Primary Care And Payment For Office Visits

Megan McArcle appears to have paged me, asking  Is There a Doctor In the House? She writes:

A lot of liberal blogs, and a few conservative ones, are discussing this article from the New York Times, which points out that if you look at actual economic resources, instead of prices, increasing health care utilitization isn’t going to be so easy, because there’s not a lot of spare capacity in the system…

It’s more reasonable to note that reimbursement structures are creating an undersupply of primary care physicians, compared to the number of specialists.  We reimburse for procedures, not wellness, so surgeons are well paid and GPs aren’t.  This has led to the bizarre fact that Medicare chronically underreimburses (and thus insures an undersupply of) geriatricians, which should be the one doctor a program like Medicare produces a lot of.

As she also notes, this is nothing new. There have been recommendations for years to increase reimbursement for primary care as opposed to subspeciality care. Medicare has made small moves in that direction, but typically the specialists put up enough of a fight to preserve higher pay for their procedures.

While Megan appears to understand the problems and is right about some of the responses, she makes one mistake in concluding:

Pay for office visits, and you will get a lot of unnecessary office visits.

The point is that we don’t have enough primary care people to handle all the office visits which would be needed if we expand health care coverage. If the capacity of primary care physicians to conduct office calls is already exceeded at current payment levels, paying more is not going to necessarily lead to unnecessary office visits. There is little need to preform unnecessary office visits when there is a demand for more necessary office visits than can be filled.

What increasing pay for office visits will do is to get more physicians to be willing to make their income from primary care office visits as opposed to from procedures.

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