The Doctor Won't See You Now. He's Clocked Out

Big government likes big providers. That's why ObamaCare is gradually making the local doctor-owned medical practice a relic. In the not too distant future, most physicians will be hourly wage earners, likely employed by a hospital chain.

Why? Because when doctors practice in small offices, it is hard for Washington to regulate what they do. There are too many of them, and the government is too remote. It is far easier for federal agencies to regulate physicians if they work for big hospitals. So ObamaCare shifts money to favor the delivery of outpatient care through hospital-owned networks.

The irony is that in the name of lowering costs, ObamaCare will almost certainly make the practice of medicine more expensive. It turns out that when doctors become salaried hospital employees, their overall productivity falls.

ObamaCare's main vehicle for ending the autonomous, private delivery of medicine is the hospital-owned "accountable care organization." The idea is to turn doctors into hospital employees and pay them flat rates that uncouple their income from how much care they deliver. (Ending the fee-for-service payment model is supposed to eliminate doctors' financial incentives to perform extraneous procedures.)The Obama administration also imposes new costs on physicians who remain independent—for example, mandating that all medical offices install expensive information-technology systems.

The result? It is estimated that by next year, about 50% of U.S. doctors will be working for a hospital or hospital-owned health system. A recent survey by the Medical Group Management Association shows a nearly 75% increase in the number of active doctors employed by hospitals or hospital systems since 2000, reflecting a trend that sharply accelerated around the time that ObamaCare was enacted. The biggest shifts are in specialties such as cardiology and oncology

Estimates by hospitals that acquire medical practices and institutions that track these trends such as the Medical Group Management Association show that physician productivity falls under these arrangements, sometimes by more than 25% (more on this below). The lost productivity isn't just a measure of the fewer back surgeries or cardiac catheterizations performed once physicians are no longer paid per procedure, as ObamaCare envisions. Rather, the lost productivity is a consequence of the more fragmented, less accountable care that results from these schemes.

Editorial board member Joe Rago on why ObamaCare will make it more difficult for patients to see doctors. Photo: Getty Images

Once they work for hospitals, physicians change their behavior in two principal ways. Often they see fewer patients and perform fewer timely procedures. Continuity of care also declines, since a physician's responsibilities end when his shift is over. This means reduced incentives for doctors to cover weekend calls, see patients in the ER, squeeze in an office visit, or take phone calls rather than turfing them to nurses. It also means physicians no longer take the time to give detailed sign-offs as they pass care of patients to other doctors who cover for them on nights, weekends and days off.

Most hospitals exacerbate these strains by measuring the productivity of the physician practices they purchase in "Relative Value Units." This is a formula that Medicare already uses to set doctor-payment rates. RVUs are supposed to measure how much time and physical effort a doctor requires to perform different clinical endeavors.

Medicare assigns each clinical procedure a different RVU and then multiplies this figure by a fixed amount of money to arrive at how much it will pay a doctor for a given task. A routine office visit has an RVU of about 1.68, while removing earwax has one of 1.26. Setting a finger fracture rates a 3.48.

This system misses all of the intangible factors that help gauge the quality and efficiency of the care being delivered. It focuses physicians on the wrong goals for promoting health, such as how well they code charts to capture higher-value "units."

Hospitals are beholden to the RVU system only because that is how they get paid by the government. Data from the Medical Group Management Association shows that physician productivity in these employed relationships, measured simply by RVUs, declines up to 25% compared with independent practices. The Advisory Board Company, a health-care consulting firm, estimates that when hospitals last went on a physician-acquisition binge in the late 1990s, productivity fell by as much as 35%. Those arrangements mostly failed, and the hospitals divested the stakes they had in individual doctor practices. The physicians went back to practicing out of their own offices.

All of this reduced productivity translates into the loss of what should be a critical factor in the effort to offer more health care while containing costs. Yet hospitals aren't buying doctors' practices because they want to reform the delivery of medical care. They are making these purchases to gain local market share and develop monopolies. They are also exploiting an arbitrage opportunity presented by Medicare's billing schemes, which pay more for many services when they are delivered at a hospital instead of an outpatient doctor's office.

This billing structure exists because hospitals are politically favored in Washington. Their mostly unionized workforces give them political power, as does their status as big employers in congressional districts.

ObamaCare pushes this folly largely based on a naive assumption that models that worked well in one community can be made to work everywhere. President Obama has touted "staff models" like the Geisinger Health System in Pennsylvania and the Mayo Clinic in Minnesota that employ doctors and then succeed in reducing costs by closely managing what they do. When integrated delivery networks succeed, they are rarely led by a hospital. ObamaCare seeks to replicate these institutions nationwide, even though their successes had more to do with local traditions and superior management. That's hard to engineer through legislation.

Dr. Gottlieb is a physician and resident fellow at the American Enterprise Institute.

A version of this article appeared March 15, 2013, on page A13 in the U.S. edition of The Wall Street Journal, with the headline: The Doctor Won't See You Now. He's Clocked Out.

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Is There a Doctor in the House? Probably Not

One reason for the shortage is the aging of both doctors and their patients.

