America / Healthcare

Is the Physician Shortage a Myth?

The notion that a physician shortage is growing in the United States has become deeply ingrained in the healthcare ethos. However, growing evidence shows that this widely accepted assumption might be fundamentally flawed.

The traditional belief about the physician shortage initially seems to make sense for three reasons. First, the segment of the population over the age of 65 is estimated to increase from 12.9 percent in 2009 to 19 percent by 2030. As a result, more doctors will be needed to treat chronic illnesses and diseases that primarily afflict the elderly, such as diabetes and cancer. Second, the Affordable Care Act is expected to insure 32 million more Americans by 2020, which will inevitably raise the demand for physicians. Third, the physician supply is expected to increase at 7 percent over the next ten years, a rate that appears to be insufficient compared to the growing numbers of Americans needing healthcare. Consequently, the Association of American Medical Colleges (AAMC) estimates that by 2020, there will be a shortage of over 90,000 physicians in the United States, consisting of a shortage of 45,000 primary care physicians (PCPs) and 46,000 specialists. While these AAMC figures are larger than other estimates, the Department of Health and Human Services still projects a shortage of 20,400 PCPs by 2020, if current trends continue.[1]

The physician supply is expected to rise modestly in the next ten years due to the large bottleneck in the residency portion of the medical curriculum. Residencies are federally funded post-medical school programs that provide physicians with on-the-job training. As part of the Balanced Budget Act of 1997, Congress capped the number of federally funded residency slots. Only 17 thousand residency positions have been added since 2001, despite the population growing by 49 million. Medical schools have tried to rectify this situation by increasing their class sizes, but the federal government still has not increased the number of residency slots available. Therefore, the AAMC projects that the 26,000 residency slots currently available for first year trainees will not be enough for medical students graduating as early as 2016.

While these projections paint a grim picture for the state of healthcare in the United States, mounting evidence – including a report released by the Institute of Medicine – argues that older models tend to inflate statistics by not taking into account many of the changes that will streamline care, improve quality, and reduce the costs of health delivery. As the Harvard economist, Amitabh Chandra stated, “Maybe it looks like there’s a doctor shortage, but that’s because the system is inefficient. Inefficient cars require more gas. Inefficient health care systems require more doctors. The last thing we’d want to do is increase the number of doctors and then reform the system — then we’d have a surplus, which would result in unemployed doctors or doctors providing excessive services to patients.”

There are many recent changes in medicine that the AAMC has failed to incorporate into their statistics regarding the physician shortage. First, new technologies such as Skype and telemedicine can help physicians diagnose and treat wider patient populations, especially those living in rural areas. A study in Health Affairs found that telemedicine technologies could reduce demand for physicians by 25 percent or more.

Second, medical innovations are helping physicians effectively treat larger patient populations. For example, electronic sensors can tell physicians if a patient has taken a drug; minimally invasive procedures can decrease recovery time, hospital stays, and costs; and better screening technologies are now in place that can diagnose patients early and prevent certain conditions from worsening.

Third, physicians are more commonly working together in large practices that are able to share resources, staff, and office space. As a result of these economies of scale, the output of physicians should increase, alleviating some of the projected physician shortage.

Lastly, studies have shown that healthcare providers, such as nurse practitioners and physician assistants, can decrease much of the burden placed on physicians. Since these workforces are projected to grow more rapidly than physician workforces, the physician shortage could be curbed by giving these mid-level providers more responsibilities. HHS estimates that an effective integration of these providers into the healthcare system could reduce the PCP shortage in 2020 from 20,400 to 6,400. This integration remains controversial because it could lead to mistakes in treatments and could dissuade medical students from becoming PCPs. As it is, medical students tend to want to specialize rather than remain PCPs, especially since specialists earn, on average, $3 million more over their careers. Nevertheless, full integration of these nurse practitioners and physician assistants is projected to only reduce PCP delivered care by 5 percent from 2010 to 2020. Consequently, full integration would not hurt PCPs and could help the healthcare industry curb costs and reduce the physician shortage. However, it should be noted that these transitions, though beneficial in the long run, would likely decrease the quality of care and cause some patients to suffer, as providers adjust to the new system.

In addition, the unequal distribution of physicians across the country exacerbates the physician shortage and causes it to appear larger than it should be. Physicians are largely hesitant to set up their practices in rural areas, where demand and compensation are lower. Furthermore, physicians tend to establish their practices where they completed their residencies. As a result, physicians tend to cluster in cities, rather than rural areas, causing 20 percent of Americans to live in areas with an insufficient number of PCPs. To address the PCP shortage and this geographical disparity, the HHS has proposed to increase residency funding by $5.23 billion to produce 13,000 more physicians (specifically more PCPs) over the next ten years, to implement more efficient healthcare delivery, and to encourage physicians to work in underserved, rural areas.

With all the changes in medicine, it is unclear exactly how pronounced the physician shortage will be within the next decade. However, the shortage will certainly not be as large as expected by the AAMC. Consequently, it might be time for us to shift away from the paradigm of an impending, apocalyptic physician shortage, to a more nuanced understanding of the issue, so that credible solutions to this problem can be debated and eventually applied to the healthcare industry.

[1] The HHS report did not consider the specialist shortage in their report.