Starting Points: Deficit

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Mar 3, 2010

The Doctor Won’t See You Now

A critical shortage of primary-care physicians is yet another symptom of our ailing health-care system.

Published Feb 26, 2010

From the magazine issue dated Mar 8, 2010

After taking a month to regroup, the White House has put health care back at the top of its agenda, asking Republicans for new ideas and trying to regain momentum for old ones. But last week's summit came down mostly to the same old talking points. And even if the president does manage to get some version of health-insurance reform passed in the next few months, he and the country are still going to be dealing with the related crisis of America's doctor shortage. Primary-care physicians, family docs, general practitioners—whatever you call them, they're the country's first line of defense, the ones responsible for promoting preventive care, finding ways to keep people from getting sick in the first place, and thus bringing down costs throughout the system. If every American went to one of these doctors regularly, health-care costs might come down as much as 5.6 percent a year, saving $67 billion, according to one estimate. Yet we don't have nearly enough doctors to make that happen, and fewer are being produced every year.

The annual number of American medical students who go into primary care has dropped by more than half since 1997. It's hard to get an appointment with the doctors who remain. In some surveys, as many as half of primary-care providers have stopped taking new patients. The other half are increasingly overworked and harried. Clearly we need to find a way to increase their ranks, and both the congressional health-care bills and President Obama's reform proposal make moves in that direction. But those efforts are somewhat limited, and a more comprehensive solution could be thwarted by the same thing that's stalled the rest of health-care reform so far: politics.

The reason behind America's doctor gap is a matter of money. The average income in primary care is somewhere in the mid-$100,000s, which sounds like a lot but is less than half what specialists such as radiologists and dermatologists make. Given that doctors may graduate with as much as $200,000 in med-school debt, it's easy to see why primary care started hemorrhaging recruits more than a decade ago and why radiology and other well-paid, high-tech specialties took off in popularity.

The field has since entered a vicious cycle. As fewer people have entered primary care, the doctors who are left have been forced by tight schedules to shortchange some patients, forgoing the long, meandering chats that used to be a big part of checkups in favor of 15-minute, checklist-style appointments. The close relationships that general practitioners once had with patients drew many idealistic students into the field. Now recruiters face an extra-tough sell: they have to convince bright young would-be docs to pursue a career that won't pay very well and won't be as emotionally fulfilling as it once was.

How can schools entice more aspiring doctors into primary care? The Tufts University School of Medicine, to take one example, offers a $25,000-per-year scholarship for med students who agree to work in primary-care practices in rural Maine for much of their training period. Students on this Maine Track start shadowing doctors on the third day of orientation. This year's program drew 257 applicants for just 36 slots.

The problem with the Maine Track is that it doesn't actually require med students to enter primary care after they graduate. It can't, says Peter Bates, chief medical officer at Maine Medical Center, which jointly administers the program with Tufts. "If you're a bright kid with a great future, being told you have to be a family physician in rural Maine—even if that's what you want to do [now]—might strike you as confining," Bates says. "Why would you close down your opportunities?"

There are dozens of training programs like Tufts's around the country, as well as the National Health Service Corps, which pays back loans and hands out scholarships and stipends in exchange for a few years of service in rural areas, where the shortage of primary-care providers is most acute. Obama and the Senate have both called for an expansion of the program in their proposals for reform, which has already received $200 million in stimulus funds. Several new medical schools, including some that focus on primary care, have also recently opened. But all those changes may not be enough to fill the gap. "We need more than half of doctors in this country doing primary care," says Harris Berman, interim dean of the medical school at Tufts. "It's a bigger problem than we can solve with programs like ours."

So what else can be done? Lately, some policymakers have argued that instead of having a primary-care doctor, more people—especially young, healthy patients with simple medical needs—should see a nurse or physician assistant who administers routine care and kicks more complex problems up to a doctor when they arise. "If you're just coming in to have your blood pressure checked and your pulse taken, you really don't need to see a doctor, and you might not need to see a nurse, either," says David Barrett, president and CEO of the Lahey Clinic in Burlington, Mass. "There are three-stripe military sergeants with two-year degrees who can provide excellent primary care. There's absolutely no reason to force all primary-care providers to have an M.D."

The Lahey Clinic is an "integrated group practice"—one of the teamwork-oriented organizations, like the Mayo Clinic and the Cleveland Clinic, that have been lauded for cutting costs and eliminating waste in the health system. In its primary-care service, a "team captain" physician supervises nurses, PAs, and other health-care professionals who perform tasks like checking blood pressure but don't necessarily make formal diagnoses on their own. The problem with taking this approach nationwide is that nurses and PAs are subject to the same economic forces that drive medical students. Almost half of current nurse practitioners and physician assistants work in specialty practices, where the money is. Then there's the fact that the country already has a nursing shortage. How are nurses going to replace doctors if there aren't enough nurses to begin with?

