Saturday, April 17, 2010

Med School Grads Haven't Increased Since 1980; Nurses Can Help, But the AMA Protects Its Turf

Physicians in the U.S. made an average of about $200,000 in 1996, which was between 2 and 5 times as much as doctors made in European countries and Japan (see chart above). The median physician salary in the U.S. is now closer to $275,000 (data here). How do we explain the significantly higher physician salaries in the U.S. compared to other countries? Here's one possible explanation:

The supply of medical school graduates has remained basically flat for the last 30 years (data here). At the same time, the demand for physicians' services has increased over time because of a population that is both increasing and aging. So we've now got more people with more serious end-of-life medical problems demanding more medical care from a limited supply of physicians - and that's a sure prescription for rising MD salaries.

Why hasn't the supply of physicians increased to meet the rising demand for medical services, the way the supply of web designers or software programmers has increased to meet the rising demand for those professions? As Dennis Cauchon wrote in
USA Today in 2005 about the doctor shortage:

"The marketplace doesn't determine how many doctors the nation has, as it does for engineers, pilots and other professions. The number of doctors is a political decision, heavily influenced by doctors themselves. Congress controls the supply of physicians by how much federal funding it provides for medical residencies — the graduate training required of all doctors."

And we're now going to provide health care to an additional 20-30 million Americans under health care reform when the number of new physicians this year is about the same as the graduating class of 1980? Just wondering, did Congress ever consider the reality reflected in the graph above that there has been no increase in the supply of physicians for the last 30 years when they passed health care reform to extend coverage to millions of uninsured?

Here's one solution from Steve Chapman, who suggests that we can "
Nurse Our Way Out of the Doctor Shortage":

"Thanks to health care reform, millions of previously uninsured Americans will have policies enabling them to go to the doctor when necessary without financial fear. But it's a bit like giving everyone a plane ticket to fly tomorrow. If the planes are all full, you won't be going anywhere.

There are not a lot of doctors sitting in their offices like the Maytag repairman, playing solitaire and wishing a patient would drop by. Most of them manage to stay plenty busy. Nor is there a tidal wave of young physicians about to roll in to quench this new thirst for medical care.

Regardless, there seems to be no doubt that it will get harder to find someone to treat you, it may cost more and you'll spend two hours in the waiting room instead of one.

Or maybe not. What people with medical problems need is medical care, but you don't always need a physician to get treatment. You might also see a different sort of trained professional — say, a nurse practitioner, physician's assistant, nurse or physical therapist."

MP: Unfortunately, the medical cartel is not keen on competition from nurses, and according to this news report:


"The medical establishment is fighting to protect turf. The American Medical Association, which supported the national health care overhaul, says a doctor shortage is no reason to put nurses in charge and endanger patients."

23 Comments:

At 4/17/2010 11:13 PM, Anonymous Anonymous said...

Doctors from Sweden (or the UK ;) speak excellent English. I am sure they'd welcome opportunities in the States if green cards were made easily available to them.

 
At 4/18/2010 12:04 AM, Anonymous Anonymous said...

I'm not sure that this is the whole story because not all of America's doctors went to American allopathic (MD) medical schools. An increasing number of US doctors went to osteopathic or foreign medical schools.

It would be more accurate to show the number of physicians who have completed residency in the United States. There is a small chart on this page that shows first year residency positions have roughly doubled since 1952:

http://www.nrmp.org/data/index.html

 
At 4/18/2010 12:26 AM, Anonymous Lyle said...

Note that in a prior post we discovered that new medical schools are now being set up as well as expanding class sizes. In MI for example MSU is opening a new center in Grand Rapids resulting in an increase in class size.

 
At 4/18/2010 1:24 AM, Blogger Dr William J McKibbin said...

I agree that our nation needs to train more physicians. Moreover, we should probably make it our goal to train not only enough to keep up with our own population growth, but to produce sufficient numbers so as to begin "exporting" medical training, technology, and systems. The entire debate about the future of medical care in America has focused on how to divide up scarce medical services. If our nation would instead commit itself to doubling or tripling the number of physicians and other medical professionals in the next ten years, it could be that America could become an net exporter of premium healthcare services, technology, and systems. I have more confidence in our nation's capacity to expand medical care to meet the needs of a growing world population than I have with any notion of expanding manufacturing in an effort to increase exports. Medical care in America is a goldmine that we should learn to exploit in a global economy where healthcare demand is expanding concomitant with populations. Thanks for the opportunity to comment...

