Tuesday, September 6, 2011

What Happens When “The doctor will see you now” Is Replaced by “Show me the money”?

A fascinating article appeared in Monday’s New York Times, headlined, “Adjusting, More M.D.’s Add M.B.A.”  That is, medical doctors are now getting master’s degrees in business administration.  As the Times explains:

As recently as the late 1990s, there were only five or six joint M.D./M.B.A degree programs at the nation’s universities, said Dr. Maria Y. Chandler, a pediatrician with an M.B.A. who is an associate clinical professor in the medical and business schools at the University of California, Irvine. “Now there are 65,” she said.

Mark V. Pauly, a longtime leader of the health care management program at the Wharton School at the University of Pennsylvania, said, “A light bulb went off and they realize that health care is a business.”

And so doctors are learning business as well.   As Penn’s Mark Pauly says in the Times article, “healthcare is a business.”   That point is worth pausing over: doctors as a business.  Some cynics will say that this is nothing new, that doctors have always been in it for themselves, but as the Times story makes clear, this is indeed a new businesslike trend in the offing.  So how to regard this trend?  What does it mean for doctors--and for the rest of us?  

On the one hand, it’s hard to blame doctors for shifting toward a greater focus on businesslike profit-maximization.  Why?  Because while doctors are admired by the general public, they are not respected by powerful blocs in society.   A 2010 Gallup poll shows that health professionals (nurses, pharmacists, and doctors, but hereafter, for simplicity’s sake, we’ll just “doctors”) finish at or near the top in rankings by the public of most admired professions.  Yet at the same time, doctors are very much disrespected by big financial players in society, including lawyers, insurance companies, and governments.   And so doctors must compare the specific negative power of those antagonistic blocs against the general esteem of the public--and today, the power blocs have an edge over the public.  That is, the real muscle in our society belongs to lawyers bent on suing doctors, also suing medical drug- and device companies.   And other segments of society, including insurance companies and governments at all levels, are seemingly guided by a sole objective: to control and cut costs, no matter what the other consequences might be.   In such an environment, perhaps it makes sense for doctors to muscle-up financially in self-defense.  Okay, so that’s why doctors are getting MBAs.

But on the other hand, what about the rest of us and our health?   What about the public interest? Yes, it’s a free country, but are we as patients better off if doctors take time away from medicine to focus on business?   That is, if doctors become so focused on making money that they take two years to get a formal MBA?   And more importantly: If doctors become doctor-businesspersons, is that really good for our national health?   Might we better off, instead, if we could think of ways to incentivize doctors to put more energy into medicine and the healing arts?  

One thing is sure: If the doctor-business melding trend continues, big things in our society will change.  First of all, it means an inevitable downshift in the public esteem of doctors.   One ultimate source of medical prestige is the feeling that doctors are motivated by at least a modicum of altruism.  It’s at least a little bit of altruism, people think, that inspires doctors to put themselves through the rigors of strenuous education in order to help others live better and longer.  The public realizes, however vaguely, that the Hippocratic Oath, composed some 2500 years ago, is still the guiding medical-ethical document for the profession.  The modern American version, for example, includes these idealistic lines:

I will prevent disease whenever I can, for prevention is preferable to cure.

I will remember that I remain a member of society, with special obligations to all my fellow human beings, those sound of mind and body as well as the infirm.

If I do not violate this oath, may I enjoy life and art, respected while I live and remembered with affection thereafter. May I always act so as to preserve the finest traditions of my calling and may I long experience the joy of healing those who seek my help.

Obviously not all doctors have lived up to these high standards, but just as obviously, most doctors have--that’s why doctors are so respected.  Moreover, the reality that the medical profession, plus medicine, has done great good is undeniable; over the last two centuries in the US, for instance, life expectancy has more than doubled, while the infant mortality rate has plummeted by some 98 percent.

Yet what might happen if doctors just became another species of businessmen?  What happens if the Hippocratic Oath is supplanted by profit-and-loss statements?

One early clue comes from those same Gallup rankings, which showed that the honesty and ethics of doctors are rated “very high/high” by 66 percent of the population, while business executives are so rated by just 15 percent.   So if doctors turn into just another category of businesspeople, it’s logical to assume that their prestige will drift down toward the general level of businesspeople.  

