Payments to doctors increased to more than $20 billion in 2010-2011, up six per cent from the previous year, according to a new Canadian report.

The rate of growth slowed from 9.7 per cent in 2008-2009 and 7.9 per cent the following year, the Canadian Institute for Health Information said Tuesday in its annual report on physician payments.

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Advances in technology have allowed cataract surgeons to be more efficient. (Aaron Favila/Associated Press)

Overall, hospitals account for about 20 per cent of health care spending, drugs 16 per cent and physicians 14 per cent.

"Physician expenditures remain the fastest growing of the three," said Walter Feeney, the institute's program lead for the national physician database.

The report's authors also looked at changes in how doctors are paid.

Mostly, physicians are paid fees for each service, such as providing annual physical exams or a surgical procedure. This type of payment accounted for nearly three-quarters of the payments.

Alternative payments such as salary, contracts of payments per hour or day based on the number of patients in a doctor's practice, are becoming more common but are still in their infancy, Feeney said. Over a decade, there's been a "dramatic rise" in alternative forms of payment, from less than 10 per cent of total payments to more than a quarter now.

Provinces and territories could turn to alternative payments to meet their individual needs, such as to retain doctors in certain areas, he added.

Average gross clinical payment per physician ranged from highs of $350,000 in Alberta, which uses only the fee-for-service model, and $340,000 in Ontario, to lows of $250,000 in Nova Scotia to $236,000 in Prince Edward Island.

The averages did not take into account provincial variations such as the number of part-time physicians, visiting specialists or cost of living. A doctor's final income would depend on how much he or she pays for staff, equipment and other expenses.

Specialists received an average $350,000 compared with $240,000 for family doctors.

Nationally, the specialties that billed the highest, on average, were:

  • Ophthalmology — $675,000.
  • Thoracic/cardiovascular surgeons — $467,000.
  • Urologists — $430,000.

Within ophthalmology, which tends to be the highest paid specialty, Feeney said advances in technology in the past 10 to 15 years could allow doctors to perform cataract surgeries more efficiently, which in turn drives up the volume of patients served.

In 2010-2011, family physicians billed an average of $40 (a 3.6 per cent increase) while specialists billed $74 (6.8 per cent increase from the year before) per service, according to the report.

This year's report introduced a new measure called the average gross clinical payment per physician, which combines fee-for-service payments and alternative payments. It's meant to offer a more comprehensive picture of how doctors are paid.

The average gross clinical payment in 2010–2011 was more than $307,000 per physician. At 3.1 per cent, this was the smallest increase in the last five years.

The institute is working to expand the indicator to include specialists.