Doctor Shortage, the Next Pandemic

According to the AMA, in many communities around the United States, there is a physician shortage, which presents a serious health care problem. For a host of reasons, more than twenty million people are affected by the inability to access quality medical services. While the premise of a popular television show, “Northern Exposure,” alluded to this very predicament some time ago, most viewers were likelier caught up in the relationships between the quirky inhabitants of Cicely, Alaska instead of pondering the very real implications for those without access to a qualified doctor.1

Similar to the circumstances in which the main character, Dr. Joel Fleischman, upon graduating from Columbia University medical school (which he attended on a scholarship from the state of Alaska), finds himself assigned to be the General Practitioner of a tiny Alaskan town in order to pay for his education, “medical schools have adopted a selective medical school admission policy to enhance a primary care choice in underserved communities.”2 The reality, though, is that while some students eventually practice in underserved communities, others do not.

Limited access to medical care is not always because doctors are unavailable. When ill, people who live in urban areas are sometimes unable to travel on a crowded bus or take other forms of mass transit in order to receive medical care.3

Other reasons creating an inability to meet the demand for physician services include population growth, a larger number of people living beyond age sixty-five and needing the most services, doctors working fewer hours, some specialty areas, such as ER, are more attractive because of their less demanding schedules (primary care is more time-intensive), and our supply of physicians from U.S. medical schools is not growing.4

However, the reason which might cause the greatest concern is that there are several states which do not cap non-economic damage awards in medical negligence cases, which has created sky rocketing insurance premiums for medical providers. Many doctors refuse to practice in states like Nevada, Pennsylvania, Ohio, Oregon, Illinois, and Wisconsin, which make it more difficult to grow a financially lucrative practice without having to work twelve-hour days to generate more income to cover these additional insurance costs, or in which their careers can be jeopardized by settling in sometimes unwarranted lawsuits.

‘“When there’s a potential for an enormous jury award, of which trial attorneys may receive one-third or more, lawyers may be more willing to take a chance on a case involving a sad outcome, whether actual negligence was involved or not. “Defending these extra suits will surely tax our health care system because they will lead to higher medical liability premiums,” said Susan Turney, MD, who is Executive Vice President/CEO of the Wisconsin Medical Society.5

According to a survey taken by The American Hospital Association, there are seventeen “crisis states,” so defined by their legal and legislative environment. They experience difficulty with both recruiting physicians and with finances and operations. Hospitals blame increased professional liability expenses for lost physicians, reduced coverage in their emergency departments, and ability to provide obstetric services. As a result of an inability to recruit enough medical school graduates to fill their OB/GYN residency slots, hospitals in Pennsylvania are interviewing a greater proportion of residency applicants from international medical schools, whose level of education is much harder to ascertain.6

“A study published in early July [2003] by the U.S. Department of Health and Human Services, Agency for Healthcare Research and Quality (AHRQ) found that states with caps on noneconomic damage awards or total damage awards in malpractice cases benefit from about twelve percent more physicians per capita than states without such laws.”7

In states without caps, there are longer wait times for some medical services, such as colonoscopies, and available specialists and general practitioners can’t always accept new referrals because of their heavy workload.

It might seem logical to just graduate more doctors to help meet the growing demand for them, but the number of applicants is dropping. Also, many medical school applicants are forced to attend foreign medical schools because there are only 126 accredited medical schools in the U.S.

“There have been two newly accredited schools since 1980: Mercer University School of Medicine in Georgia, and Florida State University College of Medicine. That’s an annual increase of less than 0.1 percent–an order of magnitude smaller than the U.S. population growth rate of about .9 percent, according to the 2002 CIA World Factbook.”8

Alison Stewart speculates in Consumer Health Journal that one reason contributing to the shortage of medical schools located in the U.S. stems from the fact that they are so tightly regulated, such as requiring accreditation by doctor-run organizations like LCME, which is jointly run by the AAMC and the American Medical Association.

In addition to this, “It costs quite a bit to start a new medical school” said Dr. David Stevens, vice president of the medical school standards and assessment for the AAMC, and current secretary of the Liaison Committee on Medical Education, or LCME, the group in charge of accrediting new medical schools.”9

Furthermore, it is partially because of costs associated with being able to meet these regulations, that no foreign school has been able to create a campus in the United States and that existing schools find it difficult to expand their operations; they are seemingly unable to meet all the conventions which must be satisfied without putting their existing accreditation in jeopardy.

