No Magic in the Marketplace

In 2006, Massachusetts mandated health insurance and initiated subsidized insurance for people who couldn’t afford private insurance. This suddenly gave a few hundred thousand people access to standard health care who didn’t have it before. However, Massachusetts now has a shortage of primary care physicians to tend to those people.

There are several reasons for this, but a one is that young doctors at the beginning of their careers carry whopping student loan debts, which inspires them to gravitate to higher-paying specialties like surgery. Another is that primary care physicians tend to have higher administrative costs.

(BTW, I’ve seen the primary care physician shortage held up as a reason to avoid universal health care — if everybody can see a doctor, then there will be waiting lines. Like in Canada. I know you love that argument as much as I do.)

At the Boston Globe, doctor and novelist Stephen J. Bergman writes,

THE REASONS for the shortage of primary-care doctors have been clearly described: low pay, long hours, the crossword puzzle of insurance forms required to get paid – which leads to three administrative assistants for every doctor. But the issue is being framed using a classic tactic of the private insurance industry: in order to make ends meet, cut payments to higher-paid specialists and redistribute to primary-care doctors. This pitting of doctor against doctor is a classic tactic of the disastrous healthcare system in which we find ourselves

I would add that if the only way supply can meet demand is by artificially tweaking the system — either by redistributing pay or by keeping large numbers of people uninsured, thereby suppressing demand — does this not tell us that a “free market” solution to the health care crisis will not work?

I want this paragraph on a lot of billboards —

The issue isn’t that primary-care doctors get paid less than cardiac surgeons, but that the system of healthcare rests on insurance companies and their CEOs making huge profits. No amount of cost-cutting can save enough money to support a for-profit system. The only solution is a universal, government-run healthcare system. Surveys suggest that a majority of Americans and doctors desire this. Any plan that puts private insurance in anything other than an optional, “concierge” system for the rich is just whistling past the graveyard of American healthcare.

See also Robert Reich.

9 thoughts on “No Magic in the Marketplace

  1. The open enrollment public plan is absolutely vital to have, but whether or not it is a temporary measure, forcing people to lose their current coverage would be a real political non-starter even if a majority of the people would prefer a single payer model. That is because of differential impact, those who would be affected negatively by losing their coverage will be highly motivated to speak and work against anything that jeopardizes it.

    In the medium term if not sooner, the public plan should participate in sharing agreements which transform the system into a single payer for all covered services, with the private firms able to offer services beyond that.

  2. …The issue isn’t that primary-care doctors get paid less than cardiac surgeons, but that the system of healthcare rests on insurance companies and their CEOs making huge profits. No amount of cost-cutting can save enough money to support a for-profit system.

    I was just thinking that under Murphy’s law of greed, profits can never be big enough, and executive compensation can never be too extravagant. The American form of capitalism has become Mammonism, and quarterly measures of success have so thoroughly trumped any attempt to assess long-term sustainability.

    Maggie Mahar has reported on the profit-induced overbuilding of certain sectors of health care and its catastrophic impact on costs.

    For-profit insurance should be relegated to the luxury and vanity sectors of medicine.

  3. Is it unreasonable to expect, that if a good health care policy were to be enacted, it may actually speed up the economic recovery and give reason to hire more people? Or are they that unrelated?

  4. “This suddenly gave a few hundred thousand people access to standard health care who didn’t have it before.”
    Correction: it gave them access to health insurance, not health care.

  5. Bill H — No, I meant health care, not insurance. They got insurance, which gave them access to the care.

  6. I once saw a truly damning indictment of the American system. I don’t know if it’s true, and I’m not even sure I’m properly stating the indictment, but it went like this:

    The average US GP spends 60 hours a week working, 30 hours of that dealing with insurance companies. The average Canadian GP works 40 hours, 5 hours of dealing with the government regarding payment.

    True? False? I don’t know. But a national system that mandated certain levels of care, and eliminated a lot of the crap about negotiating for treatment would probably make doctoring a lot more pleasant, even if the pay wasn’t as high.

  7. The physician shortage is the part that the kind from Emperors New Clothes wouldn’t have missed.

    This was seldom mentioned in the news and was always coming — educational assistance and inducements for more people to become doctors. It is hardly worth it for some bright people to get an education that will take a decade or more to pay off.

    It’s all connected and government must supply the inducements for fundamental changes like these that the marketplace and its short-term gain mentality would never be inclined to invest in. After all, we are talking about medical care for everyone, not just rich people. Some don’t get the universal part.

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