According to a 2012 Physicians Foundation survey, nearly half of the 830,000 doctors in the U.S. are over 50 and approaching retirement. They are also seeing fewer patients than they did in 2008.

The patient pool is getting older, too, with some 8 million people reaching retirement age every day. Older people need more health services, and some 15 million will be eligible for Medicare in the coming years.

Entering the system in 2014 will be the 30 million additional people with access to services through the Affordable Care Act (Obamacare).

"There were shortages in doctors when Massachusetts did their version of the Affordable Care Act," said Ruselle Robinson, a health care business attorney and former general counsel to the Massachusetts Department of Public Health.

"It's hard to say how this will play out with all the new people being added to health care next year," Robinson said.

Younger doctors are also part of the shortage problem. Saddled with medical school debt that can average $250,000 on graduation, many are choosing higher-paid specialties like cardiology or surgery.

"When students leave med school a lot of them are thinking about how I can make the most money," Saag said. "Somehow, we have to figure out a way to reward primary care providers so more will enter that area."

One way to reduce such debt and get doctors into the system more quickly is accelerated education, making medical school three years instead of four — something that is not new but not widely followed.

NYU has such a program now, as does Texas Tech, which is graduating its first class this year under the new schedule. It takes nearly a decade to educate a doctor and the hope is one less year would help cut down on the financial burden.

(Read More: College Roulette: Ask for Financial Aid, or Not?)

"It's not clear yet as to whether this is a good model and how viable it will be," said Dr. Andew Filak, senior associate dean at the University of Cincinnati College of Medicine.

"For some students, three years would be adequate," Filak said. "For others, some more time might be necessary to assure that the student has the fundamental knowledge and experience to move on to a residency program."

Other solutions include letting nurse practitioners be more involved at the primary care level. Sixteen states now allow them to see patients for checkups, and ordering and interpreting diagnostic tests.

Some would like more states to adopt similar programs.

"We need to have a lot more nurse practitioners on the job," said Terry Fulmer a nurse and the dean of Bouve College of Health Sciences at Northeastern University.

"Obviously, they don't have the education of a physician, but they are highly trained professionals. And if the outcome is equal to what a doctor would do, it doesn't matter how many hours' training a nurse has," Fulmer said.

Another way to work around the doctor deficit is more team-based care, in which a physician-led team of at least two health care professionals (nurses and doctors) work with each other, the patient and the family.

Getting more medical professionals into the pipeline won't be easy. Though Obamacare authorized more government funds to increase training for primary care doctors, nurse practitioners and physician assistants, that money is set to be cut in the ongoing budget battles.

(Read More: Your Company's Next Health Plan: Drop the Doughnut)

There is some hope. More than 45,000 students applied to medical school last year, up 3.1 percent from 2011. First-time applicants, considered to be a barometer of interest in the field, set a record, increasing by 3.4 percent.

"I think more medical students these days are going in with their eyes wide open and for the right reasons," said Dr. Joel Blass.

"Even dealing with all the regulatory and insurance requirements, I think it's all moving in the right direction," Blass said.

And one expert says it's not so much a scarcity of physicians but of using them in the right way.

"We don't need more physicians, but rather better "team-based workflow tools" to ensure that everyone on the team can work to the highest level of their ability in a safe and efficient manner every day," said Dr. Lyle Berkowitz, Associate Chief Medical Officer of Innovation for Northwestern Memorial Hospital.

"That means using information technology and freeing physicians to spend their time on more complex patients," Berkowitz added.

But many physicians are questioning their profession. In a recent survey of U.S. doctors, more than 84 percent said the profession was in decline. Nearly 60 percent said they wouldn't recommend medicine as a career.

More than 75 percent said they were overextended and as result, nearly 6 percent of doctors said the were working fewer hours than they did in 2008.

"Our medical system is in chaos, and the shortage is part of it," Saag said, who added that Alabama and other nearby states have a shortage of HIV specialists.

"Whether it's getting more doctors or a health care system we can all understand, something needs to change and soon."

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'Beijing Cough' an Insult to China's Capital, Doctor Says

A top doctor in China said that the term "Beijing cough" is an insult to the Chinese capital.

Professor Pan Xiaochuan of Peking University's School of Public Health said that the term was created by expats and was not an official medical condition.

"Before you can find clear evidence of this [causal link], using the term 'Beijing cough' is an extreme insult to Beijing," Pan told the Economic Information Daily, reported the South China Morning Post.

He went on to say that one would eventually acclimatize to the pollution.

"It's pretty rich for the doctor to insinuate that people living in Beijing — and, more particularly, foreigners — are whiners and exaggerators for complaining about the air in previous weeks," reported GlobalPost's senior correspondent Benjamin Carlson.

(Read More: Beijing's Air Pollution Is 'Worst on Record')

"As any watcher of Chinese news knows, Beijing's air has been off the charts. Respiratory illnesses have already risen. Ordinary Chinese citizens have taken to wearing masks around Tiananmen Square," Carlson reported from Hong Kong, adding: "Even state-owned media like People's Daily are acknowledging 'Beijing cough' as something real, and dangerous."

It is estimated that Beijing currently has 40 times the smog level which World Health Organization deems as safe.

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Did You Hear About the 'Doctor' Cliff?

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