It is the opinion of George Howley, the 1999 director of Casper, Area Economic Development Alliance, that the reason for such resistance to Ross University, based in the Caribbean, establishing a campus in Wyoming was because “doctors are opposed to the potential competition, not to the supposed risk of lower-quality care.” He further explained the reasoning was “to protect the income to the doctors.”10

The litigation surrounding the practice of medicine, a shortage of doctors, and population growth all have contributed to the changing face of medical care. One result of the increased liability risks faced by doctors is what is referred to as “Managed Risk Medicine” which can result in “ordering superfluous tests or choosing treatments based on their likelihood to lead to a malpractice lawsuit.11

Additionally, when the FDA delays approval of new products, it has the effect of reducing their potential profitability, potentially influencing pharmaceutical companies to focus on refining previously approved products instead of investing in new ones.12

An online publication called Advantage, an industry brief on health care, lists a multitude of ways in which the delivery of medicine is changing in order to become more cost effective, easier to access, and streamlined. The following are just some of the interesting developments.

–Stores such as CVS, Target, Cub Foods, and Wal-mart are testing non-urgent care clinics, staffed by physician extenders (physician assistants and nurses), to treat minor conditions such as colds and sore throats.

–Individuals can store and manage their own electronic medical records online or on a Medic Alert e-Healthkey, which is a key fob that both controls access to network services and information and is a USB flash drive patients can carry with them.

–For a fee, medical billing advocates can help patients decode their hospital/ medical bills and suggest ways to make insurers cover out-of-pocket charges and fight hospital overcharges.

–Employers are offering preventive health screenings at work, such as blood pressure checks, cholesterol tests, and online health screenings. They are also offering wellness seminars.

–The AAMC proposes raising medical school enrollment by 15 percent over the next 10 years, or 2,500 new medical school graduates each year.

–Physicians groups have begun buying their own medical facilities, such as “specialty hospitals, ambulatory surgery centers and diagnostic imaging centers in a bid to gain greater control of their practices and to provide alternate revenue streams in an increasingly regulated industry.”13

–Consumer-directed health plans are being offered by more and more employers. In such plans, employees have the freedom to see any provider, but have the benefit of lower out-of-pocket expenses by using preferred providers.14

Consumer-Driven Health Plans A Health Care Reimbursement Account (HCRA) or flexible spending account “is a tax-exempt account funded by an employee or employer that the employee uses to pay health care expenses. Employees cannot withdraw cash from an HCRA to pay for things other than health care. The employee decides in advance how much money to put into the HCRA and loses any unspent money in the HCRA at the end of the year. This creates a “use it or lose it” incentive for higher health care spending toward the end of the year and prevents employees from using the account to save money.”15

Employee contributions to a Medical Savings Account (MSA) “are exempt from federal income tax, social security tax and (in many states) also state income tax. MSAs are accompanied by a high-deductible health insurance policy, not a generous low-deductible insurance policy. MSA funds that are unspent at the end of the year ‘roll over’ to future years and are not lost. MSAs allow individuals to withdraw funds for purposes other than health care (after payment of taxes and a fifteen percent penalty). MSAs move with an employee if he/she changes employers.”16

Health Reimbursement Arrangement (HRA), “are not taxed, must be used for substantiated medical expenses, are accompanied by a high-deductible insurance policy, and accumulate unspent money for future years. The IRS guidance also says that employees can use HRA funds for health care after leaving an employer, but this is still evolving. Some HRA plans create virtual accounts in which payments for health care are controlled by an employee, but the money actually stays with the employer. In these situations, unspent account money may stay with the employer if the employee leaves.”17

Experts predict more than forty million health savings accounts (HSAs) will be established in the next ten years, making them the most popular form of health care financing available. With an HSA, workers under age sixty-five can accumulate tax-free savings for lifetime health care needs if they are part of a qualified insurance plan (one with a minimum deductible of $1,000 for individuals and $2,000 for families). Individuals with self-only policies can set aside up to $2,600 in their HSA, while families can set aside up to $5,150 a year. Health Care News reported that major drawbacks to the accounts include high deductibles, higher employee risk than with other plans and lack of consumer education about the accounts. It has also been determined that thirty-five percent of patients with an HSA avoided obtaining care due to cost compared to seventeen percent of patients with traditional health insurance.18

Health Savings Security Accounts (HSSAs), “could be accompanied by a high-deductible insurance policy (minimum of $500 for individual or $1,000 for family coverage), but need not be accompanied by high-deductible insurance if an individual is currently uninsured.”19

In addition, “HSSAs would allow an employer, individual (employee), or both to make tax-deductible contributions to the account of up to $2,000 per year for individual coverage or $4,000 per year for family coverage. Money could be withdrawn from an HSSA for purposes other than medical expenses after payment of income tax plus a fifteen percent penalty. The tax deductibility of contributions to HSSAs decreases for individuals with incomes over $75,000 and families with incomes over $150,000. When an account holder turns sixty-five, they can withdraw money from an HSSA for non-medical purposes after paying taxes but no fifteen percent penalty. HSSAs would be portable when an employee changes employers.”20

In the field of health insurance, a fixed amount paid to an organization (such as an HMO) to provide all types of care for an individual is called “capitation” payment. A fixed amount paid to one type of provider (such as a Pediatrician) to provide only the care need from that type of provider is called “sub-capitation” payment because it only covers a subset of needed services. With a Customized Sub-Capitation Plan (CSCP), an individual is given a choice among providers of each type and is shown the sub-capitation premiums that each provider charges. The customized premium that the individual pays is the sum of the sub-capitation rates for the providers the individual selects.

