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Posted at 11:55 AM ET, 12/23/2010

Left-right agreement on health-care reform?

By Ezra Klein

Last night, Amanda Carpenter, an aide to Sen. Jim DeMint, tweeted a link to this New York Times story and said, "90,000 doctor shortage predicted by 2020. Only 18,600 new docs matriculate per year. Let's welcome docs, not block 'em."

Co-signed! One of the big reasons that health care is so expensive in this country is that doctors make so much money. And one of the reasons that doctors make so much money is that the supply of doctors is artificially constrained. The profession sharply limits the number of doctors who can graduate from medical school each year, and as the New York Times story shows, there's an ongoing effort by the profession to make it harder for foreign-trained doctors to apprentice and then practice in America.

This doesn't make doctors evil. Taxi drivers play this game, and so do barbers, nail salons, and many other professions. And many doctors complain that their high incomes mask crushing student debt. That's true, too. But the fact remains that opening the profession up would make medical care cheaper. And in other countries, where medical practice is less lucrative than it is here, it is still a very desirable profession, and lots of people enter it.

Moreover, as Amanda mentions, we have too few doctors for what we'll need in coming years, and the health-reform law only exacerbates the problem. You could solve that problem by allowing more foreign-trained doctors in, you could do it by making it easier for nurse practitioners to provide primary care, you could do it by increasing the number of people who can enter and graduate from medical school, or you could pick some other path. But at some point, this isn't just something we should do, but something we're going to have to do. America's doctors may be the best in the world, but they're not that great if you can't get in to see them, can't afford to see them or can't get them to spend any real time on your problems because the waiting room is overflowing.

This, however, won't be a bipartisan compromise. The two parties don't want to touch doctors. It could, however, be a left-right compromise: Conservatives should be angry about this distortion of the market, and liberals should be angry about the reduced access and high costs that it causes. Of course, that plus 2.10 will get you a cup of coffee to drink while watching your legislation die in the Senate.

By Ezra Klein  | December 23, 2010; 11:55 AM ET
 
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Comments

Wow, DC coffee is cheaper than LA! Who knew?

Posted by: randrewm | December 23, 2010 12:23 PM | Report abuse

While it's obvious that increasing the supply of doctors would reduce their average price, it's not so obvious, at least to me, that it would reduce the total cost of doctors.

Posted by: ostap666 | December 23, 2010 12:26 PM | Report abuse

Barriers to entry raise prices. Nice to see some people are finally paying attention to basic economics. Now if we could just do something about the problem.

>>This doesn't make doctors evil. Taxi drivers play this game, and so do barbers, nail salons, and many other professions.>>

Hurting the public to benefit yourself sounds evil to me. That many people do it doesn't make it any less evil.

Posted by: fuse | December 23, 2010 12:36 PM | Report abuse

My doctor found a suspicious growth and gave me a list of dermatologists to choose from to check it out. The earliest appointment I could get was in four months, by which time I would have been terminal if it were melanoma. So my doctor just excised it, as it turned out unnecessarily.

Sometimes it only takes a few weeks, but on at least three occasions recently I or members of my family have had to wait 6-9 months for specialists, and even my primary care physician is always booked solid for a month. And this is in the Boston area which is relatively teeming with doctors.

I roll my eyes when I hear arguments that if we change our health care system, waiting times will be longer.

Posted by: DavidinCambridge | December 23, 2010 12:44 PM | Report abuse

Great post Ezra! Thankfully you bring it up but not nearly often enough. Doctors make so much more here than in other countries. If we ever got to a set of rates like the small example below we'd save not millions, not billions but TRILLIONS.

http://www.health.gov.on.ca/english/providers/program/ohip/sob/physserv/b_nuclea.pdf


Then again we'd have to deal with the issue of an even worse doctor shortage and the problems that come with that. What we need to do is find a way to move very gradually to this type of setup.

and to add to fuse's point the normal liberal argument that healthcare is a "right" would serve you in the comparison of taxi drivers you use. If taxi drivers limit their supply then you have to pay more or walk a bit. If doctors do it you could be dead.

Posted by: visionbrkr | December 23, 2010 12:49 PM | Report abuse

"Conservatives should be angry about this distortion of the market"

That implies that conservatives care about distortions of the market...

... anyway, more constructively, how does this line up with the fact that supply drives demand for health services? Wouldn't it be better to deregulate certain services which by law must be performed by MD-holders? In Washington state, stitching and stitch removal has to be performed by a doctor. Couldn't this be done by any nurse, or maybe a subset of more highly trained nurses?

Posted by: NicholasBeaudrot | December 23, 2010 1:20 PM | Report abuse

Also Medicare pays for many of the residency programs, and artificially limits them as well. For dermatology there is only a couple hundred openings per year, which is why it is one of the hardest specialty fields to get into.

