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Home Publications Blogs Beat the Press Rewriting History on Doctor Shortages: Protectionists Bury the Bodies

Rewriting History on Doctor Shortages: Protectionists Bury the Bodies

Friday, 25 July 2014 05:19

Earlier in the week the NYT had an editorial decrying the shortage of doctors and proposing routes to address it. (Strangely, bringing in more foreign doctors was not on the list.) Today the paper ran a number of letters responding to the editorial including one from president of the American Medical Association (A.M.A.) discussing its heroic efforts to alleviate the doctor shortage. This is opposite to the reality.

The A.M.A has long supported measures to restrict the number of doctors in order to ensure that the overwhelming majority earn salaries that put them in the top 1-2 percent of workers. This fact can be discovered simply by reading through past New York Times articles. For example, a 1997 article carried the headline "Doctors Assert There are Too Many of Them." This article reported on the complaints of doctors' organizations:

"'The United States is on the verge of a serious oversupply of physicians,' the A.M.A. and five other medical groups said in a joint statement. 'The current rate of physician supply -- the number of physicians entering the work force each year -- is clearly excessive.'

"The groups, representing a large segment of the medical establishment, proposed limits on the number of doctors who enter training programs as residents each year.

"The number of medical residents, now 25,000, should be much lower, the groups said. While they did not endorse a specific number, they suggested that 18,700 might be appropriate."

Another article, headlined "U.S. to Pay New York Hospitals not to Train Doctors, Easing Glut," told readers of a plan:

"that health experts greeted as brilliant and bizarre, Federal regulators announced yesterday that for the next six years they would pay New York State hospitals not to train physicians.

"Just as the Federal Government for many years paid corn farmers to let fields lie fallow, 41 of New York's teaching hospitals will be paid $400 million to not cultivate so many new doctors, their main cash crop.

"The plan's primary purpose is to stem a growing surplus of doctors in parts of the nation, as well as to save Government money."

Any discussion of an alleged shortage of doctors in the United States should include an account of the doctors' efforts to create this shortage to keep their salaries high. It is also striking that, unlike the case of STEM workers, nurses, or farm workers, no one discusses bringing in more foreign doctors to alleviate this shortage. There would be hundreds of thousands, perhaps millions, of foreign physicians who would be happy to train to U.S. standards and work for even half of the pay that doctors get in the United States. This would reduce the cost of health care in the United States, freeing up tens of billions of dollars to be spent in other areas creating hundreds of thousands of jobs.

And, we do know how to ensure that importing more foreign doctors does not hurt health care in the developing world. If the income taxes paid by foreign trained doctors were transferred to their home country, they could easily train 2-3 doctors for every doctor that came to the United States. This would ensure that developing countries gained from this arrangement as well.

It is striking that the same people who eagerly promote removing barriers to imported goods, putting downward pressure on the wages of manufacturing workers, and support bringing in foreign workers to put downward pressure on the wages of nurses and STEM workers seem unable to even conceptualize the possibility of bringing in foreign doctors to alleviate an alleged shortage.

Comments (9)Add Comment
Too Many of the Best and Brightest - Not Enough Qualified Doctors Who Know Best
written by Last Mover, July 25, 2014 6:37

That's what happens under the shortage created by the AMA and those complicit. The high salaries and strict entry requirements cull out everyone but the best and brightest, paraded around as necessary for the doctors America get.

They are not necessary. The doctors are over qualified in many ways then their talents are carefully rationed with non-price means to keep prices high.

The conservative right is keen to bash workers in positions claimed shielded from market competition and paid above their pay grade, but conveniently go mute when it comes to the obvious counterpart of white collar professionals. (Government workers are the exception whom they always bash.)

A key point of Dean Baker's push to import more doctors is, this is one of the few areas in health care where markets don't necessarily fail and can acutally work.

Doctors are key decision makers with enough power behind their licenses to be game changers. They can go around other doctors and the mountain of market power that currently reigns over America's medical insitutitions. Newly imported doctors not yet bought off by the medical industrial complex are mostly likely to do this.

The doctor still knows best in most cases as the saying goes. But the doctor no longer functions from that perspective, hijacked by a system that contradicts itself so much, the overqualified best and brightest who end up as doctors are reduced to little more than underlings in a corporate complex run by MBA types who set their schedules and all the rest of it.