Possible advantages of CSCPs include: flexibility in selecting providers based on quality, prices, and personal preference; and relatively complete insurance coverage without the out-of-pocket coverage gap common among most Consumer Driven Health Plans.21

Association health plan legislation continues to be introduced. Senate Bill l955, Health Insurance Marketplace Modernization and Affordability Act of 2005, would amend “the Employee Retirement Income Security Act of 1974 (ERISA) to provide for the establishment and governance of small business health plans, which are group health plans sponsored by trade, industry, professional, chamber of commerce or similar business associations that meet ERISA certification requirements.”22

Although the doctor shortage raises great concern, the market seems to be responding to the rising health care costs with innovative solutions, which may help alleviate the additional financial stress placed on the consumer. If the AAMC truly has the power to help boost medical school graduates by fifteen percent over the next ten years, that will help. However, until litigation caps are imposed in the seventeen “crisis” states, there will still be shortages of doctors in areas where medical liability premiums discourage establishing a practice.

Your post was, in my opinion, a solid foundation for this point: we already have a good doctor shortage. Not in the sense of having a shortage of people who are certified to figure out antibiotic dosages, or administer shots or the like; we may or may not have enough of those people, with or without MD after the name. We do not have, not by a long shot, near enough people who can do the real work of doctoring. We do not lack for people who can calculate an antibiotic dosage for a red, swollen leg, for example, but we do lack people who can be relied on to see a swollen leg, and to accurately diagnose infection vs. deep vein thrombosis vs. muscular rupture vs. heart failure vs. tumor vs. lymphatic filariasis vs. burn vs. extravascular hematoma vs. other. Ascertaining the correct diagnosis is important, because the treatments for some of these conditions can increase the risk of death posed by others of those entities.

Some people think that such differentiation is easy because they’ve never had to do it. It’s those people, I wager, who think we can increase the supply of real doctors simply by increasing the number of people with “MD” after the name. It’s also those people, I wager, who believe that being a doctor consists solely of calculating antibiotic doses. That point is why I thought your post was such a good foundation for this post.

Some people think that differentiation of different diseases is easy simply because they’re good at it, and it’s hard to believe that others don’t have the same ability. A few months of clinical practice, and routinely being presented with people who’ve been obviously misdiagnosed and received counterproductive or dangerous “treatments” will disabuse anyone of such an idea. An afternoon spent reading studies of misdiagnosis rates may have the same effect, but really does not have as much impact.

What we really lack is not people with the credentials to be a doctor, but with the skills to be a good doctor. There may be a small shortage of the credentials, but handing out more of the credentials is probably pretty easy. There is a gigantic shortage of people with the skills / knowledge / intelligence to really be good physicians, and fixing that shortage is, I believe, not simply a matter of opening new medical schools, nor PA schools nor RN schools. The older I get, the more I realize that good doctors are mostly born, and only partially made. Regardless of how many schools, training programs, certification programs, or other we have, the fact seems to be that there are only a certain amount of potential good doctors in every generation, and there’s already plenty of spots for those few. Certainly, better identification of potential good doctors might be a good idea, but the number of raw med school spots is not the limiting factor.

Thing is, the people who could be good doctors generally don’t have to put up with the bad parts of the medical system in order to make a living. The existence of abusive training programs that encourage or require arguably criminal abuse or fraud to graduate is already a disincentive to become a doctor. Tacking on post-training lawsuits is another disincentive. Risk of infection, risk of violence in the workplace (visit your local large ER some night), and more are all disincentives. Paperwork requirements are both a disincentive to go into medicine at all, and, because they take up so much time, an effective reduction in the amount of actual medical care that can be delivered by the people who do decide to become doctors anyway. Potential good doctors see these things, and some decide to to something else.

If we want more actual good doctors, the only possible way is to make medical training and practice more appealing. If we do that, then the future will have fewer excellent financial analysts, lawyers, engineers, mathematicians, and others, but we can have more good doctors. Simply increasing the supply of MD / RN / PA licenses is not enough.

We would not need health insurance reform, if the politicians would focus on increasing the supply of health care by eliminating the doctor shortage.

We don't need major health insurance reform. We need major tort reform, since insurance and 'defensive medicine' are a major piece of the excessive price of health care. Take away the cost of frivolous lawsuits and the price of medical care would drop significantly.

