Archive for December, 2007

The Doctor Conundrum

Saturday, December 1st, 2007

Health care in America is a $2 trillion, high-growth industry. Doctors are in short supply just about anywhere you go in the country. Many, if not most, family practice doctors are not accepting new patients. Even upper-class, well-insured patients have to wait a couple of weeks or more for a regular appointment with a specialist.

Doctors seem to be busy. Indeed, the surveys show that they are spending as much time or more on patient care activities than they did 10 years ago – and the volume of procedures per physician is way up.

The stock of new physicians (new graduates minus retirees) is growing no faster than the population, but health care costs have been consistently growing at 6 percent to 10 percent per annum over the last decade or more. We are also smartening up as a nation and starting to reward physicians for quality improvement through pay-for-performance schemes. And here is the big one: Given that baby boomers have started to hit the early stages of total body breakdown, the demand for almost every medical specialty is poised to explode.

Reasons to Be Cranky

It would seem to be a brilliant time to be a doctor. You have market power, a demographic bonanza, lots of new technology to use that liberates you from the clutches of hospitals, patients who want to spend time with you, and an American society that appears to grant health care an ever-expanding share of the economy. What’s not to like?

How then can you explain the fact that in Harris Interactive/Harvard surveys of physicians conducted for Strategic Health Perspectives, my colleagues found physician satisfaction at its lowest ebb since we started measuring it in the early 1990s? A full 43 percent are saying they are dissatisfied with their practice. Are these people nuts?

Well, I don’t think they are crazy. Physicians are frustrated by administrative complexity, both public and private. They are angry at the constant threat of Medicare price cuts. They feel they are losing autonomy to faceless bureaucrats in Washington, the state capitals and Hartford, Conn. They see their patients as having to jump through mindless financial hoops that impair their compliance. They are happy about expanding science and knowledge and want to deliver good care, but the economic and administrative circumstances overwhelm the positives and put them in a black mood. Doctors are just cranky.

But what really pisses them off is the gap between their incomes and those of the rest of the high-end college graduates of America. The Center for Health Systems Change analysis of average physician income adjusted for inflation between 1995 and 2003 showed that income for all physicians declined by 7.1 percent over the period; for primary care doctors, by 10.2 percent; for medical specialists, by 2.1 percent; and for surgical specialists, by 8.2 percent. This is in sharp contrast to the 6.9 percent gain that all professional and technical workers made in the same period.

Put in stark local terms, my surgeon neighbors at Stanford drive Chryslers, my software neighbors drive Mercedes, my lawyer neighbors drive multiple BMWs (they are good at multitasking) and my venture capitalist neighbors have off-site garages to store their many exotic cars. If I were a doctor, the smartest kid in my high school class, the top 2 percent of my college class, and magna cum laude at Stanford, I would be pissed off, too. It is pretty bad when the lazy geography graduates like me make more than the surgeons.

Compensation Discrimination

While many like to point to the fact that doctors make more money in America than in any other country – which is true – they miss the big point. There are way more undeserving, highly compensated pigs at the health care trough than doctors.

Let’s start at home. Consultants and futurists are paid four to five times what they would be in other countries; hospital CEOs, three to four times; administrators of all types, two to three times; and so on. CEOs of health plans who rack up $100 million-plus in compensation over the course of a career are well ahead of the cumulative earnings of all the ministers of health in the developed world.

And then there are the sales men and women of America. I want my son to be a salesman because America rewards sales more than almost any other profession. There are armies of sales people in American health care, many of whom are making much higher incomes than the doctors they are calling on. These are just estimates: I urge someone with access to all these numbers (such as the compensation consultants) to publish them. Just wait and see how angry the doctors will be then.

The solution is not just to pay doctors more through fee-for-service upgrades or to tweak their incentives through petty pay-for-performance schemes. We need to imagine reimbursement systems that reward clinical excellence and professionalism and that provide incentives to do the right thing for patients, at the right time, in the right place and by the right people (which may mean less expensive and more reliable auxiliary health professionals). We also need to look long and hard at whether we are rewarding acts of commercialism in health care more than the health care services that patients and society really want.

Ian Morrison is an author, consultant and futurist based in Menlo Park, Calif. This article 1st appeared on December 11, 2007 in HHN Magazine online site.