Monday, January 24, 2011

There's A Coming Doctor Shortage. But Why?

From a recent Wall Street Journal editorial by Dr. Herbert Pardes, president and CEO of New York-Presbyterian Hospital:

"The doctor shortage was fostered in 1996 when Congress capped the number of new doctors Medicare would pay to train, a practice that continues to this day.

Health-care reform will add an estimated 32 million people to the ranks of the insured, driving them to seek medical attention that in the past they may have avoided due to expense. The aging population will also create much greater demand. The number of seniors who need more medical care is expected to soar to 72 million by 2020—nearly double today's number.

According to a 2010 report by the Association of American Medical Colleges, the increased demand means that our nation will need an additional 130,000 doctors, both general-practice physicians and specialists, 15 years from now. That's about 20% more doctors than we have currently.

Right now we train roughly 16,000 doctors a year. To keep pace with demand, this nation will need to train an additional 6,000 to 8,000 each year for the next 20 years. If we increased the number of training slots today, it would take seven to 10 years for the new doctors to see patients (four years of medical school, plus three years of residency and additional specialty training)."

MP: The chart above shows that the number of medical school graduates peaked at about 16,000 per year in the early 1980s, long before any Congressional cap of Medicare funding in 1996 for training doctors. Since the early 1980s, the U.S. population has increased by almost 80 million people, a 36% increase, which has taken place at the same time that the growth in the number of medical school graduates has been near zero.

Why is it that we only hear about current or pending doctor shortages, but we never hear about shortages of other highly-trained professional like lawyers, engineers, computer programmers, Ph.D. history or political science professors, architects, economists, accountants, etc.  For some professionals like lawyers and history professors, we actually hear about huge and rising surpluses.  On the other hand, we hear all the time about the proliferation of for-profit universities like the University of Phoenix, so the market for private, for-profit education is expanding and growing nationally to offer education for nurses and other medical careers. 

Q: What is it about the medical profession that prevents it from supplying an adequate number of doctors to meet the rising demand, when every other profession seems able to accomplish that outcome?   Why has the number of medical school graduates been basically flat for 30 years?  I'm guessing that there must be restrictions that prevent the number of medical schools from increasing, but I'd welcome comments about this.

And whatever those restrictions are that have kept the number of medical graduates fixed at the same level for thirty years in the face of a rising and aging population, they have to be a major factor in the rising costs of medical care. If we had artificially restricted the number of auto mechanics or hair stylists at early 1980 levels, we'd be complaining today with the rising costs of car repair and hair cuts. 

26 Comments:

At 1/24/2011 11:05 AM, Blogger morganovich said...

i'm just speculating here, but it may be worth looking at the board certification process.

it's potentially possible that it is quotas at the boards level that throttle demand for med students.

just graduating from med school is not enough. you have to become board certified, and that is where the guild really flexes its muscles.

i can tell you that radiologists, for example, are getting pushed out on board certification and that the new policy will extend their "residency" by a couple of years, in effect making them indentured servants for that period while they wait to take boards.

i've been looking at a teleradiology business model to take advantage of this.

 
At 1/24/2011 11:24 AM, Blogger Buddy R Pacifico said...

From an article in the New England Journal of Medicine via Bloomberg:

"In 1965, when Congress enacted the legislation that created Medicare, it assigned to the program functions that reach well beyond its basic mission of providing health insurance to an eligible population..."

"At the time of enactment, Congress determined that educational activities in teaching hospitals should be regarded as a reimbursable expense by Medicare until “the community [society at large] undertakes to bear such education costs in some other way"."

The federal government got involved thus, medical school funding and physcian residency training is largely a function of Medicare funding and policy.

 
At 1/24/2011 11:46 AM, Blogger Sean said...

Between the government, the health "insurance" industry, and the AMA, there's very little free market process involved in healthcare at all, to the great detriment of us all.

 
At 1/24/2011 11:58 AM, Blogger juandos said...

The Medicus Firm Physician Survey: Health Reform May Lead to Significant Reduction in Physician Workforce

'The results from the Medicus Firm survey, entitled “Physician Survey: Health Reform’s Impact on Physician Supply and Quality of Medical Care,” were intriguing, particularly in light of the most recently published career projections from the Bureau of Labor Statistics (BLS). The BLS predicts a more than a 22 percent increase in physician jobs during the ten-year period ending in 2018. This places physician careers in the top 20 fastest-growing occupations from 2008 to 2018. Meanwhile, nearly one-third of physicians responding to the survey indicated that they will want to leave medical practice after health reform is implemented'...

 
At 1/24/2011 11:59 AM, Blogger juandos said...

