Obamacare: Not enough doctors in CA to meet demand

[_Quasimodo]

Quasimodo, Cinepro's point is just as valid as if we were talking about sacks of wheat or jelly beans. If we are talking about the quantity of services demanded, we have to look at the marginal cost of the services, i.e., how much will I be charged out of pocket if I decide to consume a particular medical service. Paying a mandatory monthly fee (premium) does not affect the marginal cost of the service -- I have to pay the monthly fee whether or not I avail myself of the service.

Well, sort of.

Medical insurance companies (especially HMO's) have been dictating medical pricing since the Reagan administration. Insurance companies with larger groups of participants are able to bargain down prices from doctors and hospitals. This gives them a little edge on pricing to gain more customers. Of course, the fewer services they allow their customers to avail themselves of, the more profit the company makes. A problem inherent with having a corporate middleman to administrate care.

100% of people in this country will require very expensive medical care at some point in their lives (unless they are run over by a garbage truck and die instantly). Your 'out of pocket' monthly fee goes towards covering the costs of older people in the program that require expensive care and as a payment towards the time when you will, as well. That's how insurance works whether private or public. I'm not sure it's possible to separate this fact from the basics of a free market economy.

That isn't to say that a private insurance system, or a public insurance system, or no system at all is the best system. It just means that, if we reduce the out of pocket costs for medical services by allowing more people to be insured, we should expect the quantity of medical services demanded to increase.

Obviously, the greater number of people that are covered by medical insurance (public or private), the greater the demand will be on medical services. More medical professionals will need to be employed. More clinics and hospitals will need to be built.

I don't see a down side to this. More people employed, more people receiving the care they need.

[_EAllusion]

Poorer folks would fall under Medicaid. And yes, I know, it comes from tax revenues. Most of these people pay into that, so they are effectively paying for their own care.

They're not paying the real cost of the service. Being able to pay a very small amount for a much larger banquet table of services that would sell for much higher on the open market has distorting effects on supply and demand.

[_Res Ipsa]

Quasimodo, I'm a single payer fan myself. But in anything as complex as the ACA, there are downsides. For example, how exactly will we employ more medical professionals? Increase pay for doctors? Regulate or subsidize medical school tuition? Lower the standards for licensing MDs?

I'm not saying we should allocate health care through a completely free market system. (Single payer -- remember?) But neither should we ignore the effects of the ACA on supply and demand.

[_cinepro]

The medical world is changing.

It might be changing, but is it changing fast enough, and will the medical establishment be able to stop this change in time?

Hernandez's proposed changes, which would dramatically shake up the medical establishment in California, have set off a turf war with physicians that could contribute to the success or failure of the federal Affordable Care Act in California.

Doctors say giving non-physicians more authority and autonomy could jeopardize patient safety. It could also drive up costs, because those workers, who have less medical education and training, tend to order more tests and prescribe more antibiotics, they said.

"Patient safety should always Trump access concerns," said Dr. Paul Phinney, president of the California Medical Assn.

Such "scope-of-practice" fights are flaring across the country as states brace for an influx of patients into already strained healthcare systems. About 350 laws altering what health professionals may do have been enacted nationwide in the last two years, according to the National Conference of State Legislatures. Since Jan. 1, more than 50 additional proposals have been launched in 24 states.

http://articles.latimes.com/2013/feb/09 ... s-20130210

[_Kevin Graham]

They're not paying the real cost of the service. Being able to pay a very small amount for a much larger banquet table of services that would sell for much higher on the open market has distorting effects on supply and demand.

That's the beauty of collective spending. Do you really think any of us are paying, via taxation, the real costs of the benefits and services afforded us by our government? Don't be so naïve. Even those millionaires and billionaires who pay millions in taxes every year, couldn't ever hope to use that money to pay for these things on their own.

Do you really not understand how this works? When everyone pays and everyone participates, it becomes more affordable for everyone.