 
At 4/18/2010 6:19 AM, Anonymous MLR said...

Don't forget that half the medical school grads are now women. Because of their roles as mothers, they don't work as long hours as their male counterparts. So the "man" hours worked by doctors has gone down and will continue to plummet. This will obviously have an impact on doctor "man" power.
England has gotten around it's doctor shortage by importing them from Pakistan (remember the doctors' plot about blowing up airports and such).
I'm sure that the trial lawyers bar is salivating at the prospect of all these new classes of near physicians that they can sue along with their real doctor supervisors.

 
At 4/18/2010 8:02 AM, Anonymous JB said...

You can't nurse your way out of a doctor shortage if you also have a nursing shortage.

And as for the number of first-year residency programs doubling since 1952... in that year, the US population was 157,000,000 or thereabouts. Less than half of what it is today.

 
At 4/18/2010 9:10 AM, Blogger Josh said...

Here's another way out. We can end the AMA monopoly on licensure:

http://mises.org/daily/4276

Or get Medicare out of reimbursing for residencies:

http://joshfulton.blogspot.com/2010/04/will-us-be-facing-doctor-shortage.html

 
At 4/18/2010 10:22 AM, Blogger juandos said...

"The median physician salary in the U.S. is now closer to $275,000"...

Is that before or after expenses of government intrusion?

I'd say we'ed be real lucky to hang onto the doctors we have...

 
At 4/18/2010 10:51 AM, Anonymous Anonymous said...

Don't forget that about 1 in 9 Canadian med school grads leaves to work in the U.S.. Following the passage and implementation of the "health care" bill the incentive to do so will go away. Also, many doctors have stated that they will retire early rather than submit to the government dictated strictures and mandated compensation schedules on their practices.

 
At 4/18/2010 12:27 PM, Blogger Ron H. said...

Dr William J McKibbin said...

>"If our nation would instead commit itself to doubling or tripling the number of physicians and other medical professionals in the next ten years..."

How do you see that happening in light of the recently enacted healthcare regime? Doctors have threatened to leave medicine or retire early, and there still exist barriers to entry by the AMA?

How would you make a career in medicine seem attractive to potential medical students?

>"...it could be that America could become a net exporter of premium healthcare services, technology, and systems."

I believe that the US is now a net importer of doctors. That tells me that doctors from other countries believe that opportunities for financial success, among other things, is greater in the US than in their native country.

To reverse that trend, doctors trained in this country would have to see their best opportunities existing in other countries, despite the fact that doctors trained in those countries, would no longer move to this country, but would instead stay home to practice.

How would you create such an overabundant supply of doctors in this country?

Where would you find potential medical students willing to invest the time and money necessary, only to find their best chances in a foreign country?

What am I missing here?

 
At 4/18/2010 5:29 PM, Blogger Jet Beagle said...

"So we've now got more people with more serious end-of-life medical problems demanding more medical care from a limited supply of physicians"

I'm not sure that's a complete picture, Mark. According to a 2002 study by Marilyn Bivianp and Farzaneh Makarehchi, the future shortage of physicians was recognized in the 1960's and 1970's. As a result:

"Domestically, during that period of time, the annual number of U.S. medical school graduates (USMGs) doubled."

At the same time, the number of U.S. physicians trained in other countries (International Medical Graduates) continued to grow:

"In the early 1960’s, IMGs were about 10% (26,048) of the physician workforce; by 1970 that percentage had increased to nearly 18% (57,217). Today, IMGs are about 25% (196,961) of the U.S. physician workforce."

"The impact of these education and immigration policies has been to double the nation’s physician supply. Physician availability as measured by physician-to-population ratio increased by 70%"

 
At 4/18/2010 6:16 PM, Anonymous Anonymous said...

Scotland graduates around 1500 medical doctors per year even though it only needs about 600. I'm sure you could attract some of these.

 
At 4/18/2010 11:06 PM, Anonymous Anonymous said...

Is this why I can't pronounce the names of any of the doctors out there that are taking new patients?

 
At 4/19/2010 12:42 AM, Anonymous Anonymous said...

It would be more accurate to show the number of physicians who have completed residency in the United States.

does not change the figurees concerning American trained MD's.

There is no reason the numbers should not have increased, except for the AMA guild system.