The Medicus Firm Physician Survey: Health Reform May Lead to Significant Reduction in Physician Workforce

'The results from the Medicus Firm survey, entitled “Physician Survey: Health Reform’s Impact on Physician Supply and Quality of Medical Care,” were intriguing, particularly in light of the most recently published career projections from the Bureau of Labor Statistics (BLS). The BLS predicts a more than a 22 percent increase in physician jobs during the ten-year period ending in 2018. This places physician careers in the top 20 fastest-growing occupations from 2008 to 2018. Meanwhile, nearly one-third of physicians responding to the survey indicated that they will want to leave medical practice after health reform is implemented'...

 
At 1/24/2011 12:09 PM, Blogger Anonymous Bosh said...

The market was already moving to solve the health care "problem" when Big Brother stepped in...

I work in an overpaid industry (in which, even here, I am overpaid); yet my firm recently switched to a "high deductible" plan (although they thoughtfully funded fully half of the $5000 family deductible via a contribution to my HSA).

In any case: family member is sick, needed to visit a doctor. We could have called our PP (primary physician) out or heretofore standard Family Practice--and waited at least a couple of days for an appointment (Oh, and this was for yesterday, Sunday...).

Instead, we availed ourselves of one of the new Instant Clinics at our local big-name pharmacy.

No lines, no waiting, the --nurse-- will see you now, use an "instant" test to diagnose, and your prescription is ready before your visit is finished.

And it was cheap.

Just like Jiffy Lube, entrepreneurs (even big-biz entrepreneurs) will step in to claim the "low end" or "underserved" market space. I, for one, look forward to it (and the abolition/replacement of ObamaCare).

 
At 1/24/2011 12:20 PM, Blogger Evergreen Libertarian said...

This won’t answer your question but I’d say a shortage of MDs is probably good. We need to open the market to more nurses and especially midwives. Midwives generally have better outcomes than MDs and costs less. Besides when the doctors went on strike in L.A. some years ago the death rate declined.

 
At 1/24/2011 12:34 PM, Blogger HaynesBE said...

The link to the N EngJ Med article is a blind end. Buddy R Pacifico--Could you provide the title and author?

 
At 1/24/2011 12:45 PM, Blogger Michael Hoff said...

My guess:

1. It costs too much to get a degree;
2. It takes too long to get a degree, and if you're that smart, you can be making good money somewhere else instead of doing a painful residency;
3. Once you get the degree, society sees you a walking, talking target of easy money via a malpractice suit, and;
4. The government is way too involved.

 
At 1/24/2011 12:47 PM, Blogger Buddy R Pacifico said...

Haynes BE, et al, sorry for the link not being available.

Here is the link to Bloomberg article cited.

The NEJM article author is John K. Iglehart, August 7, 2008. The link is http://www.nejm.org/doi/full/10.1056/NEJMhpr0803754. This may be able to accessed via Google, Bing or DuckDuckgo search possibly.

 
At 1/24/2011 1:04 PM, Blogger HaynesBE said...

Buddy....thanks for the links.

 
At 1/24/2011 2:02 PM, Blogger misterjosh said...

I bet Uncle Milty knows!

 
At 1/24/2011 2:55 PM, Blogger Mike said...

Last time I saw a doctor I was having my appendix taken out....4 years ago.
One reason this may not be as big a problem as it seems is the number of nurse practitioners has increased by 40% over the last 5 years (according to estimates by the American Academy of Nurse Practitioners).
I go to one for run-of-the-mill stuff and she's great.

 
At 1/24/2011 3:16 PM, Blogger Jet Beagle said...

When Congress reduced the portion of Medicare funds allocated to medical residency programs in 1997, it was supported by a research paper from a cmmittee of the Institute of Medicine. From an article about that 1996 report:

"The report says that finding a perfect balance between physician supply and societal needs is probably an unachievable goal. However, the prospect that an 'appreciable surplus' of physicians will arise in coming years means that action is needed now to bring the demand and supply into better balance."

That Medicare rather than a free market funds medical residency training is, of course, where the problem lies. But Congress compounds the problem by relying for funding guidance on the bureacracy it created in the Institute of Medicine (part of the national Academy of Sciences)

 
At 1/24/2011 3:35 PM, Blogger Mr. Econotarian said...

What this graph does not convey is the total number of doctors in the US, only US medical school graduates.

There are plenty of foreign-schooled doctors in the US, some of them American citizens.

Ironically, even a fully-licensed doctor from Europe still needs to re-do their residency in the US to become licensed, which makes little sense.

