17 two-thirds (from 54,400 to 92,200), according to the HHS 16 report. Further, in 1970, foreign-trained physicians represented about 17 percent of the physician supply. However, in 1983, there were more than 111,000 such graduates, which represented about 21 percent of the total U.S. physician population.18 Do we have enough physicians? The current aggregate physician supply is probably adequate to meet national needs, but there may be an excess supply by the end of this decade. Two reports have examined the sufficiency of the supply of physicians predicted for 1990 and 2000. reports were generated by the Graduate Medical Education National Advisory Committee (GMENAC)* in September 198019 and HHS in May 1984.20 These Both the GMENAC and HHS reports estimated a future excess aggregate supply of physicians. The GMENAC report predicted an excess supply of 70,000 and 145,000 physicians by 1990 and 2000 2000, respectively. The HHS report predicted an excess of more than 35,000 physicians by 1990 and about 51,800 by 2000.22 Increased physician specialization. In addition to the increasing aggregate supply of physicians, another trend has been an increase in the number of physicians who practice as specialists as opposed to being primary care physicians. A primary care physician is usually the initial point of contact between patients and the medical care system. Generally, primary care physicians provide access to the health care delivery system for those disorders requiring the service of a specialist.23 The medical profession generally recognizes primary care physicians as those in general and family practice, general internal medicine, general pediatrics, and obstetrics/ gynecology, although other physicians, such as general surgeons, frequently provide primary care as well.24 Generally speaking, a specialist is viewed as a physician uniquely qualified to practice in a particular field of medicine 25 by virtue of training, knowledge, and experience. In 1983, more than 80 physician specialties were recognized. 26 Between 1963 and 1982, the percentage of physicians in general practice declined from about 27 to about 12 percent27 while those practicing as specialists increased correspondingly. There are many reasons for increasing specialization among physicians. The growth of medical knowledge, stimulated by financial support for biomedical *GMENAC was established in 1976 to advise the Secretary of HHS on several matters, including the number of physicians required to bring supply and requirements into balance. research through the National Institutes of Health, may be one factor. 28 Also, the increasing complexity of medical technology has emphasized the need for special expertise and training. 29 For The GMENAC report concluded that by 1990 there would be a substantial oversupply of certain specialists, particularly in the specialties of surgery and obstetrics/gynecology. example, the report estimated an excess supply of nearly 12,000 general surgeons, over 10,000 obstetricians/gynecologists, and over 7,100 cardiologists. However, GMENAC also estimated shortages in some physician specialties, such as an undersupply of 8,000 general psychiatrists.30 Does an excess physician supply have an impact on health care costs? Expenditures for physicians' services have increased from $5.7 billion in 196031 to $69 billion in 1983,32 and the Health Care Financing Administration (HCFA) projects that spending for physicians' services could reach $134 billion by 1990.33 Differences of opinion now exist as to whether an excess physician supply will increase or decrease health care expenditures. Some assert that a physician glut will result in overutilization of physician services and therefore increase total health expenditures, while others contend that competition between physicians will lower fees and improve quality of and access to care. Some studies have suggested that the increasing supply of physicians may result in higher expenditures for the following reasons. First, increasing numbers of physicians may simply reduce the percentage of patient need that goes untreated in a market of permanent excess demand. 34 The question of whether or not the services provided are medically necessary has not been addressed. Second, much of the new demand for health care may be generated by physicians, who have wide latitude in determining the type and quantity of care patients receive and the types of settings in which it is delivered. Thus, according to this view, the number of physicians is correlated not only with expenditures for physicians' services, but also with expenditures for hospital care, other professional services, drugs, and 35 so on. Third, physicians may seek to maintain a target income despite declining demand for their services by increasing fees, 36 generating demand, or both. Assuming the validity of the target income hypothesis, the extent to which physicians could maintain incomes would be expected to vary by both specialty and region of the country. For Several studies, however, contradict this hypothesis. instance, a 1983 study of physician pricing and health insurance reimbursement concluded that target net income was not a pervasive characteristic of physicians' economic behavior.37 Moreover, it should be recognized that these hypotheses were based on studies that were generally completed in the 1970's. Since that time, major changes have taken place in the way in which medical care is delivered and financed in the United States. For example, many physicians are developing new practice forms and seeking employment in alternative delivery systems because they are competing to a varying degree with each other as well as with hospitals and free-standing facilities to obtain or retain a viable share of the patient market. 