The only reform needed on the insurance side might be to block states from placing enormous restrictions on insurers as to what options they must or cannot offer. In some states, you cannot buy simple catostrophic medical insurance, because of state minimum coverage requirements. For example, Maryland requires alcoholism treatment be covered by insurance, and also requires coverage for "family planning" and hearing aids for minors. Now, if you're an unmarried male that doesn't drink, has no children, and isn't planning on siring a family, then you're being forced by Maryland to pay for coverage outside of what you need or want.

re: If France can do that without sacrificing quality, then I don’t see why we can’t.)))

See above. Monday am quarterbacking--you gloss over the complexities.

If we have twice as many docs, there will be no decrease in costs. What doctors earn in fees is a tiny part of your costs. What costs is hospitalization, the infrastructure.

Primary care physicians are not even involved any more in hospitalized patients. That's generally for the "hospitalists"--largely foreign docs which are hired by the hospitals to work in house. Having more primary care physicians is a desirable thing, but what do you pay for an office visit? $75? What does it cost to have a gall bladder removed....$15,000. The surgeon gets a small fraction of that.

I don’t think you can say that what the cost of hospitalization is. When you get the bill, the itemization means only one thing: That is what the hospital thought they could bill for a particular item without drawing the attention of the gatekeeper. For example, if the bill says that they are charging you $50 for cotton balls, chances are that it did not really cost $50 for cotton balls. Chances are that they are trying to allocate to “cotton balls” other expenses that the gatekeeper won’t let them charge. You can look at the total bill, but even that does not get you the true cost because some of the expenses are billed directly by the physician and other providers.

All I can say is that this idea that reducing the number of doctors will reduce costs has not worked. They’ve been doing it for 50 years or more, and the problem has become progressively worse. Basic economics tells you that if you increase supply, the price goes down. I’m aware that the health care industry has argued that supply and demand works backwards in the health care industry, but history has not borne out their claims, and that is why we now have a catastrophe as a result of their efforts to reduce the number of doctors. And it’s not just the number of doctors. It’s also the number of nurses, and health care professionals of all kinds. Even physical capital must first go thru a certificate of need bureaucracy before it is permitted.

This is what happens when you let government run an industry. And that is why I commonly point out that the problem with the health care industry is not that we don’t have enough regulation. The health care industry is one of the most heavily regulated industries in the nation. It’s already pretty much run by the government. It’s certainly not an industry controlled by free market forces. To the extent that the industry does not obey the laws of economics, it is generally because of the heavy-handed regulation. So it’s ironic that those who oppose market reforms would use the failure of the industry to respond to free market stimuli as an excuse for opposing market reforms.

If effective doctors are born and not made as you suggest let’s just abandon hope, eh? BS. And yes diagnosis is hard.

That said, I’d like to use an analogy from a troubled industry to make my point. Car manufacturing. Seems far off from medical practice? It is, but the point is still the same. Government regulations, tort laws, union politics and short run optimizing management combined to destroy the industry in the US. IF the car companies had more profits, they could have invested in better parts and engineering which would have made better, longer lasting cars. Instead the short run profit maximizers killed the industry. And the politicians stuck us with the costs.

How to extend this analogy to medicine? Reduce regulations which limit physicians treatment options and drive up costs. Pass (as the state level, this ain’t a federal issue) tort reform laws so that hard working and otherwise honest physicians aren’t sued into poverty for taking reasonable risks - and fraud isn’t covered by this. Train more paraprofessionals to take the burden off MDs - let them do the high value add stuff. End the deductability of medical insurance as a business expense and institute medical savings accounts to reduce the role of insurance companies in paying for medical services and in mandating care. That way we apply market forces to a) increase the supply of medical workers to cut costs (and no the demand for medical services does not have a flat or positive slope) b) take away incentives to practice defensive medicine (which would otherwise drive up costs) and c) cut out the middlemen in the transaction.

Or we go for single payer medical and drive the country into bankruptcy.

Spoken like someone who wants to up the price. 95% of everything is routine, be it medicine, mechanical problems, or software. It’s only in the 5% where a professional can make a difference over a technician. With one exception, EVERY doctor I’ve ever encountered was a cook-book technician with a title.

And in my family, we NEEDED a good doctor, and none we could find did more than scattershot diagnostics, while my daughter’s condition worsened. Only by my wife’s and my research, did we identify the problem, point out the correct diagnostic test, and actually get the problem fixed.

It took two years of our research to FIND it, and yet 5 separate highly-paid specialists, including those at 2 major teaching hospitals didn’t find it. We talked a nurse-practitioner into ordering the test. . .and there it was.

Our case wasn’t “interesting” enough to the real experts to take it, and the “professionals” had no clue.

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