Majority of Physicians Say They Don’t Recommend a Career in Medicine

Published October 1, 2012

Consumer Power Report #344

We’ve documented in the past the concerns among America’s physicians about how they will adapt to a new reality under President Barack Obama’s health care law, particularly considering the need for more than 30,000 primary care physicians by 2015 even under the most optimistic assumptions of the law’s effects. Now comes a new survey from the Physicians’ Foundation that finds six in 10 doctors are considering quitting and more are sharing their pessimism for America’s health care system thanks to the encroachment of government. Top-line answers from the survey include:

  • More than 50 percent of physicians will cut back on patients seen, will switch to part-time, switch to concierge medicine, or retire within the next four years.
  • 52 percent of physicians have already limited the access of Medicare patients to their practices or are planning to do so.
  • 26 percent have already closed their practices to Medicaid patients.
  • 62 percent believe Accountable Care Organizations (ACOs) are unlikely to increase health care quality or decrease costs.
  • 59 percent say PPACA has made them less positive about the future of health care in America.
  • 57.9 percent would not recommend medicine as a career to their children or other young people.
  • More than one-third of physicians would not choose medicine if they had their careers to do over.
  • 77 percent are somewhat pessimistic or very pessimistic about the future of the medical profession.

The full survey is available here. It’s obvious the majority of physicians are experiencing the squeezing effects of diminished payments and burdensome regulations. No wonder the field appears less attractive to them now than when they entered it. One doctor surveyed writes:

As a young new doctor, I have only begun to earn a living at age 33. I have school loans equivalent to a first home mortgage and unless I work myself to death seeing volumes of (Medicare) patients (i.e. 25 per day due to pathetic reimbursement for my mental energy), I cannot even send my 4 year old to summer camp and I tell my wife to skip the fresh fruit this week.

Making this field appealing again is key to having a system that can meet the needs of Medicare and Medicaid patients. But instead, we’re headed in the opposite direction.

— Benjamin Domenech



Did you remember to get your essential health benefits outline in on time?

Monday (October 1) marks a milestone in the implementation of President Obama’s health care law, or at least it’s a good day to gauge the current attitude of the nation’s governors toward the law.

The U.S. Department of Health and Human Services (HHS) asked states to submit their benchmark health insurance plans – or “minimum benefits” – that would serve as models for plans offered by their state insurance exchanges. Those exchanges are an essential part of the president’s Affordable Care Act, and one of the main instruments to help the uninsured enroll in health insurance plans.

States are supposed to be working on setting up their health insurance exchanges, which will be web-based marketplaces in each state where small businesses and individuals can shop for private health insurance policies. The exchanges are scheduled to be up and running by January 2014.

States can choose not to go that route, in which case the federal government would operate their exchanges. Another option is states can build their exchanges in partnership with the federal government.

The federal government has listed 10 categories of coverage that all insurance plans must include: hospitalization, emergency care, out-patient services, maternity and newborn care, mental health and substance abuse services, prescription drugs, laboratory testing, preventive and wellness care, pediatric services (including dental and vision examinations), rehabilitative care and ongoing support services, such as care for children with developmental disabilities. States were asked to select a model in each of these categories from existing health insurance plans offered in their states.

HHS set Monday as a target date for these plans, although a spokeswoman said Thursday that it was only a suggestion to keep the process on pace for 2014. Some states with Republican governors who continue to oppose the Affordable Care Act are expected to let the deadline pass without submitting a plan. Kansas falls into that category. “The Kansas governor is not going to file,” Sandy Praeger, the state’s independently elected state insurance commissioner, said this week.

Cato’s Michael Cannon had some good recommendations for how states should proceed on this issue.

SOURCE: Pew Center on the States


The Heritage Foundation models the impact of shifts in FMAP:

In the first scenario, the federal match rates are set according to the ACA. In the first three years of the ACA, the federal match rate is 100 percent, gradually rolling back to 90 percent by 2020. Each following alternative scenario reduces the federal match rate in some other fashion.

