Tackling the physician shortage: Reduce inefficiency, add residency slots

Physicians are aging out of the industry and contributing to a doctor shortage that is only made worse by the similar aging in society as a whole.

Unfortunately, it might get worse before it improves, says Janis Orlowski, MD, chief healthcare officer for the Association of American Medical Colleges.

Orlowski's research suggests there will be a shortage of 45,000 to 105,000 physicians within the next several years. Working with Tim Dall, managing director for IHS Life Sciences Consulting, Orlowski based that number on a few different factors including census data and behavioral information on how patients see their physicians and how often. It is also factored into scenario planning, such as the effects if the Affordable Care Act's Medicaid expansion was incorporated in all 50 states. The wide range in the estimate is based on six to eight different scenarios depicting how healthcare could evolve in the future.

"Age is the driving factor behind it," said Orlowski. "The Baby Boom generation is actually entering retirement, so it's a theme that's been going on."

But it is not the only factor. The declining number of medical residency slots available to new graduates is perhaps an underexamined aspect of the shortage and one that could be addressed through policy. According to Orlowski, the number of students attending U.S. medical schools has actually climbed about 28 percent in recent years, a positive trend indicating more young people want to become physicians. Class sizes are getting larger, and Orlowski's projection in the number of medical students will have grown by a full third over the next couple of years. It's encouraging news, from both a physician and patient perspective.

The problem is aspiring physicians need residency slots to complete their training, and there are only so many available.

"Residency is where we see a problem," said Orlowski. "The training you do in a healthcare setting after medical school, which is required to be board certified -- that's supported by Medicare, and in some states by Medicaid and state funds. And there's been a freeze on the number of slots for 20 years."

It was the Balanced Budget Act of 1997 that caused the problem. The legislation came with a promise that the number of residency slots would be unfrozen in a year or two. Yet, a couple of decades have passed with no changes. The number of overall slots actually has increased slightly, but they've mainly been subspecialty slots paid for by the hospitals themselves.

"What we want is more residency slots in that base residency training," said Orlowski. "What we've actually seen is growth that the hospitals are paying for, in the subspecialty slots, because they're looking at where they want enhancement. Not exclusively, but that's the trend."

Those dynamics could change within the next couple of years, she said. While the number of domestic medical students has been on the rise, the number of international students has declined. If the trend continues, there will soon be fewer residency slots needed. There likely still won't be enough, but it may ease the bottleneck.

However, the aging physician workforce will see a rash of doctor retirements along with the aging general population will likely drive an increase in healthcare utilization.

Graham Gardner, MD, co-founder of Boston-based health IT company Kyruus, believes this dilemma can be addressed in part through an increase in physician efficiency.

"As I think of physicians as part of a big health network, and you think about 2,000 or 10,000 doctors across the network, somewhere around 40 percent of the appointments are empty every day," said Gardner. "Even though a doctor may be booked out for weeks when you look at a new doctor especially, there's enormous unused capacity."

Adding to that lack of efficiency is the number of misdirected referrals, which Gardner said may comprise about 10 percent of a doctor's overall capacity. Some see patients who were referred to them incorrectly -- they're a hand surgeon, whereas the patient has a foot problem. Others might be able to help, but may not be operating at the top of their license, tending to an ailment that could have been handled adequately by a nurse practitioner.

"You might be looking at 50 percent of a doctor's time being used incredibly inefficiently," said Gardner. "It really raises the urgency of a doctor being utilized at the top of their license. If urologists are aging out of their practice, we have to think about what younger ones are doing. Maybe a nurse practitioner can take some of that stuff."

There are a number of ways a health system can streamline this efficiency, and they all involve making better use of data -- typically through a technology solution. No matter the method used, the effect can make better use of physicians' time to save systems a bundle.

"Over the year, you're likely generating thousands from downstream revenue from radiology, etc.," said Gardner. "Another way to think about it is if you have ... a billion-dollar healthcare system that's only operating at 70 percent utilization and you can pick that up by 5 percent, you're talking about millions of dollars."

Orlowski and the AAMC are also working with physicians to improve their work-life balance, with the goal of keeping them in the workforce longer, even if age forces them to cut back on hours or certain clinical services. The group is also working to increase the number of residency slots and currently examining the efficacy of interprofessional teams in which residents, nurses, pharmacists, dietitians and social workers all work together in more of a collaborative care model.

Overcoming the physician shortage will require that kind of multi-pronged approach.

"More and more organizations are realizing this is a problem, and they have to address the supply-and-demand mismatch," said Gardner. "It's also a patient experience issue -- this has become front and center. This is not just one person's problem."

Twitter: @JELagasse