@Chris_Gaun
christiangaun@gmail.com

Posted by: chrisgaun | December 23, 2010 1:21 PM | Report abuse

* In Washington state, stitching and stitch removal has to be performed by a doctor. *

That's absolutely crazy. The last two stitching incidents in the ER I had were done by a medical student and a physician's assistant, respectively. They did a perfectly good job. And the last time, I just took out my own stitches myself.

Part of the problem is that certain procedures/treatments have, over time, become less expensive and easier to do. In most industries, when that happens, the level of specialization required to perform them would be lowered and performed by lower-level employees. For medical treatment, however, we seem to bump up procedures to the highest-cost professionals/specialists possible rather than seeking the lowest-cost-professionals/specialists possible.

Posted by: constans | December 23, 2010 1:30 PM | Report abuse

I always resented how the science departments in college seemed to delight in a concerted effort to weed people out of the pre-med track. You were lucky to make it past freshman chemistry, and if you survived Orgo. and still wanted to be pre-med you were one of the lucky few. My freshman roommate entered as pre-med and dropped that dream after one semester of freshman chem. The two guys directly next door to us squeaked by in freshman chem. and did not make through Orgo. To the extent the science professors (a) could speak English and (b) were not octogenarians, they were (with few exceptions) pretty ruthless.

Not saying our science curricula should be less rigorous or that students shouldn't have to face up to just how challenging a career in medicine or the sciences should be. Shouldn't we be doing more to encourage people to enter these fields and not trying to dissuade them?

Posted by: pbasso_khan | December 23, 2010 1:42 PM | Report abuse

You all have missed the most obvious point here, that if people took care of themselves they would need to use the services of the health profession much less. That alone would control medical costs; if I don't have to use a doctor, it doesn't cost me or my insurance anything. Most use of medical services is caused by diseases that are entirely preventable if people eat properly, including CVD, diabetes, auto-immune dieases, and compromised immunity among others. Doctors are fine for handling injury and trauma, but don't have much use beyond that, primarily because the medical profession doesn't have a clue about nutrition. I want a doctor to treat me if I break a leg, but the moment a doctor asks about my cholesterol it's time to leave.

Posted by: johnsonr1 | December 23, 2010 1:45 PM | Report abuse

There's another partial solution to the physician shortage.

Nurses

Posted by: tlibert | December 23, 2010 1:45 PM | Report abuse

ostap666 is right. The Dartmouth Atlas has shown that as you increase health care capacity like the number of doctors or hospital beds in a certain region, per capita health care spending and utilization rates soar w/o a concomitant reduction in fees sustained by the market.

Posted by: nathanpunwani | December 23, 2010 1:58 PM | Report abuse

Doctors don't seem to have a problem living in mansions and driving beamers and retiring young despite their student loans. So I don't have sympathy with them.

Charlie Christ supposedly tried working with state universities to increase the number of Drs graduating, but not sure of the results or even if the program got started OK.

I have no doubt politicians from both parties have worked with the AMA, or whoever, to minimize the number of DRs graduating. And to me that means any DR who works politically to limit Dr numbers are in effect working against their hippocratic oath to do no wrong.

Posted by: lauren2010 | December 23, 2010 1:59 PM | Report abuse

i'm pretty sure aaron carroll's big series on cost of health care in the US debunked the "One of the big reasons that health care is so expensive in this country is that doctors make so much money" myth.

and i'm also pretty sure ezra linked to that series on this blog.

Posted by: strobes | December 23, 2010 2:20 PM | Report abuse

A serious part of the shortage is the disincentive for young doctors to choose primary care instead of a sub specialty. When you can make many times more a year as an oncologist, cardiologist or most any -ologist, why take on the debt plus the cost of raising a family on a fraction of the income?

We need more (many more) family physicians.

Posted by: squiregeek | December 23, 2010 2:32 PM | Report abuse

strobes

You are probably right.

But drs do make good money, and they do limit their ranks for a reason.

And they do order lots of fancy expensive machines for lots of tests, either because of defensive medicine or for more profits.

And hospital charges are just ridiculous. Few people can go to an ER room now because of the fees they stick you with even for minor things.

Posted by: lauren2010 | December 23, 2010 2:36 PM | Report abuse

sorry lauren but IMO strobes is not right. I found Caroll's posts and read them. In his conclusion he states there are a number of factors including pharma, doctors, insurers, hospitals and patient behavior. IMO the only ones to take a haircut with PPACA are the two entities that have the lowest profit margins by industry. Hospitals and insurers. Doctors and pharma are doing fine.

