« Freakonomics Radio

309. Nurses to the Rescue!

2017-11-15 | 🔗
They are the most-trusted profession in America (and with good reason). They are critical to patient outcomes (especially in primary care). Could the growing army of nurse practitioners be an answer to the doctor shortage? The data say yes but —  big surprise — doctors' associations say no.
This is an unofficial transcript meant for reference. Accuracy is not guaranteed.
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I'm told us anybody, maybe something like I know it's not something in the arts most trusted profession in America today. Not politicians certainly not position right. It's not politicians. In fact there, the least trusted most trusted passion clients. At this morning we had breakfast at the hotel. The lady was sure to breakfast. You look very very sweet, guys. I will say that lady! No, it's not that lady. Maybe a coach thinking, so many jobs construction worker islands, barbers librarians.
I would have to say teacher teacher, pretty good guess, but not the answer. We're looking for maybe a doctor you're getting warmer most trusted profession. I would say no says I would say- nurses, correct nurses. For fifteen years straight nurses have topped the Gallup Poll list of professions. The Americans say our most honest and ethical. Last year, nurses got an eighty four percent approval rating, the next closest pharmacists with sixty seven percent and then doctor, with sixty five followed by engineers, police officers and so on all the way down to journalists at twenty three percent lawyers at eighteen percent and yes, members of Congress at eight percent, so why our nurses, ranked so high for one thing, is a good chance that you ve directly interacted with one
and more than three and a half million nurses in the. U S is far and away the most popular medical profession and when the most popular occupations overall, so when it be nice to be able to measure the effect that nurses have on patient outcomes today on for economics, radio Give it a shot, so one key advantage of this study is dead. We can compare the effects of nurse on patient health will hear about a huge bloom in one subset of nursing, I'm really excited to be a nurse practitioner, because I want to make the healthcare system less broken. Who hear about imagine movement that re imagining the role of nurses. The evidence seems to be that increasing accessibility care in this way is actually getting better outcomes, but how this movement is running into political and regulatory system. It's hard to change, assist almost insane
like putting the method in charge of them, they are police department. That's next right after this, I'm happy from w- and why see studios this is freakin mix, radio, the podcast that explores the hidden side of everything. Here's your house, Stephen Governor, one reason There are so many nurses in the world is that nurses perform so many functions. They have direct patient contact, they provide medication reminded of the patients provide counselling, and yet, despite
their prominent role, prominent role its near their effect on patient health is not fully understood, and so that's where our paper comes. It. That's the economists, Benjamin Friedrich, yes M, an assistant professor at the collects good of management at North western University. The paper Friedrich mentioned is called the returns to nursing evidence from a parental leave programme. His co author is Martin Hackmen. Yes, all I'm an system, professor economics, it usually Hackmen And Frederick make clever use of what might be called an accidental experiment, so we're in Denmark in the mid nineties and basically the economy is not doing so well, used to be high unemployment, and did you at the time was to bring in some puppy program, step with rotate to workforce and give opportunities for people that are currently unemployed and what the government decides to do is expand. Their existing parental leave program
and offer up to one year of additional leave of absence to every parent, with a child, h, aid or younger one year of extra paid leave. That is so. Parents will receive typically seventy percent of the previous income and with job security too, turned to the previous position. So Denmark was offering a rather generous parental leave programme, including a guaranteed return dear old job, so any parent could take advantage. Yes, the point is this: reform was not targeted the health sector, it all right, statistically, though its heavily women took advantage of its. So it hits healthcare providers completely by surprise and that's one reason why we see these large effects in the nurse occupation, because ninety Seven per cent of nurses are female and debts. One main reason why debt occupation was particularly affected by the programme, so the new danish Parental leave programme appealed especially to women and the nursing sector is almost exclusively female, which meant a lot of nurses took leave but then
and here is the really important part, but then there were no unemployed licence nor sticker replaced them. That's right, even though this leave programme was designed to ease unemployment. It turns out the warrant that many unemployed nurses certainly not enough to replace all the ones who took leave and that overall it on average, a reduction in Europe's employment of about twelve percent so and unintended consequence of this parental leave programme was, at the nursing workforce, suddenly shrank by twelve percent. The doktor workforce, meanwhile, being mostly male, barely shrank at all. The sudden shortage of nursing care turn out to be exactly the kind of shock to the system that a researcher can exploit to measure cause and effect, in this case, Hackmen and Frederick one to see how the nursing shortage affected health outcomes. They had something else going for them. Denmark, like the rest of Scandinavia, is a bit obsessive about record keeping and collect
all sorts of personal data and just about every citizen, so that means we can observe every individual and whether they take advantage of this leave programme today gives us information on dear employment, and then we have very rich health data and we can analyze information about patients in hospitals and nursing homes, so well, no possible emissions will know, diagnosis and treatment received detailed diagnosis called sword that allows us to zoom in into different hospital sub populations. We can compare heart attack. Patients will look at people that have pneumonia bones at risk and will know from the death register, for example, the mortality rates of different patient groups, and so we can very specifically say which patients were most affected. By the reduction in nurse employment at these different providers. Ok, so that's a lot data on nurses, patients, nursing homes and hospitals what they find but start with hospitals. We do find a negative effects in hospitals.
