dollar we can put aside for a pension. I will ask you to put aside your dollar too, and you will get both your dollar and our dollar if you work in Canada'," Fernando explained.
Many doctors in Europe have access to group pension plans. The U.K., for instance, has an exemption in its tax law that acknowledges that fee-for-service doctors working in the National Health Service aren't regular small business people, since they can't set their own fees. So they have government-backed, defined-benefit pensions.
The Medical Post, a bimonthly magazine aimed at family doctors, has launched a media crusade to promote the pension proposal, called MD Pension Action Day. They're asking the 67,000 licensed doctors in Canada to email Minister Aglukkaq today at Aglukkaq.L@parl.gc.ca to ask her to advocate changing tax law so Canadian doctors can get pensions.
