How worries over a physician surplus led to today's doctor shortage : The Indicator from Planet Money The doctor shortage is a growing problem across the U.S. But there was a time when the government, researchers, and medical professionals worried about a doctor surplus.

What's the cure for America's doctor shortage?

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For medical school graduates, March is a very emotional month. And that is because March is match season. It's a time when newly minted MDs find out where they're going to do their residency training and work for the next few years on their way to becoming a full-fledged, independent, practicing physician.


If you search match Day 2023 on TikTok, you'll see just how big a deal this is for young doctors. They're all dressed up, cheering and crying and hugging.


UNIDENTIFIED PERSON #1: And I matched at Cedars-Sinai for orthopedic surgery.


UNIDENTIFIED PERSON #2: I'm going to Mayo Clinic.

UNIDENTIFIED PERSON #3: You got Mayo Clinic? You got Mayo Clinic.

WOODS: So yes, match season is very important for the doctors. But you know what? It's also very important for the rest of us because we need more doctors in this country. There is a growing shortage of them, and it's getting worse as our population grows bigger and gets older. This is THE INDICATOR FROM PLANET MONEY. I'm Darian Woods.

MA: And I'm Adrian Ma. If current trends in the doctor workforce continue for another decade, the Association of American Medical Colleges estimates this country will be short as many as 120,000 physicians. So today on the show, we'll break down the reasons why this market for medical talent is feeling pretty ill right now. And we'll also talk about a potential cure.


MA: When experts talk about a doctor shortage, they basically mean we don't have enough of the kinds of doctors we want in as many places as they're needed.

WOODS: The Association of American Medical Colleges has tried to estimate the shortfall for various kinds of doctors using statistical models. They estimate that if workforce trends and health care demands continue as expected, the country could be short almost 50,000 primary care doctors in a decade. Candice Chen knows this firsthand.

CANDICE CHEN: I'm a primary care pediatrician in southeast Washington, D.C., which is an underserved urban community. When we don't have enough other physicians, it means that we're scheduled appointments every 15 minutes - that we don't have the time that we can - that we need to be able to spend with patients, but to hit the revenue marks and to make sure that the clinic can just keep their doors open. You know, the scheduling says that we have to keep moving. And on a day-to-day basis, that feels awful.

MA: Candice, by the way, is a professor of health policy at George Washington University. And she worries that, with a lot of doctors feeling pandemic burnout, the doctor shortage may only get worse. And we're not just talking about for primary care, but certain specialties as well, like OB-GYNs. At its root, this is a problem of supply and demand. And when you look at the reasons behind it, you start to realize that the medical profession kind of did this to itself.

WOODS: The story goes back to the 1970s and '80s. At the time, policymakers noted an unprecedented surge in health care spending. And Robert Orr, who studies health policy at a think tank called the Niskanen Center, says policymakers weren't sure why.

ROBERT ORR: We're used to this now, but it was new to them at the time. And so they were, you know, looking for all these theories of sort of - what's the problem? And what caught on was this theory of physician-induced demand.

MA: And that theory - physician-induced demand - this was kind of a prevailing view at the time. You know, organizations like Pew Research were saying, we've got too many doctors prescribing too many treatments, which is leading to too much spending. So one way to solve rising health care costs could be to reduce the number of doctors.

WOODS: The profession took note. Medical schools were like, we should do something about that.

ORR: You can read a lot of documents from the time, where people will say, like, we've got to, you know, take this into our own hands, or else government regulation will be on the way. So in 1980, the MD-granting schools enacted a voluntary moratorium on their enrollment and the establishment of new schools. And this lasted about 25 years.

MA: Up until about 2005, at which point medical schools were like, uh, we have made a mistake, and reversed course, lifted the moratorium. And yet, you know, that was 25 years where the country's population was growing and medical school slots were not.

ORR: And we're sort of still digging our way out of that hole.

WOODS: Even if we get out of that medical student hole, that doesn't solve an arguably bigger cause of the doctor shortage. Candice Chen says that, for years, there's been a serious bottleneck in residency training.

CHEN: And residency training is that thing that happens after medical school. I want to be like, if you remember "ER," it's what Dr. Carter was.

MA: If you're a "Scrubs" or "Grey's Anatomy" person, a J.D. or Meredith Grey type.

CHEN: But basically, you can't independently practice in the United States without having done residency in the United States. So in a lot of ways, it is the gatekeeper of our physician workforce.

MA: Now, one important thing to know about these gatekeeping jobs is that hospitals generally do not pay for them. The government does. Specifically, Medicare does. And while the word Medicare might make you think about health care for older people, it's also the key source of funding hospitals rely on to hire residents. And also, also, this system is way out of date.

WOODS: And here's why. In the late 1990s, residency funding fell under the crosshairs of congressional lawmakers who were trying to balance the budget.

CHEN: Congress went, ooh, we don't have any limits on how much money we're going to put out to support these residency training, right? And they passed some legislation that put a cap on each hospital based on how many the hospital was training at the time. So for example, if you had 100 residents at that time, then Medicare will pay for 100 residents.

MA: Essentially, the funding for training up new doctors has been cryogenically frozen. And because the money was tied to specific hospitals in specific places, it hasn't kept up with the country's changing demographics. That's why hospitals in growing cities can't get enough residents.

WOODS: One more important consequence of the freeze on residency funding is that there are more medical school graduates trying to get into the residency pipeline than there are slots available. So every year, thousands of medical school grads go unmatched. And this is especially an issue for people who did their medical school training outside of the U.S., and that includes Henna Sawhney. She's a U.S. citizen, but she graduated from a U.K. medical school in 2018.

HENNA SAWHNEY: I applied to every program I thought I was eligible, and that ended up being about 300 or 400 programs a year.

MA: Did you get any interviews the first year?

SAWHNEY: No, not my first year, not my second and not my third.

MA: Henna knew that having a foreign medical degree might make it harder for her to find a residency job, but she didn't think it would be this hard. Even after going through the application cycle a fourth and a fifth year, no hospital hired her.

SAWHNEY: My last time applying, I was like, there's literally nothing more I could do. I graduated medical school. I've - I have publications and research. I've been working in public health during a pandemic. And so that's why I was like, I don't know what to do anymore.

WOODS: That's kind of wild. I mean, she wants to get that residency. We have a doctor shortage. I mean, it's very frustrating not to see the supply and the demand meet.

MA: But we have this doctor shortage - some would say a training shortage. So what is the prescription? Well, we asked our experts, Candice and Robert, and they say overhauling the current residency funding scheme is a good start. There's actually a bill that has been kicking around Congress. It's been introduced about 10 times to do just that. It hasn't really gotten anywhere.

WOODS: Meanwhile, some experts like Robert think that states could loosen rules that make it harder for foreign doctors to practice here. Or the states could pass laws allowing nurse practitioners and physician assistants to do more without a doctor around. And a few states are even giving people like Henna, who couldn't get into residency, a limited license to practice medicine with some supervision. And that's what Henna has been doing the last couple of years. But rather than trying to keep getting into residency programs again and again and again, Henna's decided recently to pivot her career towards medical research.

MA: What do you think it says about the system that people like you who can't get in the pipeline?

SAWHNEY: While I was going through it, I thought I was a failure - that I wasn't good enough to get into the system. And now, looking back, I realize it was the system that was failing me and countless others. At the end of the day, honestly, the American public needs these physicians.


MA: This episode was produced by Noah Glick, with engineering from Brian Jarboe. Sierra Juarez and Dylan Sloan checked the facts. Viet Le is our senior producer. Kate Concannon edits the show, and THE INDICATOR is a production of NPR.


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