 
At 4/19/2010 6:15 AM, Anonymous tom in maine said...

The AMA also protects it's members against the invasion of retail health clinics at your local employer and super center. As the trend towards more retail clinics increase, the AMA opposition will increase to keep doctor services in a AMA doctors office.

 
At 4/19/2010 12:14 PM, Blogger Jet Beagle said...

anonymous at 12:42 am: "There is no reason the numbers should not have increased, except for the AMA guild system."

As the link I provided above shows, the annual number of U.S. medical school graduates has doubled since the 1960's.

Furthermore, medical residency programs do represent training. Any measure of growth in medical education should also include the growth in those residency programs.

 
At 4/19/2010 1:01 PM, Blogger Jet Beagle said...

A 2004 analysis of the U.S. physician workforce by David Goodman included this observation:

"During 1980–2000 the total number of physicians in the United States increased from 467,679 to 813,770, while the physician-to-population ratio grew from 207 to 296 per 100,000 people."

If the AMA is so powerful, why did it allow a 74% increase in the number of U.S. physicians?

 
At 4/19/2010 5:11 PM, Blogger Jet Beagle said...

"The American Medical Association, which supported the national health care overhaul, says a doctor shortage is no reason to put nurses in charge and endanger patients."

That doesn't mean the AMA is opposed to nurse practitioners working under the supervision of MD's. Here in Texas, physicians worked to relax the restrictions on retail clinics:

The state had very strict laws on physician supervision of nurse practitioners, who provide much of the care that's delivered in retail clinics.

"Each doctor could only supervise three nurse practitioners," explained Katharine Witgert, program manager at the National Academy for State Health Policy. "They had to be on site 20% of the time, and [physically] review 10% of the charts."

In 2009, thanks in part to lobbying by physicians and clinics, the legislature voted to ease some of those restrictions. Physicians can now supervise up to four nurse practitioners; they only have to be on-site 10% of the time; and they can conduct chart reviews remotely, Witgert said.

 
At 4/19/2010 5:12 PM, Blogger Jet Beagle said...

Link for passage in my last comment

 
At 4/19/2010 6:03 PM, Anonymous Lyle said...

One of the issues is that the current typical medical practice being one or a few physicians is extremely economically inefficient. A large group practice allows use of the Nurse Practitioner, and ancillary staff more efficiently. Small practices have outsourced to get around some of this in particular the billing aspect. Now in addition by making physicians employees then the conflicts of interest are reduced, as they get a salary and are less motivated to order addition work. (See Dartmouth study).
Further the group can use informal processes to standardize medical proceedures, or if large enough formal processes like Mayo or Cleveland Clinic.

 
At 4/19/2010 6:31 PM, Anonymous Anonymous said...

A minority of physicians belong to tha AMA. If you want Uncle Sam to provide more doctors maybe the U of Phoenix might open some medical schools for you. Why not educate them here instead of importing so many? With so many baby boomers aging we will need more physicians, nurse practitioners and physician assistants.

 
At 5/07/2010 10:55 AM, Anonymous Anonymous said...

doctors make so much because the average debt for a graduating medical student is >150k. So starting out as a resident, not a doctor, they only make ~50k/yr minus the cost of living. Then once they do become a doctor, they pay out the ass for insurance (obstetricians pay average 100k)....

long story short, graduating medical students are overworked and underpaid until they become doctors, at which point some person, who knew the risks, will have a child with a genetic disorder; after the lawyer makes 300-400k and the patient makes 1.1M, we all have one less doctor and one more rich lawyer.


(I am not a medical student or doctor, nor to I intend on becoming one...just my two cents)

 
At 2/09/2012 8:47 PM, Blogger frank said...

Perhaps consider that high cost of training in this country goes hand in hand with the high cost of medical care? Why do you assume that others are not taking the medical students to the cleaners, just as the physicians with their guild take the public to the cleaners? It is all part of a system that provides care at 1 1/2 to 1 2/3 the cost of equivalent systems. No I am not talking about England, they are under funded, I am talking about Germany, France, Norway, the Swiss, etc. Ask a citizen from such a country if they want a system such are ours. Don't hold your breath waiting for a yes answer. Problem is that a slight majority of Americans have excellent health care, having slept though Econ 101 they live under the delusion that the Employer pays for it, and they just figure "I got mine". It will probably take some hard times where enough of the population falls though the cracks and experiences what about 40% experience now, before things change.

 

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