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Obamacare or Trumpcare, Here’s the Real Problem for Health Care Reform

Mar 27, 2017

In Boston, folks are waiting sixteen weeks to see a family doctor. In Philadelphia, women need to book an appointment 51 days in advance to visit an OBGYN. And in Odessa, Texas, call a cardiology office in late March, and you're lucky to get your ticker checked by mid-June.

Those long and quickly growing wait times are a towering, but vastly under-appreciated threat to health care reform, whatever shape it ultimately takes. Republicans pulled their health care bill Friday after failing to garner enough votes to pass Donald Trump's plan intended to repeal and replace the Affordable Care Act, leaving the law better known as Obamacare in place for now. But for a new version of Trumpcare or any other initiative to succeed, the measure must at least arrest the relentlessly rising costs for hospital stays, MRIs, diagnostic tests and surgical procedures that threaten to swamp the federal budget, shrink take-home pay for families, or pummel both.

America is witnessing a clash between our flat or shrinking roster of super-busy doctors and a fast-growing, rapidly-aging population of patients seeking their services. That's a formula not for more affordable health care, but for more of the same, disastrously escalating prices, or worse. Put simply, medical demand is soaring, and the supply isn't nearly keeping pace. The tragedy is that nothing in either the ACA nor the Republicans' American Health Care Act seriously addresses virtually one half of the problem: Severe, regulation-based restrictions on the availability of care. Unless the issue is addressed, the U.S. is destined for a future of medical rationing.

In fact, it has already started. And nothing illustrates the problem more vividly than the picture of patients forced to wait weeks upon weeks for care that, at these prices, should be available practically the same day the patient calls.

Now, two new studies––both released on March 14––put specific, and highly convincing numbers on the expanding gulf between the over-booked physicians and the folks clamoring to see them. The first is a survey of waiting times prepared by Merritt Hawkins, the nation's largest physicians' recruiting firm (and a division AMN Healthcare Services (amn)). Merritt Hawkins conducted telephone surveys of more than 1,900 practices in two categories of cities, fifteen large metro areas including New York, Boston, Miami and Los Angeles; and an equal number of mid-sized cities as varied as Savannah, Georgia and Dayton, Ohio.

The study was extensive. For example, Merritt Hawkins polled a minimum of ten practices in each large city, and frequently as many as 20, in each of five specialties: family medicine, cardiology, dermatology, obstetrics-gynecology, and orthopedic surgery.

The idea was to mirror the experience of someone new to a community requesting an appointment as a first-time patient, for a potentially important, but non-urgent check-up or procedure. The methodology is spot on because the ACA has given around 20 million newly-insured patients far greater buying power, and the AHCA would have continued subsidizing at least some of the previously uninsured. So the study focuses on the challenge ahead by replicating the experience of the millions of new patients crowding America's health care market.

For the fifteen large metro areas, the average wait time for all specialties was 24.1 days, 30% longer than in 2014. The increase was especially pronounced in two of the most essential categories, family medicine (+50% to 29 days), and OBGYN (+53% to 26.4 days), while another staple, cardiology, rose a significant 27%. Some of the numbers for individual cities are especially alarming. In L.A., it takes 45 days to see a family doctor; in Portland, the wait is 39 days.

The longest lead times to get an appointment are in Boston, 52 days on average for all the specialties. That figure could serve as a bellwether for the future of American health care, because Massachusetts led the nation in extending insurance to virtually its entire population through Romneycare, starting in 2006.

In the medium-sized cities (populations 88,000 to 143,000), the gap between doctors' tight schedules and patients' expanding needs is even wider. For all fifteen smaller metros, the average wait time for the five specialties is 32 days, 33% longer than in the major metros. It takes more than 70 days to see a family doctor in Manchester, NH, Cedar Rapids, Iowa, and Evansville, Ind., and more than 100 days in Albany, NY, and Yakima, Wash. You'd need to book 91 and 71 days in advance to see a dermatologist in Cedar Rapids and Fargo, ND, respectively.

The ratio of doctors to residents is much lower in the medium-sized cities versus the big urban areas. Yet the shortage is even more pronounced in rural communities. Hence, the Merritt Hawkins study actually understates the full extent of a true crisis in small towns across America.

The second study released on March 14 helps explain the disturbing findings in the Merritt Hawkins survey. It's an analysis of the future trends in physician supply by the Association of American Medical Colleges. The AAMC forecasts that America will need as many as 105,000 more doctors than are projected to be practicing in 2030. The ranks of surgeons won't grow at all by 2020. As for categories of expertise, the most notable shortfall will arrive in the medical specialties from cardiology to orthopedic surgery.

What's more, those are the very areas that need to grow the most in order to satisfy the greatest increases in demand moving forward. By 2030, America's population will be 12% larger, but the number of folks over 65 will wax by 55%, and the contingent over 75 will expand by 73%. That combination of a lot more people in general, and a far heavier concentration of the elderly—who consume the vast bulk of medical services from hip replacements to angioplasties—will drive demand for doctors far higher.

Yet the supply of practicing physicians is barely growing. The reason: In 1996, the government severely restricted funding for medical residents, essentially freezing the number of slots that determine the flow of physicians entering the workforce each year, with only tiny additions since.

The shortage already has the first symptoms of rationing. Medicaid, the federal-state program for the poor, pays far lower prices than Medicare. As a result, 47% of the practices in the large metros, and 40% of those in the mid-sized cities, don't accept Medicaid patients. They're simply too chockablock with well-paying Medicare recipients and the commercially insured to accept the lower rates offered by Medicaid. In other words, the tight doctor supply helps raise the market-clearing price, and Medicaid rates are below that price in many instances. That's a formula for rationing.

It's extraordinary that a large cohort of experts advocate shrinking the doctor supply as lever for lowering costs. In an article published last week in the Journal of the American Medical Association, Obamacare architect Ezekiel Emanuel and two co-authors stated as much, declaring, "there appears to be an abundance of physicians in the U.S.," and minting more doctors will "only drive up health care costs and increase inefficiency."

Reform will only take root if America does just the opposite: unshackle the supply side. It's a marketplace handcuffed by certificate-of-need laws that limit the number of MRI centers and hospital beds in communities, granting providers regional monopolies, and preventing insurers from clinching discounts by offering to send patients to the providers willing to lower their rates in exchange for more business. What medical provider is going to agree to discount if every bed is full, and the diagnostic centers are booked for weeks ahead?

The worst restriction is on the essential raw material of health care, the ranks of physicians themselves. If all family doctors have too much business, how can an HMO, or health maintenance organization, that wants to invade an expensive market hire enough of them to challenge the high-priced incumbents? It's not a subject that any of the so-called reformers are even addressing. Forget the argument that the laws of supply and demand won't work in health care. They always work. But to give them a chance, America needs more practitioners of every kind in health care, and that starts with training more physicians—a lot more.

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