Want to read an understandable explanation of the current economic crisis, but afraid you’ll be blown away by obscure economic phraseology and opaque financial concepts? The Disease Management Care Blog recommends the highly readable and crisply written The Return of Depression Economics by Nobel Laureate and blogger Paul Krugman. Like that highly intelligent college professor who has a knack for explaining things at your level with the occasional dash of sparkle and cynicism, Dr. Krugman brings money supply, central bank interest rates and capital control concepts within the intellectual reach of us non-economist amateurs. He makes it refreshingly simple.Thanks to Dr. Krugman, the DMCB learned that one of the more damning features of the crisis was the phenomenon of accelerating and self-reinforcing negative feedback loops. Thanks to a peculiar mix of human psychology and highly interconnected leveraging, things logarithmically went from slightly bad to horribly awful in a short period of time.
So what does this have to do with healthcare? The Disease Management Care Blog believes the same accelerating negative feedback loop could occur if the future version of ObamaCare mistreats the primary care physicians.
Let’s assume there are ten primary care doctors in a mid-American county, each of whom has a panel of around 2000 patients. Some patients leave, some patients die, so let’s optimistically assume at any time there is room for 100 new patients in each doc’s practice. Along comes ObamaCare, a government sponsored insurance plan for persons unable to afford private insurance. 1000 county residents that were uninsured now have insurance and seek out a medical doctor. The 1000 persons are distributed among the 10 doctors, resulting in 100 new patients per doctor. All is well, right?
But suppose ObamaCare is perceived by the physicians as having onerous terms: an unattractive fee schedule, an unwelcome return to capitation or high administrative burdens that prompt one physician to close the practice to any new patients. As a result, the newly insured 1000 persons are distributed among 9 remaining physicians. That’s 111 or 11% over the threshold of 100 more patients per doc. That’s tolerable, maybe. But another wavering physician may may see the threat of even more patients seeking access to the practice as a reason to also close it to new patients. Now two physicians have dropped out, resulting in 1000 new persons among 8 physicians. For each doc, that means 125 new persons or 25% more. That may be close to intolerable. That may cause a third physician to bail out. The remainder are left with 142 or 42% over the threshold of 100. If four drop out, that’s a 66% increase. Every time one more physician heads for the exits, the remainder are left with disproportionately more patients to deal with. Faced with a healthcare access version of a run on the bank, all ten will quickly slam their doors.
The point is that a linear decrease in the number of available physicians who accept ObamaCare mathematically results in a non linear greater number of patients pursuing the remaining new slots among the remaining primary care physicians. That’s the accelerating negative feedback loop akin to the one that brought the credit markets to their knees. As the remaining physicians see their practices overwhelmed by higher number of patients with unwelcome insurance terms, more physicians will quickly drop out because they won’t want to be the last practice facing 1000 new patients. That’s the same psychology that also battered the markets. Without any economic incentive to accommodate the new patients, the negative feedback loop will rapidly cause the local primary care access market to collapse.
The DMCB recognizes this is a very simplistic unidimensional portrayal of a very complex system that varies considerably across the U.S.. What's more, it thinks most physicians will continue to struggle to do the right thing and see patients.
That being said, simple isn't necessarily wrong.
No comments:
Post a Comment