38 Some contend that physician fees may be reduced as a result of this increased competition. What efforts have been undertaken to constrain the supply of physicians? Current federal funding efforts reflect the view that since the perceived physician shortage and access problems have been alleviated, there is no justification to continue incentives to further increase enrollments and graduates. result, the Administration and the Congress have reduced federal support of programs to increase the aggregate supply of physicians.39 40 As a Although federal funding has been substantially reduced, federal funds generally remain the largest single source of aid available to medical schools. In addition, state governments and the private sector have also made significant contributions to the support of medical education in the past. However, recently, the amounts of such aid have also decreased while tuition and fees at many schools have increased.41 The longterm effect of this decrease in public and private sector funding of medical education is likely to reduce the future supply of physicians. In regard to foreign medical school graduates entering the United States to practice medicine, the Congress took some action to limit their numbers by making changes to immigration legislation. Specifically, because of concerns that the quality of education in foreign medical schools may be inferior to that of U.S. and Canadian schools, and, as a result, the adequacy of care provided may be in doubt and because of the large numerical impact of foreign medical graduates, the Congress declared in the Health Professions Educational Assistance Act of 1976, that: "There is no longer an insufficient number of physi- This The legislation placed immigration restrictions on aliens, and also required passage of a more difficult medical exam. legislation and subsequent amendments have helped to reduce the number of aliens entering the United States to practice medicine. 43 For example, total permanent physician immigrants dropped from about 7,100 to about 3,000 from 1972 to 1979.44 FACILITIES The health facilities that dominate the U.S. health care system take many forms, but consist primarily of acute care and specialty hospitals and nursing homes. Some facilities are owned by government agencies. Others are privately operated, either on a nonprofit basis by community or religious organizations, or for profit by proprietary corporations. In 1984, about $176 billion (49 percent of national health expenditures) was spent in providing patient care in hospitals and nursing home facilities.45 Hospitals In the past, hospitals have been the focal point of the health care industry. 46 In 1983, there were 7,044 hospitals with over 1.4 million beds in the United States. Of this number, the majority (5,865 hospitals or about 83 percent) were community hospitals.* The remainder consisted of 343 federal hospitals and other specialized facilities providing long-term care, psychiatric, and other services. In 1983, these hospitals handled over 39 million admissions and provided about 379 million inpatient days of service. In addition, about 275 million outpatient visits were provided.47 Between 1960 and 1983, the total number of hospitals registered by the American Hospital Association (AHA) in the United States grew from 6,876 in 1960 to 7,156 in 1975 and then declined to 6,888 in 1983. During this period, the total supply of hospital beds decreased from about 1.7 million to about 1.3 million beds.48 However, these overall trends obscure the changes that have been occurring in community hospitals. Although there was an overall decline in hospitals during this period, the number of community hospitals increased. Similarly, while overall bed capacity in hospitals declined, the supply of beds in community hospitals increased significantly, as shown in table 2. The increase in the supply of community hospital beds has also occurred at a faster pace than the growth of the U.S. population, as shown in table 3. *Community hospitals consist of all non-federal, short-term (average length-of-stay less than 30 days), general, and other special hospitals, excluding hospital units of institutions whose facilities and resources are available to the public. Table 2 Number and Bed Capacity of U.S. Registereda Hospitals, Selected Years aRegistered hospitals (1) meet 13 requirements specified by the AHA which warrant classification as hospitals and (2) submit proof of meeting these requirements to the AHA. In 1983, non-registered hospitals comprised about 2 percent (156) of all hospitals. bMay not total due to rounding. Source: American Hospital Association. Hospital Statistics, 1984 Edition. (Chicago, IL: AHA), pp. 4 to 7. Source: American Hospital Association. Hospital Statistics, 1984 Edition. (Chicago, IL: AHA), pp. 5 and 7, and data provided by the U.S. Department of Commerce, Bureau of the Census, Population Division. |