More urgently for most of us, what’s the health impact of purely businesslike doctors?   What happens when you go to such a doctor?   Will he or she want what’s best for you, the patient?  Or what’s best for his/her bottom line?   There’s a big difference.  As noted, the Hippocratic Oath stipulates, “I will prevent disease whenever I can, for prevention is preferable to cure.”   But of course, from a doctor’s point of view, cure, or attempted cure, is a better financial bet than prevention.  From a purely financial utilitarian point of view, separated from any ethical framework, it makes perfect sense not to tell a fair-skinned patient about the danger of too much sun--and then treat the patient, a few years or decades later, for skin cancer. 

Once again, despite the Hippocratic Oath and all the other medical canons, we have seen plenty of profiteering doctors who eagerly order unnecessary and duplicative tests and even superfluous operations.   Still, so far at least, we can say that these are rotten apples in the professional barrel.  Yet what will happen if and when medicine becomes fully “incorporated” and the new goal for doctors becomes hitting revenue targets?   If this were to happen, the most obvious consequence is that the prestige of the medical profession would plummet.

Some doctors, to be sure, might say, “Fine.  Keep your prestige.  We’ll take the money.”  Yet meanwhile, for every doctor who reaps the monetary benefit of an MBA, there are another hundred doctors who have been proletarianized--that is, turned into an overworked and underpaid wage-slaves--by Medicare or the insurance companies.  That is, proletarianized doctors are put to work on the medical equivalent of an assembly line, told what to do by a bureaucracy, told what to prescribe and how fast to do it.  Yet either way--whether doctors learn how to make more money as corporate operators or just accept becoming salaried employees of a public or private bureaucracy--the uniqueness of their profession will be lost.  And that will be a huge loss to the commonweal.   

Once again, those words: “healthcare is a business.”  As a matter of national policy, is this really what we want?   Do we want to eliminate the elevating aura of professionalism and move to total bottom-line-ism? 

We might learn the fate that doctors could face from the precedent of lawyers.  Once upon a time, lawyers were seen as a self-regulating guild, in which private appetites were subordinated to what we would now would call “the public interest.”  In England, mother country of American law, new barristers would be “called to the bar” and then spend their careers as members of an “inn of court,” which were a combination of insider’s club, workplace, and classroom for continuing legal education.   The guiding idea was that senior barristers would oversee the proper development of the legal profession, providing discipline and sanction as needed.  And such supervision was indeed needed, because after all, lawyers have extraordinary power--most obviously, the power to make or break individuals and firms with lawsuits.  And so the masters of the bar prohibited, for example, champerty--over-zealous or manipulative lawyering.  Were these long-ago lawyers motivated by idealism?  Not necessarily; they might have made the practical calculation that if they didn’t police their own profession, others would do it for them.

In the US, bar associations attempted to fulfill the same policing and oversight function.  And so, for example, the American Bar Association forbade lawyers from advertising, beyond the use of business cards. 

Those rules were overturned in the 1970s on free-speech grounds, in keeping with a larger sense that the US economy needed to be deregulated.  Critics of the old system were right to criticize it as cliquish and self-protecting, but they were wrong to think that the new wide-open system would be an improvement.  Today, the legal profession has been entrepreneurialized; one consequence has been the rise of John Edwards-type legal buccaneers--lawyers becoming millionaires and even billionaires.   Are we really better off being a nation of all lawsuits, all the time?   Americans curious as to the cumulative harmful impact of this litigation might take a look at Walter Olson’s website, Overlawyered.com.

Another ill consequence to our healthcome to our health in the form of those ubiquitous television spots, trolling for clients, featuring phone numbers such as 1-800-BAD DRUG.   In other words, legal predators are now free actively to seek plaintiffs to sue medical providers for any and everything.   So now we see what happens when a profession is fully and totally commercialized, even as it maintains its coercive power; now, more than ever, the power to sue is the power to destroy.   In today’s legal environment,  ethical canons and traditions of restraint have melted away in the white heat of publicity- and profit-seeking litigation.   The cost to doctors is bad enough, in terms of malpractice insurance, but the cost to patients has been infinitely greater, in terms of damage done to medical research and development.   As noted at SeriousMedicineStrategy.org in the past, the real story of the past two decades has been the precipitous decline in the number of new drugs and medical devices coming to market, as well as the wipeout of the medical venture-capital sector.   

