“What are you talking about? I’m only 56.”
That’s the kind of remark you can expect if you have the gumption to ask a baby-boomer GP about when they are retiring, says Terry McMaster, managing director at Dover Financial Advisers.
With rising life expectancies and healthier ageing, 80 may soon be the new 60. And, like many Australians reaching their mid-50s, GPs aren’t thinking of calling time on their careers any time soon.
“I sometimes hear people say that doctors are forced to keep on working longer than usual because of economic reasons,” says McMaster, who provides accounting, legal and retirement advice to GPs.
“It’s actually quite rare. Normally, the doctor could easily afford to retire even in their mid-50s with net wealth well above the general population.”
But why would they retire?
“When you get that experience, that grey-hair factor, kicking in, that’s when they get really good,” McMaster says.
“And it can take 30 years of practice before GPs get to the stage where they are best able to cope with all presentations that come in. GPs in their mid-50s have experience, judgement, wisdom, and long-term relationships with patients. They are very competent operators. But you want them to retire? That’s stupid. That’s a waste.”
And for rural GPs, the community need is often too great, and the relationships with patients too deep, to consider bowing out early.
“You feel that there is no-one to take your place,” says Associate Professor Ruth Stewart, the president of Australian College of Rural and Remote Medicine. “Your patients certainly tell you that.
“We all know that there are not enough rural doctors. We are committed to our patients and our community, how can we walk away when there is still breath in us?”
DOCTORS VS THE REST
The increased proportion of late-career doctors is driven, in part, by demographics.
In Australia, baby boomers represent about one-quarter of the population. This group of almost 5.6 million Australians born between 1946 and 1965 are healthier, more active and better educated than previous generations, according to National Seniors Australia.1
By 2030, the baby boomers will be 65 or older. But this group tends to view retirement as optional. Almost half report that they would consider working beyond 65 and around one in five expect they will never retire completely, or expect to “work until they drop”.
And doctors tend to stay in the workforce even longer than the average Australian. A study published in the MJA in March 2017, found that doctors aged 55 or over planned to retire around four years later than people in the general community.2
Male doctors planned to retire at age 69.7, compared with age 65.7 for the general population. Female doctors hoped to retire slightly earlier, at age 68.1, but still later than the population average of 64.5 years.
Around one-third of doctors surveyed either had no intention of retiring or were not sure whether they would retire. Many did not set a date for leaving the workforce.
“Doctors have long retired later than the general population,” said Brian Draper, a professor at UNSW who specialises in old-age psychiatry. “What has happened is that baby boomer-era doctors are probably in better heath than their predecessors and are working to a later age.”
This drift has led to an ageing of the medical profession. There are now 1,700 employed doctors aged 75 or older in Australia.3 Around 10% of the medical workforce was 65 or older in 2014, an 80% increase since 2004.
DUTY TO BE DONE
Most GPs in their mid-50s have probably completed the equivalent of two normal working lives and are dreaming of cutting back a bit, relaxing and enjoying themselves more, says McMaster. “But it is actually not as simple as stopping work. I wish it was.”
There is something about the mind of the GP that stops them from simply walking away. “It’s id, it’s ego, it’s loyalty to the patients, it’s loyalty to the colleagues, it’s a social conscience,” says McMaster.
In the MJA study, psychiatrists and GPs had the lowest intention of retiring out of all specialists, including cardiologists, gastroenterologists and anaesthetists.
Why is that? The answer may be that GP and psychiatrists tend to develop more intimate, long-term relationships with patients than other specialists, says Adjunct Associate Professor Chanaka Wijeratne, a psychiatrist at the University of Notre Dame Australia and an author of the MJA paper.
For some doctors, the void created by the absence of work can be difficult to fill. It’s a huge shock for someone who has invested so much energy into their professional life to suddenly have nothing to fill their time.
“Let’s face it, most of us are scared of stopping work,” says McMaster. “GPs more than most. It’s completely normal.”
Some people view their working life as a career, where achievement is defined by advancement and promotion, whereas others see it more as a job, defined purely by financial success. But doctors tend to place work at the centre of their lives, and view medicine as a calling, where the work itself is fulfilling and perceived as contributing to the greater good.2
For many doctors, work is prioritised at the expense of relationships, hobbies and interests, which can make the transition to retirement much more difficult, says Jo Earl, an author on the MJA paper and an associate professor in human resources management and organisational behaviour at Flinders University.
“Work centrality is not a bad thing,” she says. “There is no problem with people being proud and engaged in what they do.” The issue is when doctors resist retirement, can’t control the conditions under which they exit and suffer from poor adjustment to a work-free lifestyle.
Perhaps an even greater issue is that doctors often view their profession as a “treasured element” of their identity and perceive retirement as threatening.5
“They are really fearful of losing their relevance. The irrelevance of old age frightens doctors. They fight it,” says McMaster.
“If you hang up your stethoscope you go from being doctor in your community to just another old bloke in his tracky-daks shuffling around the supermarket with nothing to do,” he says. “That’s the visual imagery many doctors have.”
In many cases, GPs find themselves financially unprepared at the age of retirement, despite earning a reasonable income over their career, Rosie Foster, NSW Advice Manager at Perpetual Private, says.
While employers are obliged to pay super contributions on behalf of staff in Australia, self-employed GPs are not bound by the same laws.
“As a result, many doctors tend to not make that super contribution over the years,” says Foster. “But that depletes their nest egg heading into retirement, which means they often have to work longer in order to fund their retirement lifestyle.”
