Our mentor has always been Hippocrates,
not Adam Smith --President of a County Medical Society at
an AMA meeting quoted in the February 16, 1981 issue of the
New York Times.
The American Medical Association (AMA) will
celebrate the 100th anniversary of its Council on Medical
Education. The medical establishment understandably sees the
formation of the Council as a good thing. However, some
patients aren't ready to celebrate yet, and their instincts
may be good.
History
The American Medical Association (AMA) was founded in 1847
around two propositions: one, all doctors should have a
"suitable education" and two, a "uniform elevated standard of
requirements for the degree of M.D. should be adopted by all
medical schools in the U.S." In the days of its founding AMA
was much more open--at its conferences and in its
publications--about its real goal: building a
government-enforced monopoly for the purpose of dramatically
increasing physician incomes. It eventually succeeded,
becoming the most formidable labor union on the face of the
earth.
AMA's initial drive to increase physician incomes was
motivated by increasing competition from homeopaths (AMA
allopaths use treatments--usually synthetic--that produce
effects different from the diseases being treated while
homeopaths use treatments--usually natural--that produce
effects similar to those of the disease being treated). This
competition did serious damage to the incomes of AMA allopaths.
In the year before AMA's founding, the New York Journal of
Medicine stated that competition with homeopathy caused "a
large pecuniary loss" to allopaths. In the same issue, the
dean of the school of medicine at the University of Michigan
railed against competition because it made treating sickness
"arduous and un-remunerative."
Apart from reversing rapidly declining incomes, allopaths also
wanted to rescue their public reputations, which quite
reasonably suffered given their proficiency in killing
patients through such crude practices as bloodletting ("exsanguination")
or mercury injections (poisoning). A few allopaths desired
adulation normally reserved for star athletes and actors. The
Massachusetts Medical Society opined in 1848 that physicians
should be "looked upon by the mass of mankind with a
veneration almost superstitious."
Shut 'em Down
The curse of medical education is the
excessive number of schools --Abraham Flexner, 1910.
To accomplish the twin goals of
artificially elevated incomes and worship by patients, AMA
formulated a two-pronged strategy for the labor market for
physicians. First, use the coercive power of the state to
limit the practices of physician competitors such as
homeopaths, pharmacists, midwives, nurses, and later,
chiropractors. Second, significantly restrict entrance to the
profession by restricting the number of approved medical
schools in operation and thus the number of students admitted
to those approved schools yearly.
AMA created its Council on Medical Education in 1904 with the
goal of shutting down more than half of all medical schools in
existence. (This is the Council having its 100th anniversary
celebrated in Chicago this weekend.) In six years the Council
managed to close down 35 schools and its secretary N.P.
Colwell engineered what came to be known as the Flexner Report
of 1910. The Report was supposedly written by Abraham Flexner,
the former owner of a bankrupt prep school who was neither a
doctor nor a recognized authority on medical education. Years
later Flexner admitted that he knew little about medicine or
how to differentiate between different qualities of medical
education. Regardless, state medical boards used the Report as
a basis for closing 25 medical schools in three years and
reducing the number of students by 50% at remaining schools.
Since AMA's creation of the Council a century ago, the U.S.
population (75 million in 1900, 288 million in 2002) has
increased in size by 284%, yet the number of medical schools
has declined by 26% to 123. In terms of admissions limits, the
peak year for applicants at U.S. schools was 1996 at 47,000
applications with a limit of 16,500 accepted. This works out
to roughly 64% of applications rejected. On a micro level, for
the last six years the University of Alabama (hardly a beacon
of prestige in the medical discipline) has averaged about
1,498 applicants per year with an average of about 194
accepted. This is about an 87% rejection rate. The sizes of
the entering classes have been of course even smaller,
averaging about 161.
AMA would likely argue that there's nothing necessarily wrong
with very high rejection rates. This is correct, except for
the fact that these rates are being applied to pools of
candidates who are cream-of-the-crop in quality and have put
themselves through a very costly admissions process. Current
admissions practices could still be justified by what Milton
Friedman (1982, p. 153) refers to as a "Cadillac standard."
(Getting away from the pop-culture anachronisms of the 1960s,
let's say "Lexus standard" a la the government decides that
every driver today deserves nothing less than Lexus quality.)
Applied to health care, the benefits of a Lexus standard could
supposedly offset the costs of rejecting many ostensibly
qualified applicants.
