The New Republic has been writing about how low reimbursement rates for doctors are resulting in lower quality and quantity of care for Medicaid patients. Yesterday, Harold Pollack highlighted a study of the subject in Pediatric, which focuses on the tradeoffs that doctors face when deciding to take on another patient: do they want more customers or more leisure time?
The study notes that Medicaid programs have banked on the fact that, unlike doctors’ fixed costs, the marginal cost of taking on another patient is low, and therefore doctors shouldn’t mind adding a Medicaid patient for minimal payment. However, this calculation failed to consider that young doctors-particularly female doctors-value leisure time, which often really isn’t “leisure” time, but time with their own children.
…what gets interesting is Flint’s effort to put dollars-and-cents numbers behind the argument. He notes that 38% of pediatric residents sought (and 21% accepted) a part-time position as a first job. This proportion surprised me. At least partly, it reflects the striking gender mix across the medical profession. Almost 70 percent of pediatric residents are women. Many pediatricians are working mothers, whose job schedules must accommodate work-family balance concerns.
Anyway, Flint calculated that such part-time positions would shorten doctors’ annual work output by 2,094 visits, while reducing income by about $34,000. Doing the long division, Flint finds that pediatricians willing to work part-time vote with their feet to forgo about $18.50 per visit.
It turns out that doctors often aren’t reimbursed even $18.50 for seeing a Medicaid patient, so, unsurprisingly, many doctors are closing their doors to these patients.
The ramifications for our new health care system is obvious: As the government tries to control health care costs, they are going to further squeeze down reimbursement rates. At some point, more and more doctors are going to close up shop, leaving us with waiting lines and worse quality of care.
Yet this study is also interesting in that it provides more evidence on how women behave differently when it comes to work arrangement than men do. Pollack professes surprise that so many residents sought part time work. Personally, I’m not surprised. Many women pursue pediatrics specifically so they can create flexible work arrangements, and analysts have noted that medicine is actually a fairly family-friendly industry.
The study suggests that those working part-time forgo $18.50 a visit. It looks like this calculation doesn’t take into account that the doctor probably loses close to half of that in taxes, and then if she has children, she faces childcare costs, which means she would be lucky to clear a few bucks for the extra visit. No wonder they often decide to forget it and spend time with their kids.
Such calculations obviously vary based on life circumstances. A doctor who is single, without any hobbies or other interests, has less pulling him from the office than another doctor who is also a mother paying ten bucks an hour and worrying that she might miss her one-year-old’s first steps. And of course, these different calculations and the different decisions that men and women ultimately explain much of why men, on average, out earn women.