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Thursday, October 31st 2013

A Medical Education Bubble

There’s a nice, brief editorial ahead of publication in the New England Journal of Medicine. Everyone needs to consider this when discussing American physician earnings; especially as compared to the rest of the world.

[I]f we aim to reduce the costs of health care, we need to reduce the costs of medical education. We don’t have to believe that the high cost of medical education is what causes increases in health care costs in order to develop this sense of urgency. We just have to recognize that the high costs of medical education are sustainable only if we keep paying doctors a lot of money, and there are strong signs that we can’t or won’t. Only about 20% of health care costs are attributable to physician payments, and many of the current efforts to reduce costs are aimed elsewhere, such as hospital payments, and have only indirect effects on physicians’ earnings. But physicians’ and dentists’ earnings have been sluggish since the early 2000s.3,4 Even if prospects for physicians’ income fall fast, a burst bubble can be averted if schools see it coming before their students do and lower their prices.

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