There's one more group of people, foreign medical graduates, who could theoretically fill in for the missing primary-care providers. The trouble is, they're already doing that. More than a quarter of primary-care doctors currently practicing in the United States have gotten their diplomas abroad. Increasing their numbers would be problematic for both the left (which might object to poaching doctors from developing countries that need them) and the right (which would surely object to recruiting non-Americans to do a job that reliably pulls in six figures, especially when unemployment is high).

Inevitably, then, the solution to the primary-care crisis is going to have to involve something simpler: paying primary-care providers more, so as to draw more bright young physicians into the field. At least it sounds simpler. But even this turns out to be maddeningly complex.

Most primary-care doctors, like all other physicians, are paid bit by bit for each medical task they perform (unless they work somewhere like the Lahey or the Mayo, which pay set annual salaries). Private insurers decide how much they'll reimburse docs for each task partly by looking to Medicare's policies for guidance. Medicare, in turn, makes its decisions by committee. Here is the bad news for primary-care docs: most of the physicians on the committee that sets the reimbursement rates are specialists. Medicare—and, consequently, private insurance—doesn't reimburse primary-care doctors as lavishly as it does their more specialized counterparts. That's why primary-care incomes are relatively low in the first place.

Changing anything about the way primary-care providers are paid will be immensely complicated. For one thing, rural doctors sometimes perform specialized procedures because no one else is available—would they still qualify for a raise? And then, what exactly constitutes a task that should be reimbursed? For a high-tech specialist, this is often clear-cut: each scan or chemical test counts. But what about all the things primary-care doctors do that don't involve technology? "You don't get paid to talk to people and tell them to stop smoking. Nobody values my time to do that," says Joe Gravel, a family physician and chief medical officer at the Greater Lawrence Family Health Center in Massachusetts. "They'll pay for the lung transplants, but they won't pay to prevent 50 people from needing them."

In January, Medicare raised reimbursement rates for some primary-care services by about 4 percent, and its payment committee will call for another small increase this week. That's a good start, says Lori Heim, president of the American Academy of Family Physicians, but "if you're talking about changing the way students view primary care, it needs to be more like 25 percent, and that's on the low side." Both the House and Senate reform bills also include a slight increase in primary-care payments—5 and 10 percent, respectively.

To fund such a pay raise, Congress would either have to spend more money on health care or pinch some from the specialists by lowering their pay rates. The first strategy is clearly controversial—no one wants to increase health-care costs further. The second, budget-neutral strategy is bound to tick off the specialists. Peter Mandell, a spokesman for the American Academy of Orthopaedic Surgeons, sent a clear message last year when the Medicare reimbursement committee suggested a 10 percent shift in payments toward primary-care docs and away from specialists. Telling The New York Times that his group had "a problem" with the idea, Mandell added, "If there's less money for hip and knee replacements, fewer of them will be done for people who need them." It's a short step from his polite, reasonable statement to rallies over the specter of rationing.

So here is the fundamental dilemma of the primary-care crisis: One of the solutions with the best chance of working is politically unpalatable, and even those who support it admit it's a bureaucratic nightmare. But without it,we may be heading for an even bigger disaster that nobody wants. Does this sound familiar? The cure for primary care, it turns out, is ultimately going to be the same thing that's needed to fix the rest of the health-care system: political will.

Aug 29, 2009

Tax Pledge Is a Target As Deficits, Debt Grow - washingtonpost.com

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By Lori Montgomery
Washington Post Staff Writer
Saturday, August 29, 2009

During last year's campaign, President Obama vowed to enact a bold agenda without raising taxes for the middle class, a pledge budget experts viewed with skepticism. Since then, a severe recession, massive deficits and a national debt that is swelling toward a 50-year high have only made his promise harder to keep.

The Obama administration has insisted that the pledge will stand. But the president's top economic advisers have refused to rule out broad-based tax increases to close the yawning gap between federal revenue and government spending and are warning of tough choices ahead.

Republicans are already on the attack, accusing Obama of plotting to break his no-tax vow, the same political transgression that cost Democrats control of Congress under former president Bill Clinton and may have cost president George H.W. Bush his job. Democrats say Obama is highly unlikely to break the pledge before next year's congressional election and observe that it would be safer to wait until his second term if a tax increase becomes unavoidable.

Some lawmakers are focused instead on setting up an independent commission to solve the deficit problem. Senate Budget Committee chairman Kent Conrad (D-N.D.) plans to hold hearings on the topic when Congress returns to Washington this fall.

Obama, meanwhile, has vowed to pay for any new initiatives and to draft an overhaul of the health-care system that eventually would save the government money, driving deficits down. But effective health reforms would take decades to produce savings. In the meantime, White House budget director Peter R. Orszag acknowledged, "there are additional steps that will be necessary."

"The administration is very concerned about these [future] deficits, and getting those deficits under control is a top priority of the administration," Orszag told reporters this week as he rolled out a new economic forecast that added $2 trillion to deficit projections from 2010 to 2019.

Treasury Secretary Timothy F. Geithner and White House economic adviser Lawrence H. Summers have both delicately sidestepped the tax question on Sunday talk shows. Orszag has also refused to discuss what steps Obama might take to reduce the deficit in the budget blueprint he will present to Congress in February. But budget analysts say he has few real options.