The reality is we all pay taxes and we should all have a say in how those taxes benefit everyone. Never was it the case in American history that this logic held water, saying the minority who pays more taxes get to determine what those taxes can be used for. Republicans began that philosophy in their attempt to create class warfare. They want to bitch about taxes being used to save the lives of millions of Americans via healthcare (oh what a horrible idea!), but at the same time they have absolutely no problem using ten times that amount to fund military campaigns to avenge the deaths of a few thousand Americans.

Republicans have no priorities that are based on any sense of morality. I've come to that realization. Their concerns with abortions was their last saving grace until they overwhelmingly reject any government funding of the only measure that has shown to dramatically reduce abortions. Because you know, it is much better to wage multi-million dollar campaigns threatening the rights of women, than it is to pay out a few pennies a month to cover contraceptives for everyone insured.

They are against the poor and working class at every turn. Last night when my wife was asking about the minimum wage increase, she wondered if the Republicans would support it. I laughed out loud because all she had to do was ask herself who benefits the most. If the poorer class benefits from any proposal, the Republicans are against it. If the wealthy and corporations have to pay a little more, then they are against it. Period. I can't think of a single exception, can you?

[_EAllusion]

One of the effects of Pell Grants, which are designed to make college education more equitably affordable, is that they cause universities to raise tuition prices due to the artificial inflation of demand that program causes. Prices rise to capture the "free" funding. Universities do stuff with that increased revenue, so the result is you get a better, more expensive service. You can write a 75 page treatise on why you think Pell Grants are justified that still wouldn't change that basic underlying fact.

Likewise, one of the effects of making health care essentially free to a large number of consumers, meaning that they have to pay far, far less than the what an efficient market would dictate regardless of economy of scale, is that demand for those services will spike and draw down supply. You can support this program while understanding the distorting effect it creates. Brad understands this.

They are against the poor and working class at every turn. Last night when my wife was asking about the minimum wage increase, she wondered if the Republicans would support it. I laughed out loud because all she had to do was ask herself who benefits the most.

It benefits large corporations who are in fields with min wage workers the most. It allows companies like Wal*Mart to price out their competitors by being better equipped to deal with higher costs on the labor supply. That's why they 1) lobby for increased min wage while 2) not paying more than the min wage. It's also why you can get politicians in the pocket of big business interests to vote for increased min wages. The people it hurts the most are small businesses that have less capacity to take a significant hit to their labor costs.

Minimum wages have the potential to cause unemployment if they are above the market price of labor. And if they are below the market price of labor in a given field, then people would've made min wage+ anyway. If they are raised high enough, they inevitably cause unemployment and increase black market sub-min wages. So you get fewer, better paid workers plus a larger workforce that exists outside of fair employment regulations. Further, min wages are known to have a psychological effect on labor negotiations by setting a baseline of comparison for what people accept as fair. If they are too low, it has the the unfortunate side effect of depressing wages. You might be tempted to say, "Then the government shouldn't set it too low or too high," but the problem is that the real cost of labor in a given field in a given area fluctuates constantly and it's not possible for a command economy to know what it should be. It's not all lack of concern for the poor that drives opposition to min wage laws or any proposal to increase them.

[_Kevin Graham]

How does any of this change the fact that poor taxpayers have just as much right as the wealthy to dictate what the government does with tax revenue?

Why is it that whenever some communist lefty talks about tax payer programs designed to help the poor, all we hear from virtuous conservatives is that they shouldn't be "forced" to pay for someone else's problems, and so therefore we should rid ourselves of these programs?

Can you please explain why forcing a lefty to pay taxes to support things he or she doesn't like, is somehow different from forcing a conservative to pay for things he or she doesn't like?

And this isn't even getting into the merits of each side's proposals (i.e. saving lives via healthcare vs. killing people via military funding).

[_Kevin Graham]

One of the effects of Pell Grants, which are designed to make college education more equitably affordable, is that they cause universities to raise tuition prices due to the artificial inflation of demand that program causes. Prices rise to capture the "free" funding. Universities do stuff with that increased revenue, so the result is you get a better, more expensive service. You can write a 75 page treatise on why you think Pell Grants are justified that still wouldn't change that basic underlying fact.

