The American Interest
Analysis by Walter Russell Mead & Staff
More California Chaos: Psychiatrists Making Millions

It pays to be a psychiatrist for the state of California. When a federal court forced the state to improve inmate care in 2006, prisons raised pay to attract psychiatrists. Between then and now, one couple earned nearly $5 million, all paid for by taxpayers. Another 16 psychiatrists made more than $400,000 per year. Some saw their salaries literally double. The effects have been damaging. Bloomberg reports:

The jockeying between agencies for the same doctors demonstrates a payroll system run amok and chronic mismanagement, said Jeffrey Sonnenfeld, senior associate dean at the Yale University School of Management and founder of a training institute for chief executive officers.

“Even though this all took place in California, such apparent recklessness is almost too over the top for Hollywood,” Sonnenfeld said. “These irresponsible public officials have artificially constrained the market with an unnaturally limited supply pool, either due to laziness, incompetence, corruption or all of the above.”

To be fair, the picture is complicated. Many prisons and mental health facilities are understaffed, and most of them can save money by placing their psychiatrists on-call rather than hiring more of them. What’s more, the work is not easy. Some of these jobs involve spending long hours in intimate contact with very troubled people in facilities located in remote areas. As the California union president said, “You have to give them an incentive.”

But inefficiency and mismanagement are out of control in California. Many psychiatrists are being paid disruptively high hourly rates, even while they sleep. One man was paid for an average of 17 hours per day last year, including Saturdays and Sundays. He brought home $822,302.

At some point, California will need to follow Wisconsin and Michigan in tackling public employee compensation problems like these. When it does, expect a long and painful fight. No one ever said change was easy.

Published on December 13, 2012 12:30 pm