Exactly what is the excuse or reason doctors give for limiting their ranks in the US?

Posted by: visionbrkr | December 23, 2010 3:09 PM | Report abuse

and furthermore Carroll blogs that he "was amazed to see that outpatient care represents such a large portion of total spending (41%).

http://theincidentaleconomist.com/wordpress/why-the-us-spends-more-on-health-care/


I'm not amazed at all. Who do they think owns outpatient centers that drive these costs. Mostly DOCTORS and sometimes hospitals. Its double and sometimes triple dipping. Let's get some real transparency and break out their K1's and see how they compare now to what they did 5 to 10 years ago. I'm betting its growing right about the pace of medical inflation.

Posted by: visionbrkr | December 23, 2010 3:15 PM | Report abuse

Ezra,
To really hash out this argument you can't just consider the total number of doctors and the average doctor's salary. I think the problem isn't so much the number of medical spots, as nurse practicioners and physician assistants could take on a larger burden of primary care. The problem is the limited number of spots in certain areas, like dermatology, and the fact that the best and brightest medical students are drawn the the much higher paying specialties.

Posted by: afolick | December 23, 2010 4:10 PM | Report abuse

the more I consider it the more i think adding more nurse practitioners and physician assistants will help with the access problem coming but not the cost. It is the high cost of specialists and the perverse incentives many of them get (and will get more of with PPACA) that has driven cost and will continue to do so and no amount of testing pilot programs will do much to curb that. Those that abuse the system will simply find another way to abuse it.

Posted by: visionbrkr | December 23, 2010 4:28 PM | Report abuse

"The two parties don't want to touch doctors."

That is the truth. Doctors are like Wall Street Bankers with huge Bonus - they have vice like grip on Congress. AMA is having that clout.

Why cannot Fed & States force Universities for shorter Med Programs? Otherwise no funding. Once Public Univ starts doing Private will do too. What will AMA say? They will say they will not accredit those programs. Force them by LAW then. AMA cannot be above national interests.

In India after 12th grade, you do basic Med Degree for 4.5 years and then 1.5 years internship. Add to that 2 years of Masters Degree. Here in USA to start with 4 years of graduation, then 3 years of Medical Program and then residence and so on.

Which morons are trying to tell Indian Doctors are less competent? I know very close members in family, even after specialized degrees in Medical Field from India and UK and they still find it hard to practice in USA and AMA makes life miserable.

It is discrimination and apartheid which is going on and Americans are paying the price for the same.

There are few programs (One in Central Cal., new state Univ.) which are trying to impart Medical Education in shorter period. Program is full. More Universities need to offer that.

How about Congressional hearings about this in 112th Congress? Where are our 'market forces' guys on this one? What does our new Appropriation Committee Boss - Rep. Paul Ryan - say on this one?

We are basically bringing our National Bankruptcy due to provider cost issue and still this country does not want to 'touch Doctors'. What a great job have Doctors done in PR.

Hope Ezra continues his follow up on this issue relentlessly.

Posted by: umesh409 | December 23, 2010 9:08 PM | Report abuse

Most doctors aren't really overpaid by comparison with, say, investment bankers. Increasing the supply will just increase total health spending. That's why it's important to pay for performance. Then you can increase supply.

As for foreign-trained docs, some are truly superstars. Others get in because of family connections or because they got lucky. We'd probably be better off without the latter.

Posted by: bmull | December 23, 2010 11:08 PM | Report abuse

People should never forget that real health depends how well you take care of yourself and not what health insurance you carry but I agree health insurance is important for every one. Search "Wise Health Insurance" online for dollar a day insurance plans.

Posted by: bilythompson | December 24, 2010 12:59 AM | Report abuse

This is sweet!!! major brands give out samples of their popular health products best place is "123 Get Samples" tell your friends too.

Posted by: sandrabessey24 | December 24, 2010 3:10 AM | Report abuse

I feel like I should chime in as a medical student here.

As for the constraints - yes there are many more applicants for medical school than spots available. But that's true for every single graduate program (law, business, etc) in addition to medicine. The other side of it is the resources needed to adequately train a physician. You can stuff hundreds of people into lecture halls for sure, but the clinical clerkships (3rd and 4th year) where most of the hands on training is done requires small teams and teaching hospitals that can take on that burden. Furthermore, residency training is funded by Medicare and provides a limited number of slots so you can't just throw more people into medical school without an adequate path afterwards. These constraints are structural and not a desire of the professionals to make their jobs more lucrative. There are some specialties that are highly selective but that's driven primarily by lifestyle. I'm not arguing that the supply doesn't need to increase but people need to understand that it's not as simple as "med schools need to take more people." I think we should make it easier for people to train here (probably by lowering the cost), AND make it easier for foreign doctors to move their practice here - international physicians have to repeat residency which is a waste of training resources.

