Physicians less interested in managed care and Medicare

Doctors in state fleeing HMOs: Consumer advocates alarmed by trend

In numbers that are alarming consumer advocates, doctors are closing their practices to new HMO enrollees and dropping out of “preferred provider” insurance contracts that offer discounted rates for patients. A recent UCSF survey found that only 58 percent of California doctors were accepting new HMO patients.

Doctors are experimenting. Some limit their practices to patients who pay cash up front; others are requiring hefty retainer fees of a smaller group of patients happy to pay extra for more personalized care.

Some are simply giving up. For Palo Alto physician Dr. Richard Lenon, quitting medicine was “the only honorable solution.”

The 58-year-old internist, tired of the paperwork and low fees from health insurance plans, is closing his 24-year-old practice this month, and plans a solo bicycle trip to Chicago.

“Doctors have been trying to get out from under the yoke of what managed care has done to them, and to their sense of professionalism,” said Dr. William Andereck, a San Francisco physician who was among the first to embrace HMOs — and among the first to leave them.
The increasing turmoil in the medical world does not bode well for patients in search of a doctor in a seller’s market.

This article tells us several things. First, we are developing a supply and demand mismatch. We clearly see this in Birmingham. More patients need generalists than our current supply of generalists supports. Moreover, less physicians are becoming generalists. So what will happen?

We will soon see a pendulum shift. Income and lifestyle are the keys to attracting medical students to residencies. As the supply demand mismatch accelerates (and I predict it will), conditions for generalists will have to improve. Generalist’s incomes will increase for simple economic reasons. Then students will choose generalist fields, and internal medicine residents will more often become generalists rather than specialists.

Given the supply demand mismatch, generalists will redesign their practices to the benefit of their lifestyle. Insurers will start to court generalists once again. This will also occur for some specialities which currently have an undersupply of physicians.

The marketplace will adjust, albeit a bit slowly. Should we have to rely on the marketplace for these adjustments? Apparently we have no choice in an economically free society. Is this good for health care? I do not think so. I think we have too few generalists in the pipeline, because the economic forces turned the pendulum several years ago. But it is about to turn – or so I predict.