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From MD to MBA: The Business of Primary Care


You could argue that medicine was never meant to become a for-profit business the way selling cars, cosmetics, and fast food are businesses. And yet, in the United States, health care has become a for-profit business. The story of how this happened is complex, but decisive elements include the advent of Medicaid and Medicare in 1966 and the widespread availability of employer-sponsored health insurance.

Editor's note: This post was picked up from www.thehealthculture.com.

You could argue that medicine was never meant to become a for-profit business the way selling cars, cosmetics, and fast food are businesses. Among the differences between being a patient and being a consumer of non-medical goods and services:

•There's an asymmetry in the knowledge available to patients and doctors – a patient can't possibly be as informed as a doctor about what’s wrong and what’s needed.
•Patients can't predict when they'll need medical care and often seek care when their health is threatened and when decisions must be made quickly. 
•It's the supplier – the doctor – who determines what the patient needs. 
•There's an ethic that assumes doctors will not sacrifice the medical needs of a patient to make a profit. 
•There's a very steep entry cost to becoming a doctor. 
•The health care market is basically not price competitive – a patient contemplating brain surgery is not going to be tempted by a surgeon offering a deep discount. 
•What's at stake in health care – the consequences of making a mistake – is death and disability, not simply a case of buyer's remorse.

And yet, in the United States, health care has become a for-profit business. The story of how this happened is complex, but decisive elements include the advent of Medicaid and Medicare in 1966 and the widespread availability of employer-sponsored health insurance, which got a boost during the wage freeze of World War II. Once patients no longer needed to know the true cost of health care, business interests were free to create what Dr Arnold Relman called the "medical-industrial complex."

Regardless of how and why it happened, we now accept that medicine in the US is a profit-generating business, where many segments of the "industry" aim to reward investors, not patients. As a result, health care has become too expensive for many patients, for employers, and for the government. Everyone agrees that costs are out of control, but – with so many competing economic interests - the solution is extremely elusive.

Doctors Caught in the Middle
In one of many essays published during the debate on health care reform, Atul Gawande argued that we must protect patients by building on the health care system we currently have.

Yes, American health care is an appallingly patched-together ship, with rotting timbers, water leaking in, mercenaries on board, and fifteen per cent of the passengers thrown over the rails just to keep it afloat. But hundreds of millions of people depend on it. … There is no dry-docking health care for a few months, or even for an afternoon, while we rebuild it.

But just as patients need continuity of care, so do doctors need continuity of acceptable working conditions. Primary care physicians today are caught between two different models of practice: One emphasizes the traditional ideals of medicine. The other urges doctors to focus on business practices that will maximize their profits.

There are vocal advocates of both models.

Medicine as a Business
On the one hand, doctors are encouraged to be smart business entrepreneurs. Medical journals discuss adding courses to the medical school curriculum on how to run a business. The Internet is replete with business coaches – some of them former doctors – who will offer advice and on-going support designed to increase profits.

On Amazon one can purchase The Business of Medical Practice: Advanced Profit Maximization Techniques for Savvy Doctors. On medical blogs, doctors share their advice on things such as how to sell pharmaceuticals directly to patients.

Harvard, UCLA, and many other less reputable institutions offer acupuncture training for physicians. After such a course, a doctor can insert a few needles into a patient, leave her to rest under a heat lamp, and go off to see other patients. Cash only. No insurance involved.

The message underlying these offerings is that medicine is a dog-eat-dog business, and you'd better get used to it because only the strong survive.

Medicine as a Calling
On the other hand, there's a point of view that resists the basic assumption that medicine must be a business like any other business. The concluding chapter of Dr Relman’s book, A Second Opinion: Rescuing America’s Health Care, is titled "An open letter to my colleagues in the medical profession." He writes:

I suspect most of you chose medicine for the same reasons my generation did over sixty years ago, and the prospect of a good financial return on your educational investment was not at the top of your list. Financial reward was important, of course, but it was not your first priority. Everyone knows that a competent physician can almost always earn a good living, but there are many easier ways to make more money, without working so hard or preparing so long and arduously. You wanted a respected career that gave you independence, and the satisfaction of being a needed, important member of society. You wanted to use modern biological science to help the sick and injured, and to enjoy the esteem of patients and colleagues that would come from doing your job well. You liked the prospect of being primarily accountable to your own conscience, your patients, and the standards of your professional peers.

Earlier in the book Dr Relman writes: "[T]here must be something fundamentally wrong with a system that has turned health care into an immensely profitable business, and an investor's playground, while allowing costs to skyrocket, coverage to shrink, and quality to decline." And he quotes David Mechanic: "At some point we as a nation will have to decide whether we wish to design our health care system primarily to satisfy those who profit from it or to protect the health and welfare of all Americans."

The In Between Generation of Doctors
The solution to the health care crisis that Dr Relman proposes is a single-payer system. Doctors will belong to multi-specialty group practices administered by medical professionals. They will earn a salary, not pay-for-performance reimbursement. A doctor could elect to see patients outside the system, but could not practice both inside and outside the system. Dr Relman makes a strong case, appealing to the ideals that inspired doctors to enter the medical profession in the first place.

But meanwhile – as the US is trying to sort all this out – there's a whole generation of primary care physicians who can't wait. The current system is not working for them, either financially or professionally. They have loans coming due, mortgages to pay, and children who will want to attend college. They can no longer practice medicine the way it was portrayed in episodes of Marcus Welby, MD. And while there may be a solution in the future, what are they to do in the meantime?

Getting the Word out
I read the news about health care and medicine every day. There’s a great deal of it. And yet I don't hear enough in the mainstream media about the predicament that this in between generation of doctors faces. The discontent of primary care physicians has not sufficiently registered with the public.

The public may not readily appreciate the adverse financial consequences of a health care system in which the majority of doctors become specialists. But it would understand the story of a primary care physician who chose to end her practice because she was undervalued, overworked, frustrated, and underpaid.

Patients don't want their doctors to be unhappy. It's not in anyone’s interest. If more doctors went public with their stories – simply by offering an interview to their local paper, eg – they could be part of a force that accelerates the changes in health care delivery our country needs.

Perhaps this can only happen once it's too late for an individual doctor, as in the forthcoming book Out of Practice. A practicing doctor can't expect to attract patients by revealing that she’s close to going out of business. But I continue to hope that somehow – in a way that’s not yet perfectly clear - more public awareness of this issue will prevent the addition of MBA skills to curricula that are supposed to be training MDs.

Related posts:
Why are there so many cosmetic surgeons?Out of Practice: The demise of the primary care practitionerAre doctors tired of practicing medicine?Marcus Welby vs. the specialistsShould doctors work weekends?Physician as lone practitionerDoctors in the trenches speak out – Part One


Image: Great Medical Practices

Atul Gawande, Getting there from here: How should Obama reform health care, The New Yorker, January 26, 2009

Arnold S. Relman, A Second Opinion: Rescuing America’s Health Care

Frederick M. Barken, Out of Practice: Fighting for Primary Care Medicine in America


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