GPs who are business owners tend to pour their income back into their practice or use it to pay down a mortgage, with the expectation that they will use these assets to fund their retirement, says Foster.
However, this plan can unravel if people decide not to downsize prior to retirement. “If that is the case, then all of their capital is trapped in the home in which they are residing.”
Concentrating your wealth into one or two asset classes can carry more risk than making diversified investments, says Foster. And people reaching the age of retirement have less time to ride out investment cycles.
Another issue is some GPs are unaware of the tax-effectiveness of saving within the super structure. The “beauty of super” is that any concessional contributions below $25,000 a year are tax deductible and earnings on all funds held in super are only taxed at up to 15% per year during the accumulation phase, which can obviously be a much lower rate than income tax for moderate to high income earners.
A maximum of $100,000 a year can also be contributed to super each year as a non-concessional contribution, that is without the ability to claim a tax deduction, as long as the super account balance is less than $1.6 million. Once people reach a condition of release for super, there is zero tax on income earned by super funds during the pension phase.
Super is currently released at the age of 65 but there are several conditions under which it can be accessed earlier, such as transition to retirement, termination of employment after turning age 60, permanent incapacity, terminal illness or severe financial hardship.
However, the government is pushing up the age of retirement pensions by six months every two years, reaching age 67 by 2023. This year the Turnbull government said it would bump this up to age 70 by 2035.
A common mistake GPs make is not starting super contributions early enough, says Foster. Superannuation monies usually grow further in value when invested over a 30-year timeframe versus investment over 10 years.
Some doctors are very proactive with managing their finances, but others only turn their minds to retirement planning later in life, says Foster. “It’s not something that is taught to them at medical school.”
Based on Foster’s projections, a GP who maximises their super contributions from age 30 could end up with more than $2 million more at age 60 than someone who starts at 50.
DANGERS OF OLD AGE
It is part of the Australian Constitution that High Court judges must retire at 70.
Pilots are subject to increasingly frequent medical tests as they age. This includes an ECG every year after age 40, an annual estimation of fasting serum lipids and fasting blood glucose after 60, and an eye examination at 60 and every two years thereafter.4
But for doctors? Nothing. The only barrier to working until your drop is self-assessment, complaints to AHPRA by patients, or direct action by peers. There is no compulsory revalidation, mandatory retirement age or peer review evaluation for GPs.
This is partly because many GPs can, indeed, safely continue working into their 70s and beyond.
There is a certain longevity to a general practice career, which isn’t guaranteed in specialties such as surgery, says McMaster.
But the literature is littered with stories of once-prominent doctors continuing to work into dangerous old age.5
“Just anecdotally, I do recall, when I was a very junior doctor on rotation to a country hospital the only surgeon we had was aged 77,” says Leon Piterman, Professor of General Practice at Monash University.
“I was assisting him one day in quite a complex abdominal operation, and he just suddenly stopped and looked rather pale and sweaty. And I felt that should he collapse, I was not confident enough to take over. That’s an extreme example, but it is a real one.”
Elderly doctors sometimes lack insight into their own declining abilities, says Professor Piterman. There is a reluctance by doctors to report their colleagues when there are questions about competence.
“I know of cases where there has been early onset dementia occurring in the 60s and the doctors have still been operating,” he says. “It really does require peers to put pressure on the doctor to give it away.”
The literature on the relationship between age and performance in doctors is mixed. The evidence that older doctors produce worse clinical outcomes is “inconclusive”, according to the US researchers.5
But a US study published in the BMJ in May found that patients were more likely to die following a hospital admission when their doctor was older.6
The effect size was small. For every 77 patients treated by doctors aged 60 or over, one fewer patient would die under the care of a younger doctor. “Differences in physician training, as well as declines in skill with ageing, could explain our findings,” the authors said.
The Medical Board of Australia notes that ageing is one of the strongest risk factors for regulatory action.8 The board is currently investigating new revalidation requirements that would possibly help weed out incompetent doctors.
But there is resistance within the profession against a formal process of revalidation involving exams. The AMA has opposed any revalidation scheme that would heap “burdensome bureaucracy” onto the health system without producing any improvements in patient outcomes.
Forcing older doctors to re-sit exams will never fly in private practice, says Professor Piterman. The only system that might be accepted is one of peer review, where panels convene to routinely assess the performance of doctors.
If more GPs voluntarily wound down their practice or moved across to less patient-centric roles later in life, there would be less need for top-down regulation, however.
Not only is this gradual departure from practice psychologically healthier, it also allows the GP to transfer patients to other doctors, says McMaster.
GPs at the summit of their career may be more suited to mentoring or academic positions than full-time clinical practice, says Professor Draper. The wisdom and knowledge of doctors in their 60s and 70s is more valuable their enduring capacity to perform physically demanding tasks and put in long hours.
“My advice every time to the 55-year old GP is to cut back as soon as possible,” says McMaster.
“Go travelling, get to know your partner again, catch up with the kids, look after the grandkids, look after the garden, take up tennis, triathlon, iron man, swim the channel … anything – just don’t go to work.
“And, of course, manage your own health. If you do this, you will probably live longer, happier, earn more money and see more patients and do more good. Everyone is winning.”
- My generation: Are Australian baby boomers the retiring kind? August 2009
- MJA 2017, 20 March
- MJA 2017, 20 March (editorial)
- JAMA Surgery 2017, online 19 July
- The BMJ 2017, 16 May
- Options for revalidation in Australia, Medical Board of Australia, August 2016