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NY Times: “Too Few Doctors in Many U.S. Communities.” Blame policies favoring 3rd-party payment

The New York Times reports:

In the Inland Empire, an economically depressed region in Southern California, President Obama’s health care law is expected to extend insurance coverage to more than 300,000 people by 2014. But coverage will not necessarily translate into care: Local health experts doubt there will be enough doctors to meet the area’s needs. There are not enough now. …

The proportion of medical students choosing to enter primary care has declined in the past 15 years, as average earnings for primary care doctors and specialists, like orthopedic surgeons and radiologists, have diverged. A study by the Medical Group Management Association found that in 2010, primary care doctors made about $200,000 a year. Specialists often made twice as much.

The Obama administration has sought to ease the shortage. The health care law increases Medicaid’s primary care payment rates in 2013 and 2014. It also includes money to train new primary care doctors, reward them for working in underserved communities and strengthen community health centers.

Read more: Too Few Doctors in Many U.S. Communities – NYTimes.com.

But why is there a shortage of primary care physicians?   Richard Posner has an answer:

But we are stuck with third-party payment, and it systematically favors specialists over primary-care physicians, because specialists tend to provide discrete procedures, which are easier for the insurers, whether they are private insurance companies or government, to cost. The care provided by primary-care physicians has, to an extent, an elastic and discretionary quality.

Medical licensing also limits the number of practicing physicians.