"If you rule out inflating our way out of the problem and defaulting on the debt, there are two ways: Cut spending or raise taxes," said William G. Gale, an expert on fiscal policy at the Brookings Institution. With more than 80 percent of federal spending devoted to politically untouchable programs such as Social Security, Medicare and Medicaid, he said, "it's going to be really hard to make significant headway on the spending side. So that means you've got to think about taxes."

Spending cuts were a big part of the solution the last time the nation faced such a towering debt. In the aftermath of World War II, with the debt exceeding the country's entire economic output, the government slashed military expenditures. Within two years, Washington was spending less than it took in. Fifteen percent inflation also helped by reducing the real value of the debt. When the country went to war again in Korea and then Vietnam, tax increases helped keep the budget largely in balance and the debt continued to fall.

Today's problem is more complex. Obama not only faces the fallout from the worst economic downturn in 30 years, but also inherited the debt piled up by his predecessor, Republican George W. Bush. Bush invaded Iraq and approved an expensive new prescription drug benefit for the elderly while pushing through one of the biggest tax cuts of the post-war era -- worth an estimated $1.6 trillion in foregone revenue by the time the provisions expire next year. This was the first time the United States had not adjusted its fiscal policy to meet its wartime needs, according to "The Price of Liberty," a book on war financing by Goldman Sachs vice chairman Robert D. Hormats.

After running surpluses in the late 1990s, the government began spending far more than it took in, forcing the Treasury to increase borrowing from China and other creditors. During the Bush administration, the portion of the debt held by the public jumped from just over $3 trillion to nearly $6 trillion. Federal rescue efforts in the face of last fall's financial meltdown have rapidly driven the debt higher. Today it stands at nearly $7.4 trillion, or about 52 percent of the overall U.S. economy.

"There's no question in my view that Bush was the most fiscally irresponsible president in the history of the republic," said David M. Walker, the comptroller general under Bush who now advocates for deficit reduction. Obama "was handed a bad deck," he said. "But the question is, are you making it better or not? And so far the answer is no."

Obama campaigned on a promise not to raise taxes for anyone earning less than $250,000 a year -- about 97 percent of taxpayers. As part of the pledge, he said he would keep some of the Bush tax cuts, including a new 10 percent rate for the lowest bracket, a higher tax credit for children and a lower penalty for married couples filing jointly. He planned to let other Bush tax cuts that benefit mainly the wealthy expire, a move that would raise rates for the top two income brackets. He also proposed to finance a major expansion of health coverage by placing new tax increases on the rich. When he unveiled his first budget, Obama predicted that his fiscal policies would stabilize the debt at around 70 percent of the economy.

This week, after updating the budget to reflect the depth of the recession, the White House conceded its earlier predictions had been wrong. With unemployment now expected to top 10 percent, the government will be forced to spend more on unemployment benefits, food stamps, Medicaid and other safety-net programs. With wages more deeply depressed, tax collections have fallen further than expected. And with the economy likely to rebound more slowly than the White House once thought, those costly conditions will linger for at least the next two years.

The result: deficits of well over $1 trillion through 2011, which will push the debt to 71 percent of the economy by the end of Obama's first term -- the highest since 1954 -- and cause the debt to keep rising in the years beyond.

The sour economy also will increase the cost of some of Obama's initiatives. The economic stimulus package approved in February is likely to cost "tens of billions of dollars" more than $787 billion, Orszag said. Obama's plan to expand federal student loans will cost $27 billion more over the next decade "as more individuals choose to go to college in the weakened labor market," White House budget documents say. And tax increases for the wealthy won't bring in quite as much money as Obama had hoped, budget documents say, because even the wealthy are not earning as much.

Obama could try to cut spending, but his budget is probably already more frugal than politics will bear, budget analysts say. For example, the White House assumes that spending on federal agencies other than the Pentagon will be lower in 2019 than it is next year.

And the fastest-growing budget category is one Obama cannot touch: interest payments on the debt. These are likely to rise as the world demands higher interest rates in return for continuing to sate Washington's voracious appetite for credit. The White House projects interest payments will quadruple by 2019, when debt service will account for nearly the entire budget deficit. At that point, much like a family that has run up big credit card balances, the debt will continue to grow even if the nation all but stops borrowing money.

"We are entering a dangerous debt cycle," said Maya MacGuineas, president of the bipartisan Committee for a Responsible Federal Budget. "We don't know when interest rates will go up, but when they do, you can see that they will have a huge impact."

By contrast, Obama could raise taxes without taking any legislative action. If he let all the Bush tax cuts expire next year and refused to enact legislation to restrain the alternative minimum tax, deficits would be about $200 billion a year lower and the debt would stop growing as a percentage of the economy, according to Gale's analysis of new data from the nonpartisan Congressional Budget Office. But that would mean big tax increases for most American families, violating Obama's pledge.

Whatever course Obama takes, Geithner said earlier this month that the economy cannot fully recover until deficits are brought under control.

"We have to bring these deficits down very dramatically," Geithner told ABC News. "And that's going to require some very hard choices."