But it isn't a "fact" at all. You're now propagating Right Wing myth.

In a post on The New York Times' Room for Debate blog, Sandy Baum, a senior policy analyst at the College Board wrote:

The average size of a Pell Grant has increased over time, but it is this increase in use of the program that explains most of the increase in expenditures. Because college prices have risen more rapidly than grant levels, Pell covers a lower proportion of total college expenses than it did a decade ago.

There are a number of explanations for rising college prices, with declining state appropriations per student high on the list for public colleges and universities. Difficulties in improving efficiency and productivity, expansions in the services offered to students, rising costs of technology, and increases in institutional financial aid budgets are also major factors. There is no convincing evidence that increases in Pell Grants feed tuition increases in either public or private not-for-profit institutions.

Baum included this chart demonstrating the total cost of college outpacing the rise in maximum amount awarded by Pell Grants:

In the same New York Times blog, Patrick Callan, the president of the National Center for Public Policy and Higher Education, wrote:

Federal Pell grants have served to partially insulate low income college students from three decades of escalating tuition increases. With the current maximum grant level of $5,350 and most students not eligible, there is little evidence that these means-tested grants are major factors in the tuition setting decisions of most colleges.

Today the grants cover a smaller portion of college tuition than they did 25 years ago; if colleges had calibrated tuition increases to Pell Grants, steep tuition increases would not have been repeatedly imposed in the years when the grant levels were not raised and tuition would be considerably lower today.

[...]

As long as tuition continues to grow faster than family income and other prices in the economy and faster than Pell grant levels, American students and families will continue to lose ground in college affordability. Pell Grants are a critical part of the safety net that helps many low income Americans enroll in college. These grants do not cause higher tuition, but runaway tuition undermines their effectiveness in supporting access for low income students. [The New York Times, 2/3/10]

A July 12 analysis of federal educational aid by the New America Foundation showed that " the purchasing power of the Pell Grant has decreased over the past 30 years as the price of college has risen." From the New America Foundation:

In fiscal year 1976, the first year that the Pell Grant program was fully funded at its authorized level, the maximum Pell Grant was $1,400 and covered 72 percent of the cost of attendance at a typical four-year public college. Despite regular increases in funding and grant levels, the purchasing power of the Pell Grant has decreased over the past 30 years as the price of college has risen. In the 2009-10 school year, the maximum Pell Grant covered 36 percent of the cost of attendance at a typical four-year public college.

The analysis included a chart showing the decrease in the percentage of tuition covered by the Pell grant program since 1976:

[_Kevin Graham]

Minimum wages have the potential to cause unemployment if they are above the market price of labor. And if they are below the market price of labor in a given field, then people would've made min wage+ anyway.

Another Right Wing myth.

So you get fewer, better paid workers plus a larger workforce that exists outside of fair employment regulations. Further, min wages are known to have a psychological effect on labor negotiations by setting a baseline of comparison for what people accept as fair.

Uh huh. And how exactly did the spike in minimum wage increases affect employment during Reagan and Bush? You seem hell bent on trying to figure out ways to explain how something could turn out bad, based on nothing but speculation, while ignoring evidence and what what we know from history.

According to a 2004 report by the Fiscal Policy Institute:

We do not know enough from this analysis to conclude that increasing the minimum wage will boost employment growth over what it otherwise would have been. What does seem to be clear, however, is that it is hard to sustain the argument made by some observers that an increase in the minimum wage will result in adverse aggregate employment outcomes.

The analysis of employment and payroll data in this report -- across all states since the last increase in the federal minimum wage -- suggests that it is hard to argue that, in the aggregate, all businesses, or all small businesses, will be adversely affected by higher minimum wages. [Fiscal Policy Institute, 4/20/04]

According to a 2006 report by the Fiscal Policy Institute:

Some observers contend that because many small businesses are labor intensive and largely employ low-wage workers, they will experience sharp cost increases when the minimum wage is increased, leading them to reduce employment levels. However, this report examined recent state-by-state trends for small businesses employing fewer than 50 workers and found that employment and payrolls in small businesses grew faster in the states with minimum wages above the federal level than in the remaining states where the $5.15 an hour federal minimum wage prevailed.