I don't deny that the basic science curriculum is quite burdensome and probably doesn't select the most appropriate people for medicine (book-smart vs. people-smart). But again, med schools are rated by the average test scores of their matriculating class so there is an incentive to keep this system going. There are some notable exceptions (Mt. Sinai has a humanities in medicine program that doesn't even require the MCAT), but broader change should be considered also.

On the issue of primary care - people think primary care is easy because they because they probably don't see their primary care physician doing much during a visit (and that's probably because he or she needs to see 30 patients/day to stay afloat). Primary care is the country's entry point into the health care system - it should be taking people with MORE training, not less, and should be a highly coveted position that's competitive with the specialties if not more lucrative. These are the people that need to know about rare diseases and complications so they can start managing their patients early on. These are the people that need to earn the trust of their patients to get them to take better care of their health on their own. I think relegating it to those with less training will only make our dependence on specialties worse. There is clearly a role for NPs and PAs in improving access to health care but I don't think they should take the place of true primary care physicians.

Posted by: kmani1 | December 24, 2010 11:02 AM | Report abuse

Congress could bribe/coerce universities to put med students on the Navy's WWII V-12 academic schedule (3 trimesters a year), they'll be out in less than 3 years. Throw pre-meds in the pool and they'll be finished with pre-med and medical school in just over 5 years.
http://en.wikipedia.org/wiki/V-12_Navy_College_Training_Program

University of California was looking at something along those lines a couple of years ago.

"Lt. Governor of California and University of California regent John Garamendi recently proposed a bold plan that would allow high school graduates to earn medical degrees in just five years at UC Merced, thus creating a new medical school in the UC system that can generate 23-year-old physicians — the youngest in the nation..."
http://spiffyd.com/blog/new-5-year-medical-school-program-uc-merced-2010

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Posted by: sdgashasdg | December 28, 2010 10:15 AM | Report abuse

Ezra-
Where to begin? It's great populist rhetoric but it just does not work. I'll go further. It's a falsehood driven by stunningly simplistic and wishful thinking.

First, the combined gross annual income of US physicians accounts for about 8% of the annual expense of healthcare. If they all worked for free you would not bend the cost curve. It's not hard to understand, unless you are deliberately obfuscating.

Second, its has been repeatedly pointed out by self styled reformers, yourself among them, that US healthcare does not behave like other economic forces, and that market forces drive cost up. Anyone who adheres to this logic cannot say that decreasing demand will drive down prices without first conceding that markets forces do in fact work in healthcare (in which case, the government should privatize immediately).

Think about it. You double the number of doctors tomorrow, and at the same time cut all their salaries in half-you're still paying 8% of total healthcare dollars to pay for docs. But now you have twice as many tests, surgeries, visits, CT scans-everything that Atul Gawande et al has shown is the real driver of healthcare.

Yes, we pay more of our GDP on healthcare than other developed nations. We also have more diabetes, obesity, violence, and economic disparity than any other developed nation. Other nations, regardless of payer type, struggle more with cost as they develop American style problems-UK and Germany are prime examples. When America gets serious about social reform, we will be able to control costs. As long as we act like healthcare is a discrete entity, rather than an integral part of our economy, we will fail.

Posted by: heartdoc2 | December 28, 2010 8:50 PM | Report abuse

Insane comments. Too many to count.

1. We can save TRILLIONS because physicians make too much. Total annual care cost =2.4T, doctor pay is 8%, so that one is off by a factor of ten. Of course, this is America, and math isn't our strong suit.

2. "That is the truth. Doctors are like Wall Street Bankers with huge Bonus - they have vice like grip on Congress." If you can't tell the difference between a guy who works a 100 hours a week and makes 190K for helping people and a guy who makes 26-100 MILLION a year by betting against the housing market, then I am truly at a loss.

3. "We are basically bringing our National Bankruptcy due to provider cost issue (sic)." We will not bankrupt this country with healthcare, no more than the war effort bankrupted this country in 1946 (when military spending went from 5 to 38% of GDP before returning to normal). We will, however, bankrupt this country with a lack of productivity and a fundamental lack of intellectual competitiveness.

4. "outpatient centers... drive these costs."
Inpatient testing is far more expensive than outpatient testing.

And on, and on...mostly by folks who have never lifted a finger or sparked a single synapse trying to struggle with the problem of treating complex disease-most of which could have been prevented by simple choices in life.

Blaming doctors for cost is like blaming patients for disease. It makes sense until you actually think about it.

Posted by: heartdoc2 | December 28, 2010 10:04 PM | Report abuse

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