In the second scenario, a flat 90 percent federal match is assumed. In the third scenario, the match rate is reduced by 10 percent but keeps the same schedule as described in the ACA. In the fourth scenario, the match rate is reduced to a level that can be called the “blended rate” – an estimation of what the match rate could be under the Administration’s suggestion. This blended rate is an average of a state’s current Medicaid match, its enhanced match rate for the Children’s Health Insurance Program, and the expansion match rate. The result of this scheme is a drastic reduction in federal spending at the expense of the states.

While these scenarios do not capture potential (although uncertain) savings from less uncompensated care or increased tax revenues, what is certain is the cost of adding millions of individuals to Medicaid in the expansion.

For example, Ohio would see increased spending in the first five years by $407 million and an increase on the budget by around $1 billion total by 2022 in the first scenario. Under a flat 90 percent match rate, costs increase from $407 million to nearly $1.3 billion in the first five years. Under the blended rate, costs increase to $2.5 billion in the first five years.

The story is similar for Illinois, with increases in spending by $840 million in the first five years and spending of about $2 billion by 2022. Under the blended rate proposed in the fiscal budget, Illinois’s costs increase to $6.7 billion in the first five years.

In Georgia, spending could increase by $200 million in the first five years and by $500 million by 2022 under the ACA. However, if the match rate is lowered for the expansion population, costs could jump to $1.2 billion in the first five years.

SOURCE: The Heritage Foundation


Avik Roy on the importance of block granting Medicaid, reviewing a new Paul Howard paper:

Imagine two people, Jack and Jill. I give Jack 100 dollars to buy food, and let him buy that food from wherever he wants. I give Jill the same $100, but only on the condition that Jill buy her food from Zagat-rated sushi restaurants in New York City. I’ve given Jack and Jill an equal amount of money. But Jack will be able to buy a lot more food with the money I’ve given him.

This is precisely the principle that block grants provide to Medicaid. Currently, the federal Medicaid law does the equivalent of giving the $100 to Jill and micromanaging her food consumption. We gave that same $100 to Jack, but he could buy a lot more food with the same money. Indeed, we could give Jack $90, and he would still be able to buy more food than Jill with her salmon sashimi.

Critics of block grants presume, for reasons that aren’t clear, that $100 spent in the current Medicaid program is equivalent to $100 spent by states in a more decentralized way. But as the story of Jack and Jill shows, there are, in theory, substantial efficiencies that can be gained by giving states broad flexibility in the way they care for the poor. Indeed, this is what made block-granting welfare in 1996 such a spectacular success.

As Paul points out in his excellent paper, block grants have been around for a long time. A government commission recommended them as early as 1949. In 1981, “Congress consolidated 50 federal aid programs into nine consolidated block grants” under the Omnibus Budget Reconciliation Act of that year. People in both parties have supported them as a way to put more money under the Jack model than the Jill one …

Paul reviews how three states – Rhode Island, Indiana, and New York – have taken advantage of more flexibility to save money while delivering better care. (I’ve written previously about the Rhode Island and Indiana experiences.)

At the tail end of the George W. Bush administration, Rhode Island was granted a waiver by the federal government that, in effect, was a block grant: the state was assigned a five-year cap on Medicaid spending of $12.075 billion, in exchange for substantial flexibility to make changes to the program.

The program was a smashing success. Rhode Island was able to save $100 million, and slow the growth of Medicaid from 8 percent per year to 3 percent, by making a few tweaks to their program that they couldn’t before: shifting more Medicaid patients from nursing homes to home- and community-based services; automatically enrolling children with special needs and adults with disabilities into care-management programs; etc.

The best part is that, under a block-grant system, states can identify ways to save money while improving care, and other states can adopt best practices. Indiana, for example, took advantage of a waiver to introduce subsidized health-savings accounts into its Medicaid program, a reform that has been very popular with Medicaid enrollees – one survey showed a 94 percent satisfaction rate – and given Medicaid patients more control over their own health dollars. In theory, HSAs could allow Medicaid enrollees to pay market rates for needed care, improving access and health outcomes.

The Howard paper is here.

SOURCE: Avik Roy


Another brick in the wall:

The turbulent ride to health reform took another detour Wednesday when Gov. Dennis Daugaard said South Dakota would not set up an insurance exchange but instead would step aside to let the federal government come in and do it.

Daugaard said an exchange would force the state to pay an unacceptable price, nearing $7 million a year.