This report also found that total job growth was faster in the higher minimum wage states. Faster job growth also occurred in the retail trade sector, the sector of the economy employing the most workers at low wages, in the higher minimum wage states. [Fiscal Policy Institute, 3/30/06]

According to the Fiscal Policy Institute:

FPI also has analyzed employment growth in New York State. From December 2004, the month preceding the first New York State minimum wage increase, to December 2007, total employment in the state has grown by 3.0 percent. In the retail trade and food services industries--the largest employers of minimum-wage workers--employment has risen by 3.3 percent. While these figures are smaller than the averages for the entire U.S. (4.4 percent and 4.8percent, respectively), the ratios of change of low-wage industry employment to overall employment are comparable (1.10 for New York State and 1.09 for the U.S.). In other words, the number of jobs in these heavily low-wage industries rose just as quickly in New York State relative to overall job growth as it did at the national level. These results do not support the prediction that the increases of the state's minimum wage between 2004 and 2007 would stymie growth in New York's low-wage industries. [Fiscal Policy Institute, 7/10/08]

According to a 2006 UC Berkeley Institute of Industrial Relations Policy Brief:

During the debates preceding the votes on both cities' laws, businesses threatened to leave if a minimum wage were enacted. In this brief we have reviewed the economic impact studies conducted for San Francisco and Santa Fe, the two cities with citywide minimum wages. These studies, which both use sophisticated statistical techniques, found no significant impact on employment or business closures. [IIR Policy Brief, September 2006]

According to a UC Berkeley Institute of Industrial Relations Policy Brief:

In Table 3, we have taken the 2006 listing of the top 100 retailers (ranked by annual revenue) and indicated the businesses and number of stores that each retailer currently operates in San Francisco and Santa Fe.

Each city has a healthy representation of the nation's largest retailers, many with multiple stores and all paying the city's minimum wage. Indeed, Sam's Club in Santa Fe voluntarily started paying the higher minimum wage even before the law went into effect, and Wal-Mart is now building a new SuperCenter in the city. In San Francisco, Home Depot recently agreed to open its first store in the city and to pay an even higher wage of $10.77.

In Table 4, we compare the presence of the nation's top retailers in San Francisco before and after the city-wide minimum wage went into effect. As the table indicates, the number of different businesses and the number of stores in the city increased after the minimum wage policy was implemented. After combining the 2003 and 2006 top 100 lists, we found that 68 retailers maintained a market presence in the Greater SF Bay Area market in 2003 and/or 2006. Among these 68 retailers, 47 had stores in San Francisco in 2003, increasing to 52 retailers in 2006, while the number of stores operated by these retailers increased from 207 to 241.

Taken together, the results in these two tables indicate that cities with minimum wage policies do not experience an exodus of major retail businesses. [IIR Policy Brief, September 2006, emphasis added]

According to a CBS News article:

Legislative leaders from New York, New Jersey and Connecticut are pushing a novel, unified approach to promote higher minimum wages, hoping to spur a national movement and eliminate a major argument of opponents in the Northeast who say hikes hinder a state's competitiveness.

The Democrats want to increase the minimum from $7.25 an hour to about $8.50 in New York and New Jersey, and to about $9.75 over two years in Connecticut, where it's $8.25. There are several active proposals in the states. [Associated Press, 3/7/12]

According to a study by Arindrajit Dube, T. William Lester, and Michael Reich published in the November 2010 The Review of Economics and Statistics:

In this paper, we use a local identification strategy that takes advantage of all minimum wage differences between pairs of contiguous counties. Our approach addresses the twin concerns that heterogeneous spatial trends can bias the estimated minimum wage effects in traditional approaches using time and place fixed effects, and that not accounting for spatial autocorrelation overstates the precision in individual case studies.

