© CBC Doctors at the Associate Clinic in Pincher Creek say they will no longer work at the local hospital after the government changed the billing structure, effectively reducing their pay.

Doctors in Pincher Creek are the latest to announce they'll no longer work in their local hospital in the wake of changes to the way they're compensated.

The physicians in the southern Alberta town say their decision is driven by the provincial government's move to scrap the doctors' contract and move ahead with some drastic changes to their pay.

Pincher Creek family physician Dr. Samantha Myhr says doctors in rural Alberta are facing death by a thousand cuts.

"It's been demoralizing," she said.

Myhr says seven of the nine physicians at her clinic will give three months' notice that they will stop providing inpatient, emergency and obstetric services at their local hospital.

"It was a combination really of cuts and trying to figure out how do we keep this place sustainable," she said.

"Really, the thing we want to avoid is losing doctors altogether because that means a thousand-plus abandoned patients per doctor."

The provincial government walked away from bargaining with doctors in February and pushed through a number of changes three weeks ago to how they can bill for services.

© THE CANADIAN PRESS/Jeff McIntosh A wind farm overshadows a small subdivision near Pincher Creek, Alta., Wednesday, March 9, 2016.

That has led to a lawsuit by the Alberta Medical Association, which argues doctors' charter rights were violated by not having access to third-party arbitration.

Some of the most contentious changes include pay cuts for work in hospitals and cuts to the reimbursement for costly medical liability coverage.

The province says Pincher Creek Hospital is not closing and AHS will ensure that services continue to be provided, Steve Buick, spokesperson for Alberta Health Minister Tyler Shandro, told CBC News.

"The minister has been meeting extensively with his rural MLA colleagues and speaking to rural physicians," he said.

He added that the minister will make an announcement about rural physician recruitment and retention later this week.

Groups of doctors in several other communities — including Stettler, Sundre and Rocky Mountain House — have also decided to pull back on hospital services.