Monday, November 26, 2012

A few more thoughts on the medical labor market

1. It seems perverse to say that the medical labor market is problematic because Medicaid and even Medicare reimbursement rates are so low. Let's say the Defense Department used it's monopsony power to consistently force prices for weapons systems below what it really costs to make them, leading defense contractors to exit the market. It seems to me that suggesting the defense industry's labor market is out of whack is the wrong response: the right response is to fix the payment system (something a lot of people want to do with Medicaid and Medicare).

2. I am reading mixed things on whether Medicare funding of residencies or the residency review boards themselves are clogging up medical labor markets - particularly specialties. The latter makes a little more sense to me. Medicine is a lucrative field. If the governments' entitlement program can't bring itself to fund all the positions that need to be funded, I can't imagine the funding can't come from elsewhere. My brother is engaged in a PhD program in theology due to the generosity of University of Chicago undergrads. Surely schools benefit enough from their hospitals relative to the benefit that the University of Chicago receives from its theologians that most could manage the same for medical students if they had to. My guess is the blockage is elsewhere, although there could certainly be problems with institutional evolution on this front.

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