For cross-state contiguous counties, we find strong earnings effects and no employment effects of minimum wage increases. By generalizing the local case studies, we show that the differences in the estimated elasticities in the two sets of studies result from insufficient controls for unobserved heterogeneity in employment growth in the national level studies using a traditional fixed-effects specification. The differences do not arise from other possible factors, such as using short before-after windows in local case studies. [The Review of Economics and Statistics, November 2010, emphasis added]

According to an op-ed by Donald Cohen, Director of the Cry Wolf Project:

The California Chamber has opposed every proposed increase in the state's minimum wage in recent memory, describing it as the ultimate "job killer." In 1996, voters adopted Proposition 210 to raise the state minimum wage in two steps from $4.75 to $5.75 in 1998. California's minimum wage had been stuck at $4.25 since 1988 until the October 1996 Federal Minimum increase to $4.75. per hour. The Chamber claimed that year's proposed increase was a "job killer" that would disrupt small business and damage the state's economy. But contrary to the predictions of doom, 1.1 million jobs were created in California in the five years after Proposition 210 passed. [Cry Wolf Project, 5/19/11]

According to a study by the Federal Reserve Bank of Chicago:

First, a $1 minimum wage hike increases total spending by approximately $700 per quarter in the near-term. This exceeds the roughly $250 per quarter increase in family income following a minimum wage hike of similar size. These patterns are corroborated by independent data showing that debt rises substantially after a minimum wage increase. Second, the majority of this additional spending goes toward durable goods, in particular vehicles. Consequently, the spending response is concentrated among a small number of households. Third, total spending increases within one quarter of a minimum wage increase and not prior, despite legislation typically passing 6 to 18 months before enactment. Finally, high levels of durables spending and debt accumulation persist for several quarters after a minimum wage hike. [Federal Reserve Bank of Chicago, 2/8/11]

But I guess all this means nothing. After all, I haven't provided any survey data from a majority of economists, so this all must be a bunch of bunk. Your baseless speculation about what "could" happen if minimum wages increased, is clearly more credible than anything I've provided.

But seriously, when minimum wages increase, corporations don't like it because it cuts into their profits. It doesn't take from taxpayers, it doesn't mean people are getting something for free. It just means they are getting paid something closer to what they're worth. Capitalism survives by paying employees less than what they're worth, while pocketing the difference. The problem is minimum wages haven't kept pace with inflation. Fifty years ago a man could support a family of four selling milk door to door or driving a bus. Nowadays, people have to work multiple jobs because the minimum wage is pathetically low.

But there is no credible evidence to suggest companies will stop hiring if they have to pay a fairer wage. That's just idiotic. Anyone running a company is going to need employees because employees produce the goods and services that provide them with profit. And as long as the minimum wage applies universally to all companies (otherwise giving some a competitive edge) there is no reason to think McDonalds (for example) will close shop because their workers have to be paid $9, or even $20 for that matter. They will still sell their Big Macs because there is a demand, and that demand provides them with profit. The only possible downside is that if minimum wages become so high that companies decide that it would be more cost efficient to invest in technology (i.e. automatic, self service check out) as some grocery stores have been doing. But an increase to $9 is hardly enough to make that happen.

[_Quasimodo]

It might be changing, but is it changing fast enough, and will the medical establishment be able to stop this change in time?

I'm confused why you would want the medical establishment to stop the changes. The AMA has done a good job of keeping the upper tier of the medical profession a closed shop. I'm not sure that is in the best interests of the public.

I agree that doctors should be of the highest caliber, but that is certainly not always the case right now. I work with doctors on a daily basis and began my career working in conjunction with a medical school and a teaching hospital.

Most of the doctors I work with these days are remarkably skilled, but I have worked with many more in the past who would not have made a very good nurse. This doesn't mean they are not good people, just not good doctors.

I also know quite a few nurse practitioners that would more than qualify as good doctors. One in particular who's knowledge, skills and concern for patients far exceeds the physician she works for.

There is plenty of room for more medical professionals and even more intelligent, caring people to fill those roles. This is something that the AMA is going to have to learn to deal with.