Health-Care Reform and the ‘Doctor Shortage’

Health-Care Reform and the ‘Doctor Shortage’

UWE E. REINHARDT for the New York Times

“Doctor Shortage Likely to Worsen With Health Law,” read the alarming headline of a recent article in The New York Times.

The article cites a study by the authoritative Association of American Medical Colleges, according to which by 2025 the nation’s demand for doctors active in patient care will be 916,000, while the projected supply is 785,400. The report thus anticipates a shortage of 130,600 patient-care doctors, of which about half represent primary-care physicians.

These figures assume that the Affordable Care Act of 2010 will be implemented as intended. According to the Times article, the association has estimated that the extension of health-insurance coverage under the new law to slightly more than 30 million otherwise uninsured Americans will increase the doctor shortage by 30,000 for any future year, beginning in 2015.

That would double the projected shortage of doctors in 2015, to about 60,000 from a shortage of about 30,000 and would raise the shortage in 2025 from 100,000 without the act to 130,000 after full implementation of the act.

Opponents of the health care law see in these numbers one more useful piece of ordnance. In this case the protest appears to be that we, the well insured, should not be asked to share already scarce health care resources with millions of currently uninsured Americans now adding their claim to these same already scarce resources.

Sometimes this critique is styled as concern for the poor, on the strange theory that having no insurance coverage and ability to pay for care is better than having insurance coverage but having to wait for a doctor’s appointment to get non-emergency care.

At its extreme, this argument is amplified by the prediction, reportedly based on opinion surveys, that large numbers of practicing doctors will hang up their shingles in despondent response to the law.

It is probably much easier, however, to talk in an opinion survey about quitting than it is actually to walk away from net practice incomes that even at their lower ranges place American doctors among the top 5 percent of families in the nation’s income distribution. That place is unlikely to change under the health care law.

Would all these disillusioned doctors find lucrative employment in the already shrinking financial sector, the only other industry in which they could assuredly garner such high (or even higher) incomes, as some people with medical degrees now do?

Be that as it may, a more fundamental question is what do we mean by a “doctor shortage”? How is it defined and measured?

Consider the doctor-to-population ratios we see across the United States. The chart below provides s snapshot (charts exhibiting these ratios for all states are also available.) Similarly wide dispersions of the ratio prevailed decades ago across roughly the same states, albeit at lower levels for each.

Take Massachusetts, which for decades has had the second-highest doctor-to-population ratio in the nation, after the District of Columbia. One would imagine that residents of that state would consider themselves comfortably well endowed with doctors – perhaps even excessively endowed.

Not so.

An Internet search for “physician shortage Massachusetts” brings up recent articles with dire forecasts of a looming shortage in that state. They note ominously that RomneyCare, the state-based cousin of and model for ObamaCare, has overburdened an already taut health care supply in Massachusetts.

Nationwide, and in Massachusetts, the doctor shortage is said to be most acute in primary care, a lament that is decades old. Curiously, society’s response to that perception has been to let the incomes of primary-care doctors fall relative to specialty incomes.

Although the net incomes of primary-care doctors still rank comfortably in the top 5 percent of income distribution, primary-care doctors have long been and remain the lowest paid of all medical specialties. How can we explain this?

Either Americans are insincere in their lament over the shortage of primary-care doctors and deep down do not value their work as much as they say, or they have forgotten that rudimentary tenet of basic economics: you get what you pay for.

(To its credit, the Affordable Care Act does call for raising the fees paid primary-care doctors under Medicaid to the typically higher level of fees paid under Medicare, to lift the relative incomes of primary-care doctors somewhat. But it is a small gesture and, in any event, will take years before that has any effect on the relative supply of these doctors.)

Leaving that puzzle aside, the chart above raises another series of questions:

1. If, as is said, Massachusetts does not have enough doctors to care properly for the state’s residents, what about all the other states in the union? For example, are the governors and legislatures of California and Ohio reckless in letting their populations languish with those states’ much lower doctor-to-population ratios, not even to speak of Arkansas and Texas?

2. Should these states’ now lower doctor-to-population ratios be raised to the Massachusetts level and, indeed, above it, to offer state residents a fully responsible health care delivery system, now and in the future?

3. How much would it cost to move the rest of the United States to the Massachusetts level?

4. Or could there be something inefficient in the way Massachusetts doctors operate?
I will contemplate these questions, as I hope you will, and I look forward to your comments.

In the meantime, let me note that I am not the only Doubting Thomas on this issue. Jonathan Cohn of The New Republic has remarked on it, as has Eugene Steuerle in his series of briefs “The Government We Deserve.”

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