Quality
The first problem with asserting the existence of a Lexus
standard in health care from very stringent admissions
policies are the contradictions introduced by current racial
and sexual preferences. The Center for Equal Opportunity found
that at a sample of six medical schools, more than 3,500 white
and Asian candidates were not admitted in spite of having
higher undergraduate grades and MCAT scores than Hispanic and
African-American applicants who were admitted in their place.
The Center's study didn't touch on sex discrimination but
undergraduate science professors indicate that it clearly
exists as well.
The second blowout on our shiny Lexus would be the number of
unnecessary/questionable procedures performed on patients
every year. Ex-surgeon Julian Whitaker (1995) tirelessly rails
against the excesses of angioplasty (PTCA), atherectomy
(directional and rotational), and coronary bypass. Whitaker
states that, with few exceptions, all three procedures for
heart-disease patients have been empirically shown to be utter
failures in terms of solving short-term problems without
creating long-term problems which are much worse.
The first complete study of bypass effectiveness was the
Veterans Administration Cooperative Study. Between 286
patients who received bypass surgery and 310 who did not, the
survival rate at the end of 3 years was 88% for the bypass
group and 87% for the control group. In an 8-year follow-up to
a second VACS study among 181 low-risk patients, the bypass
group had a much higher cumulative mortality rate (31.2%)
compared to the non-surgery group (16.8%). This was among a
group of low-risk patients to begin with.
A Rand study revealed that nearly 50% of bypass operations are
unnecessary. Whitaker notes that the number of bypass
surgeries since this Rand study, which should have plummeted,
has increased by more than 50%. While the death rate from
heart disease declined from 355 per 100,000 in 1950 to 289 per
100,000 in 1990, the amount of bypass operations jumped from
21,000 in 1971 to 407,000 in 1991, a increase of more than
1,838%. Whitaker states that laypersons are quick to attribute
increases in life expectancy to surgery, but the credit
clearly belongs to greater exercise and healthier diets.
Other examples:
180 patients with osteoarthritis of the
knee were given arthroscopic débridement, arthroscopic lavage,
or placebo surgery (skin incisions and simulated débridement).
In two years of follow-up the surgery group reported no less
pain or impaired joint function than the placebo group. Six
placebo patients liked their fake surgery so much they wanted
it performed on their other knee. For other arthroscopies,
knee surgeon Ronald Grelsamer, M.D., states that at some
hospitals doctors are performing as many as "ten a week
[where] nine are unnecessary."
Jens Ivar Brox, M.D., in a Norwegian study
compared the effects of spinal fusion surgery with
non-surgical therapy for 64 patients with chronic lower-back
pain and disc degeneration. The non-surgical treatment was as
effective as surgery, but at a fraction of the cost with no
complications. With regard to fusions for lower back pain,
Nortin Halder M.D., stated, "If this were a pill and I used
it, I would probably lose my license and go to jail."
Nevertheless, there are about 125,000 fusion surgeries a year
at $30,000 each bringing back surgeons a hefty yearly median
income of $545,000.
Stuart Spechler, M.D., studied 247 patients
with severe acid reflux in the 1980s and found that surgery
was significantly more effective in improving symptoms than
lifestyle changes and drugs. These results reversed in the
1990s after the introduction of proton pump inhibitors
(today's Prevacid, Nexium). About 62% of surgery patients
still needed drugs to control reflux and had no less
incidences of esophageal cancer than non-surgery patients.
Mayo Clinic's Yvonne Romero, M.D., is even more pessimistic,
pointing out that in countries where surgery has been
performed longer than the U.S. (e.g., Brazil), as much as 85%
of surgeries fail after 15 years. Says Spechler, "When you
look at data it is hard not to be biased against surgery."
Nevertheless, about 65,000 Nissen fundoplications are
performed each year at a price of $10,000 each.
Hysterectomy (uterus removal) is the
probably the best example of an often unnecessary surgery.
While a necessity for uterine cancer patients, gynecologist
Michael Broder, M.D., found that in a sample of about 500
women, about 70 shouldn't have received the surgery for any
reason whatsoever and about 350 hysterectomies had been
performed without any diagnostic tests to determine if the
surgery was appropriate in the first place. About 70 women
with benign fibroids had their uteruses removed without first
trying drugs or other treatments that could have been
effective.