So over the last few decades, lawyers have been de-regulated and de-professionalized, and the result is that the profession has been enriched, even as its ethical prestige has been degraded.   So now we could go further and ask: What would happen if other professions were similarly de-professionalized and profit-maximized?  What would happen to the police?  Or to the military?  Or to the courts?   To be sure, there are libertarian theorists who think such privatization would be a great idea, but mercifully, not too many Americans agree with them.  

For most of us, it makes sense to see our society as a series of sectors, each with its own sectoral  rules, under the overall umbrella of the Constitution.  Public officials are supposed to operate according to one set of rules.  So are the clergy.  And families, too, have some unique rights.  This is the essence of pluralism, and it is also the essence of common sense.   Edmund Burke called these different groups “little platoons,” while Peter Berger and Richard John Neuhaus called them “mediating structures.”  It’s impossible to imagine society functioning without these legal and traditional privileges.   

Yet at the same time, untrammeled market forces, unmodified by the morality or ethics of non-market entities, are a threat to each of these little platoons and mediating structures.   And that’s why we should worry about what is happening to the medical profession--what doctors are doing to themselves, and what they would, in turn, do to us.  

In recent decades, we can note, advocates of pure market forces have gained ascendancy in business thinking.  One oft-heard argument is that the greatest goal of a corporation should be to maximize “shareholder value,” and therefore all other corporate goals should be subordinated to that prime objective.   And so, for example, the interests of corporate stakeholders, as opposed to shareholders, are given short shrift as a matter of policy and ideology.  Such a view may have its place for a company making widgets, but if the same value-system migrates into a medical office, trouble will ensue.   

It’s not hard, for example, to foretell that corporatized doctors, schooled in the new verities of corporate methods, will see the Hippocratic Oath as less and less of a hindrance to their pursuit of profit thorough any possible avenue.    And so just as “innovative” financing schemes became the bane of the financial markets in recent years, so new-style doctors could find “innovative” ways to extract money  not only out of patients, but also out of society.   Organ sales from willing donors--or unwilling donors?   Any number of Coma-like scenarios?   So then we will get the worst of both worlds: greedy doctors who do a bad job for patients, while costing the individual and the country even more more money. 

Some will say, of course, that there’s no alternative, no turning back.  The forces of modernity--from global competition to the Internet to the rising health consciousness of the citizenry--are shaking up the medical profession.  And so we must go forward, we are told, into the further  transformation of the medical profession.   

It is indeed true that we can’t go home again to the idea of a country doctor.    But we don’t have to give up on the traditional mores of medicine.  We can keep the best of our sacred medical tradition and yet also reap the best of what science has to offer.  How?  We will explore that in the next installment. 


  1. They'll get paid Jim.
    "it means an inevitable downshift in the public esteem of doctors." -NO! Doesn't matter!
    Having altruism doesn't mean they have to be fools.
    Healthcare is a business and a vocation. It's orientated towards the patient.
    The forces of modernity are blending in nicely with the country doctors here on Long Island NY. I know, Cathy & I have two doctors in our family. One's Director of Medicine: an Internist and Pediatrician, the other is OB/GYN. All board certified. And our daughter is a registered nurse.
    Maybe, MSM's view of doctors has diminished and some of the public is brain washed by them. But the people out there know what doctors are going through and are glad they are still working to cure them.

  2. Doctors run small businesses that hire receptionists, billing clerks, filing clerks, janatorial services, IT services, and a host of others. They are saddled with excessive regulation to treat Medicare and Medicaid patients, and must accept rates for their services that do not reflect this regulatory burden much less highly specialized expertise (which costs them years of schooling and several hundred thousands of dollars to obtain). Perhaps when more doctors run their practices like the businesses that they are (and have always been), they will organize into an effective lobbying group to take on trial lawyers, regulators and others who are standing in the way of their practicing the healing arts. Sometimes you have to take a detour to get to where you really want to go.

  3. These rules were repealed in 1970 on free speech grounds, corresponds to a broader sense, the U.S. economy is in need of deregulation. Critics of the old system, the right to criticize it as a closed and self-defense, but they were wrong to think that the new wide-open system will be improved.
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