According to the 2010 Statistical Abstract of the U.S. Census Bureau, there are 661,400 physicians and surgeons in the United States in 2008.

The Oct. 21 issue of JAMA estimates that the United States has 788,000 active doctors, and by 2020 there will be 957,000.

The US does not stand out as having significantly more or less doctors per capita than other OECD nations. However US doctors and nurses are currently paid about double the OECD average (no doubt "health care reform" may change that).

It should also be noted that many US doctors have their residency paid for in other ways than from Medicare.

 
At 1/24/2011 3:40 PM, Blogger Mr. Econotarian said...

Oops, it turned out I was misremembering a study. The US does have a lower number of practicing physicians per capita than most OECD countries (for example: US: 2.4/1000, France: 3.4/1000, Belgium 4/1000).

 
At 1/24/2011 3:54 PM, Blogger Doug said...

This comment has been removed by the author.

 
At 1/24/2011 3:55 PM, Blogger Doug said...

I would imagine the AMA is protecting their monopoly. If they really cared about controlling health care costs, they would be lobbying for more resident programs.

 
At 1/24/2011 4:42 PM, Blogger Jet Beagle said...

Doug: "If they really cared about controlling health care costs, they would be lobbying for more resident programs."

I see no reason to expect physicians to spend money for a cause which is not in their best interests. So I have no problem with the AMA not caring about controlling health care costs.

Health insurance companies, on the other hand, face the pressure of government controlled insurance premiums and supply-limited medical care prices. So the health insurance companies should be lobbying for expanded residency programs.

The underlying problem, though, is reliance on government planners.

 
At 1/24/2011 5:15 PM, OpenID Sprewell said...

The answer was a simple google search away: despite rising numbers of applicants, the AMA restricts supply by refusing to authorize new medical schools. Thank our wonderfully idiotic Congress for putting the foxes in charge of the henhouse. I talked to a med school student years ago and he told me the hard part was getting into a med school: he claimed the actual education was fairly easy once you were in but the problem was getting one of the schools to let you into the cartel. Like all such cartels, it only works until new tech comes along: the medical profession will soon be devastated by medical decision software and online consultations with foreign doctors. The same way many newspaper/magazine journalists and radio DJs are now out of work, with a lot more about to be sacked, the ranks of doctors will soon be decimated.

 
At 1/24/2011 5:28 PM, OpenID Sprewell said...

Hmm, didn't realize that was one of Mark's old posts till after I linked it. :) Here's another page with more info.

 
At 1/24/2011 8:40 PM, OpenID richardrider said...

As the hassle of delivering medical services is combined with the planned reduction on doctor pay, it is no surprise that doctors' interest in staying in medicine is waning.

The government "plan" is to cut MD compensation to as little as $20/hr net, while restricting supply. Brilliant!

One truly tragic side note -- far too many bright people who COULD have been doctors, engineers or other productive human beings have instead become attorneys. Law is largely a zero sum profession, stealing from some to enrich others, with as much as a third going to the attorneys. I've seen far too many talented people go into law -- often with high ideals coupled with images of big bucks.

Soon too many find themselves in the tort racket, harming our society while squandering their talents. Truly sad.

 
At 1/25/2011 4:29 AM, Blogger juandos said...

Thanks sprewell for the links...

Some interesting stuff there...

 
At 1/25/2011 1:17 PM, Blogger VangelV said...

You think the US is bad now. Wait until Obamacare passes. Up here I go to my local grocery store if I have a problem and have a chat with the manager. She is an excellent doctor who trained in China but is not permitted to practice in Ontario. Or I head over to a neighbour who is also a doctor but works as a nurse because the CMA does not recognize her foreign training. If there is something that really needs attention she is good at being able to arrange for me to see a specialist without waiting for weeks. If it is something minor she suggests what tests my family doctor needs to ensure that I get. The system works well and my 'payment' is usually an exchange of child care duties. I take her kids to school when the school busses are not running and her husband has already gone to work, take her son to movies, etc. In a highly regulated world you really need to figure out ways around the constraints placed by the system.

 
At 1/26/2011 10:18 PM, Blogger Tarun Agnani said...

One greater factors against the medical field is the malpractice insurance. My sister--a cardiologist--and her husband--a pediatrician--often complain to me.

 
At 1/28/2011 9:06 AM, Blogger sethstorm said...

Why is it that we only hear about current or pending doctor shortages, but we never hear about shortages of other highly-trained professional like lawyers, engineers, computer programmers, Ph.D. history or political science professors, architects, economists, accountants, etc.

Some of those professions don't really have shortages, such as those with programming and IT.

 

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