“It has become very apparent that operating our own exchange will simply not work for South Dakota,” he said.

The first choice of Congress in passing the Affordable Care Act in 2010 was that each state would set up an exchange as a local marketplace for consumers to shop for coverage. But the law allows states to opt out and let federal administrators pick up the duty. South Dakota has about 71,000 uninsured residents who probably would be users of the exchange if they comply with the law’s individual mandate requiring most Americans to buy coverage by 2014.

Health leaders have been looking at the issue for months leading up to Daugaard’s announcement that he wants no part of it.

“The federal law requires exchanges to be self-sustaining by 2015, which means we would either have to charge a fee to South Dakota citizens using the exchange or increase taxes, neither of which I am willing to do,” he said.

SOURCE: Argus Leader


Sears and Darden Restaurants take the plunge:

Two big employers are planning a radical change in the way they provide health benefits to their workers, giving employees a fixed sum of money and allowing them to choose their medical coverage and insurer from an online marketplace.

Sears Holdings Corp. and Darden Restaurants Inc. say the change isn’t designed to make workers pay a higher share of health-coverage costs. Instead they say it is supposed to put more control over health benefits in the hands of employees.

The approach will be closely watched by firms around the U.S. If it eventually takes hold widely, it might parallel the transition from company-provided pensions to 401(k) retirement-savings plans controlled by workers and funded partly by employer contributions. For employees, the concern will be that they could end up more directly exposed to the upward march of health costs.

“It’s a fundamental change … the employer is saying, ‘Here’s a pot of money, go shop,'” said Paul Fronstin, director of health research at the Employee Benefit Research Institute, a nonprofit. The worry for employees is that “the money may not be sufficient and it may not keep up with premium inflation.”

Neither Sears nor Darden would say how much money employees would receive to buy health insurance. Darden says its sum would rise as health-care costs rise. Sears declined to disclose details of its contributions strategy.

Darden did say that employees will pay the same contribution out of their own pockets that they currently do for approximately the same level of coverage. Employees who pick more expensive coverage will pay more from their paychecks to make up the gap. Those who opt for cheaper insurance, which may involve bigger deductibles or more limited networks of doctors and hospitals, will pay less.

“It puts the choice in the employee’s hands to buy up or buy down,” said Danielle Kirgan, a senior vice president at Darden. The owner of chains including Olive Garden and Red Lobster will let its approximately 45,000 full-time employees choose the new coverage in November, to kick in Jan. 1. Darden says that employees with families to cover will be given more money to buy insurance than employees covering just themselves.

The hope is that insurers will compete more vigorously to get workers to sign up, which will lower overall health-care costs. Darden and Sears are both currently self-insured, meaning that the cost of claims each year comes out of company coffers.

On average, U.S. employers and workers are estimated to spend $15,475 in annual premiums for health insurance this year for a worker with family coverage, according to a survey by the Kaiser Family Foundation and Health Research and Educational Trust. The average employee pays about 28% of that amount and the employer picks up the balance.

SOURCE: Wall Street Journal


Unanticipated results of government policies: less smoking, less cancer, fewer skinny people.

The American smoking rate is going down. The obesity rate is going up. And when it comes to women’s life expectancy, those trends have just about canceled each other out.

A team of researchers with the National Bureau of Economic Research published data looking at obesity and smoking rates. … Both of those trends have an impact on longevity; these researchers wanted to tease out how each affected lifespan. Overall, the benefits of less smoking are outweighing the negatives of rising obesity – but only by a little bit, especially when it comes to women. NBER found:

“The combined effect of changes in smoking and obesity is expected to produce steady improvements in male life expectancy through 2040, with a total gain of 0.92 years by that date. On the other hand, women’s life expectancy is expected to be lower as a result of the combined changes through 2030. Thus, the pattern of reductions in the female advantage in life expectancy that has been evident since 1979 is expected to continue for another two decades, at least from these sources. By 2040, life expectancy is anticipated to be 0.26 years higher for females as a result of these combined behavioral changes.”

That assumes that current trends hold, although there is some evidence that tobacco use is going up among young adults, which could change some of the calculus here.

SOURCE: Washington Post