We here have been educated to understand the supply problem in American health care, thanks to NoVAH, Mike, and Michigoose, although many, if not all, of us understood the general outlines of this basic issue before we got here. This morning we read this:

What I did not know, until I read this article, is that Medicare covers the lion’s share of the cost of training medical residents.  Further, in order to make ACA’s package politically marketable, in the negotiations, there was no increase in the funding for residents.  Thus ACA built into itself the seeds of its own failure, and this is what NoVAH has been saying to us, although I don’t recall his having pointed to the failure to increase funding for residents.

When I read ACA in detail for my clients, I looked at it from the POV of the effect on small biz, which I decided was actually nil, for my clients.  A myopic view, I admit, but it fit my assignment.  A shortfall of 30000 new doctors in a near time frame will greatly increase health care costs above what they would have been if 30000 new docs had been trained.

12 Responses

  1. In recent past, I think there also has been criticism about federal funding “pushing” residents away from being PCPs and into specialties that do not need additional docs. Maybe somebody recalls this better or has information on how this works?


  2. Okie – The article addresses the somewhat successful attempt to make GP more attractive.

    I thought that the push into specialty was that it provides the new MD with a way to pay off a mortgage sized debt in five years.


  3. so this is what a corking feeling like. I was going to put a post about about this article and a few other things. And Mark is right that I haven’t talked about graduate medical education (GME). It’s not part of my day-to-day an I (in error) have overlooked that aspect of the problem. But the hospitals are active in this area.

    1 — the OIG has a report out that data is iffy on whether or not docs are leaving Medicare. short answer is a big question mark.

    2 — Even if docs are not leaving Medicare in droves, it won’t take much to upset the apple cart. I’m looking for the data, but (from memory and ballparking here) each Medicare enrolled doc has an average caseload of 500 patients. So the snowball effect could be hugely problematic if even 1% of the docs up and quit.

    3- There are a couple of ways for docs to participate in Medicare. It’s not a simply yes or no situation. See

    4 — the Post article gets into recruitment efforts, but it’s not clear it is addressing retirement. They want 30k new docs, but i don’t think they’ve factored in the average age of current physicians. About half are going to reach retirement age in about 10 years. The Post also characterizes pediatricians as primary care, which i don’t think is entirely accurate.

    5 – One of the quiet debates going on is how to support the independent solo and/or small group practitioner. This is the model that most of the members of Congress who are physicians are familiar with and like. but physician groups also are trying to be bought up hospitals. And the recent graduates aren’t as interested in going it alone, for a host of issues. So there’s a bit of a failure to communicate, as the members with influence on the issue are trying to prop up an older model that isn’t all that efficient and isn’t all that attractive to newer docs. (not a hard and fast rule, but this is one of those things that seems to come up in meetings as an aside. the fact that I’ve been hearing this from staffers means they are hearing it somewhere). it’s usually a lament — “yeah, my boss is old school and doesn’t want the family practitioner to go away.” i filed that away, but it seems I’m hearing that more and more. not sure what to make of it)


  4. What if Obamacare pushes more of the MD’s we do have to drop insurance plans all together and go cash only? Right now, it’s very difficult, outside of plastic surgeons and aesthetic Derms to make a go of it on this basis. If the choice comes down to a three month wait or $150 and I see you today, I suspect many will start paying for immediacy. If that’s the case, more shortages, no?


  5. ” If the choice comes down to a three month wait or $150 and I see you today, I suspect many will start paying for immediacy. If that’s the case, more shortages, no?”

    My inkling is there’s a very limited market for cash-only medical care.

    Instead, I expect to get more services from non MD staff.


  6. There is the boutique aspect. but that’s paying for access out of pocket with cash and limiting your patient numbers — and there’s debate on whether they run afoul of Medicare regs. but that’s only going to be viable in certain places.


  7. NoVA:

    And the recent graduates aren’t as interested in going it alone, for a host of issues.

    Bingo! First you start with $200K medical school debt, then you pile the start-up costs of a new practice (>$200K, depending on what you pay yourself), and all of a sudden you are >$500K in the hole). Most of the fellows in our program join existing practices or go into academic medicine. One interesting model is a kind of corporate entity (LLC) with “franchisees” — doctors with solo practices, but that are bankrolled by a larger physician group. So, you have economy of scale for administrative stuff, but relative autonomy of practice for each individual doc.


    • Bingo! First you start with $200K medical school debt, then you pile the start-up costs of a new practice (>$200K, depending on what you pay yourself), and all of a sudden you are >$500K in the hole).

      Heck, established physicians are getting out of the solo business model or even the small physician group model and letting hospitals handle all that administrative stuff.

      To answer Okie’s question about federal funding steering physicians to specialty practices, I don’t think it’s anything in particularl so much as the Fee-for-Service system. You just make more money as a specialist, so physicians go that route.

      Another way to address the physician issue could be to make it easier for foreign physicians to start practicing here. I don’t know the numbers involved, but I’m guessing that would help the physician shortage issue. I don’t know what, if any, impact that would have on the quality of care, but seeing an average or below average physician is probably better than not seeing a physician at all.


  8. I’m not talking about the viability of cash-only right now, but hen Obamacare is in full bloom and waiting times explode. That’s when it’s viability becomes apparent. The question is, will it increase the perception of shortage or have no effect?


  9. I think any effect will snowball, per my 2nd point. If even a small percent of docs start opting out of insurance and/or Medicare

    This is 2008 data, but …

    Physicians and surgeons held about 661,400 jobs in 2008
    20% were internal medicine – so about 132,000 docs. let’s assume they all take Medicare. I overestimated the caseload up-thread, it’s an average of 260 Medicare patients/doc per JAMA. so if 1% quit/drop insurance, etc, that’s 1320 who are no longer treating. Those 1320 docs were treating 343,200 patients that have to be dealt with somehow.

    2% drop, 2640 docs with 686,4000 patients.

    And i think that if that 1% does drop, the remaining will be overwhelmed/overworked. with so many near retirement, getting out will be that much more attractive.

    BLS has 12% as GPs. so about 80,000. 1% drop is 1040. average caseload of 260 — 270,000 patients w/o a doc.


  10. What’s even Romneycare’s effect on ER utilization? Up, down? Anything credible that might help us? Also, in regards to Romneycare, what would the state taxpayer be on the hook for if they weren’t getting Federal assistance?


  11. Overall ER use in Mass went up, but the number of “low level” use went down.

    ER is a lot more complicated than simply having insurance. The availability is a big factor. If you have to clock out and sit in a GPs office for a few hours or wait till you get off work and swing by the ER… easy choice.


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