They could use a dose of old fashioned free market competition from more imported doctors that still works in the health care industry - if the AMA and the corporate right would just get out of way with its big government designed to suppress it.
Most developed nations train more doctors than we do. They must be smarter.
written by Rachel, July 25, 2014 7:17

And of course in most developed nations the average lifespan is longer.

So there's no need to complain too much about a wish to finally fund more residencies.

The next trick is the problem that too many physicians will be working for a few big hospitals. And of course there is the problem that mandatory big-basket health insurance constitutes a semi-regressive tax.

Incidentally, there's no need to assume that our physicians are generally the best and the brightest. For example, the amount of training-to-the-test that goes on among the well-heeled is pretty impressive.
You can't bring doctors from foreign countries
written by Bill H, July 25, 2014 9:47
Because they are badly trained hacks who will kill more patients than they save. Other countries do not know how to teach medicine and cannot produce decent doctors, so of course we cannot let them practice medicine in the country with "the best health care in the world."

Would you want to be treated by the same kind of doctor that treats the Queen of England? Of course not. It would be unthinkable to give that idiot a license to practice medicine in America.

I hope you realize I'm not being serious, here.
I see the problem
written by Dave, July 25, 2014 10:24
But I just don't agree with the solution. I don't like to see trade and immigration used as a weapon. I think it would be better to address the problem at its source: create laws that prevent the AMA and other organizations from limiting supply.

I'm all for allowing doctors to immigrate here, but I think immigration needs to be proportional to career populations to avoid distortions that drive people away from these fields. It doesn't look like a problem until it is a problem, as it is in STEM, and once the problem begins, it is almost politically impossible to stop it because of the money generated.

Yes, the people who hold these narratives are hypocrites. They believe it is ok to discriminate against other kinds of workers and to favor themselves and those they know. This is wrong. But a real solution should include creating more educational opportunities in the US also, not just abroad.
written by AlanInAZ, July 25, 2014 10:59
It isn't enough to bring boat loads of foreign doctors to the US to lower cost - you must also make price an important factor in medical provider selection. This requires an overall of our insurance system - including Medicare and Medicaid. I don't agree with Dean Baker's ideas on medical cost containment but I admit that a case can be made for free market solution if the entire market is "free".
written by Jay, July 25, 2014 12:27
I agree with Alan's point about reducing other medical costs. I get Dean's point but I think it would be better to make medical school free and allow people like physician assistants to enter med school with credit for their prior education and experience. We don't have much job creation going on and I think we should use this opportunity to put more of our people back to work. The government could fund post bac education for people interested in med school and require them to serve in an underserved area when they become a doctor for a couple of years. There are more options but they will take longer.
@Bill H
written by Dave, July 25, 2014 1:00
Holding people to the US standard doesn't mean we don't like foreigners etc...

Europe might be the led we need to follow, but this has nothing to do with race or place of origin. It is about the fact that standards differ by the court systems in place.

At this point, the US court system has lowered itself to third-world standards, and we are no longer exceptional.

Oh well. Easy come, easy go.
In Front of Your Nose
written by Mark Palko, July 25, 2014 9:40
"Many recent statements in the press have declared that it is almost, if not quite, impossible for us to mine as much coal as we need for home and export purposes, because of the impossibility of inducing a sufficient number of miners to remain in the pits. One set of figures which I saw last week estimated the annual ‘wastage’ of mine workers at 60,000 and the annual intake of new workers at 10,000. Simultaneously with this — and sometimes in the same column of the same paper — there have been statements that it would be undesirable to make use of Poles or Germans because this might lead to unemployment in the coal industry. The two utterances do not always come from the same sources, but there must certainly be many people who are capable of holding these totally contradictory ideas in their heads at a single moment."

George Orwell
"In Front of Your Nose"
monopolistic yes, but contributing less to the problem than you think
written by michael, July 27, 2014 5:39
I agree that the AMA has intentionally restricted the number of doctors entering the market to make sure doctors have significant leverage in keeping their salaries high and exercising power for setting policy. However, the contribution of doctor salaries to overall health care costs is surprisingly small. If you cut doctor's salaries in half you would not really make a meaningful dent in the problem. Maybe a 7.5% reduction that would end up angering a lot of people.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.