A final challenge to the Lexus standard is
the number of accidental deaths occurring in U.S. hospitals
every year. Harvard University's Lucian Leape estimated that
there are approximately 120,000 accidental deaths and
1,000,000 injuries in U.S. hospitals every year. To understand
what staggering figures these are, imagine a Boeing 777-200
with its maximum of 328 passengers crashing every day for an
entire year with no survivors. This would add up to 119,720
deaths, still not as many as are killed through medical error
in hospitals every year. UCLA Professor of Medicine Robert
Brook, M.D., told the Associated Press, "The bottom line is we
have a system that is terribly out of control. It's really a
joke to worry about the occasional plane that goes down when
we have thousands of people who are killed in hospitals every
year."
Certainly not all accidental hospital deaths can be attributed
to institutionalized AMA mischief. Errors by nurses,
pharmacists, and sleep-deprived residents play a role as well.
However, there's also no doubt that AMA-backed restrictions
against greater specialization have helped wreak their havoc
over time as well. A later study by Leape showed that just the
presence of a pharmacist on physician rounds reduced adverse
drug reactions from prescribing errors by 66%. Despite some
shortcomings, the U.S. system still has some of the finest
physicians, surgeons, research, and facilities in the world.
However, the best aspects of the system are due to whatever
vestiges of market freedom still survive, not some illusory
Lexus standard supposedly created by strict statist controls.
The Exceptional World of the Modern
Physician
AMA has built an impressive edifice, one that has completely
insulated physicians from recessionary ("cyclical") and until
recently, technological ("structural") unemployment. While
decade in, decade out, recessions, depressions,
consolidations, and (recently) outsourcing have dislocated
millions of blue-collar, engineering, computer programming,
and middle management employees from jobs and forced permanent
career changes, physicians as a class have been almost
completely immune. Unlike workers in most other industries, a
competent, licensed physician with a clean record who remains
unemployed despite months and months of search for work is
unheard of in the U.S.
Restricting labor supply has markedly boosted incomes. Median
yearly salaries for primary-care physicians are $153,000, for
specialists $275,000. Another more recent survey across many
specialties and 3+ years of experience makes hospitalists
relative paupers of the profession at $172,000 and spine
surgeons at the high end raking in $670,000.
Restricted supply aside, there's certainly nothing wrong with
competent physicians becoming fabulously wealthy at their
craft and nothing about a free market that would ever preclude
such. Indeed one of the worst transgressions of current system
is allowing the most rude, incompetent, and stupid physicians
(e.g., Clinton Surgeon General Jocelyn Elders who wanted
public schools to teach first graders how to masturbate) to
earn incomes relatively close to competent ones.
Of course life is not a complete bowl of cherries for all
physicians. Malpractice insurance premiums for some Ob/Gyns
are now running as high as $160,000 per year. Some Ob/Gyns
have been lucky to have their hospitals pick up the tab.
Others have had to move to different states. No one would
disagree with AMA that paying $160,000 in insurance premiums
is outrageous.
The problem is that AMA's restriction of labor supply has made
the problem worse at the margin than it otherwise would be.
Plus, exactly how does a thoroughly rent-seeking organization
such as AMA lecture malpractice attorneys on the adverse
consequences of wealth redistribution? It can't with any
convincing credibility, thus it has no effective answer to
some in the far Left either, who want to conscript physicians
to provide infinite "free" care to them because they claim
they have a "right" to it.
Robots to the Rescue?
Two recent articles on the Web, show two divergent paths the
U.S. health care system can take. A recent story on MSNBC
reflects the worsening status quo. It was a report on a new
robot ("robo-doc") that roams hospital halls visiting patients
in place of a physician. The robot is controlled from remote
location by a physician. The device is an obvious implicit
attempt to cope with the artificial scarcity of physicians.
Most of the patients, instead of laughing the pathetic robot
out of their wing, thought the idea was jim dandy. Presumably
they couldn't explain how the armless robot would resuscitate
them if their conditions took a sudden turn for the worse.
On the other hand, the great Ron Paul, M.D., has recently
discussed the trend of cash-only practices which reject all
insurance as well as Medicaid and Medicare. He profiles a
Robert Berry, M.D., who charges only $35 for routine visits.
(This is about half to a third of what I'm typically
charged--with insurance at that--and yet my current doctor,
whose income in one year exceeds what I make in five, is
moving to another practice because she wants more money.)
Cash-only practices of course do nothing to address physician
supply, but some relief is better than none, especially when
living in a clueless American public that thinks robo-docs
represent actual progress in medicine.
A happy 100th birthday to the Council on Medical
Education...and for the sake of all our health, hopefully not
too many more.
________________________
Dale Steinreich, Ph.D., is an adjunct scholar of the Mises
Institute, and contributor to AgainstTheCrowd.com.