Yes, so the way we measured it was to look at the thirty day. it mission raids. Readmission rate is asleep: The measure of hospital care, the idea being that if you have to go back to the hospital after your discharged, the original diagnose doesn't care weren't so great, and this measure the Aramis bound the nursing shortage led to a twenty one percent increase in readmission for adults and children and a forty five percent increase for newborns. So nurses would seem to be quite important to overall health outcomes, but if you think that effect is large consider the data from nursing homes were, nurses play an even more prominent role than in hospitals. We he did. This reduction and nurses leads to us, fourteen percent increase in mortality among people aged eighty five, an older. Yes, sir, what we find is that, in particular, circulatory and respiratory deaths in nursing homes significantly increase just to put his roughly interpol
active right saw, the parental leave programme reduce the number of nurses by twelve hundred in nursing homes, persistently indebted. raised a number of mortality is by about seventeen hundred per year when you consider this the five year olds in older or- nine hundred people. If you look at the people aged eighty five, an older, so these effects are where we think quite large quite large, indeed, which suggests that the returns to nursing are quite high. So if nothing else, this evidence would seem to justify by the fact that nurses consistently win the most trusted profession competition. But what else do we make of this? Finding? Imagine you're a policymaker. You think you'd look at this finding and say: well, since nurses are plentiful and effective and relatively much cheaper,
Doctors. Perhaps we should think about reassessing and may be expanding the role that nurses play in our health care system. Ok, let's do think about that, for this part of the story will bring and for economics. Radio producer Gregg was asking the storing them Tell goes to the heart of the american healthcare system, this very expensive, inefficient model it's a story about how political pressures can we d distorted economics? So you should not be surprised that your health spending is doubled, what it is in other countries and yeah. It's a story about nurses, but before I start I should tell you something about myself in nursing, my mom's nurse hi mom. My answer nurse my sister's mother, in law's a nurse as if all that weren't enough to make me pronurse, then there's my younger sister. So my name is Alexandra Hopson, I'm your sister, I'm a registered nurse, that's about to graduate from nurse practitioner school, and I am excite
about the graduation coming up soon. Alex's, giving your nurse were too sure doctorate from the University of San Francisco, where she also got her bachelors degree in nursing. So I've been a nurse now for six years and I've been mainly focused in primary care because it's an area that I am passion about primary care, including things like annual check, ups and vaccinations is usually are first line of defence against chronic health problems, public health experts, AIDS, incredibly important and the medical literature points with strong relationship between access to primary care and good health outcomes studies. so show that in many cases it can save money since good primary care means catching entreating ailments before they become chronic and costly measures.
Drew passionate about primary care during nursing school has. After doing my irritations in the hospital, I saw a lot of complications and advance chronic diseases that I know it could be prevented if provided the right preventative services without I married her services patients usually way until they have complex illnesses and they end up in the emergency room. Despite the importance of primarily America suffers from a shortage of doctors who actually provide it of the roughly six hundred thousand practicing physicians in the? U S. Only about a third of them work in primary care. The shortage is getting worse as baby boomers doctors retire and since You were than a quarter of newly minted doctors go into primary care by twenty thirty. The association of Medical colleges predicts a potential shortage of more than forty thousand primary care doctors. I think we under pay primary care for
positions and that's one reason: young people don't go into it. That's over Reinhardt at each health, economic, regular economics and finance at Princeton Reynard says: medical students Braun to hire paying specialities like plastic surgery in cardiology, at the expense of pediatrics, general practice and other primary care concentrations. Every specialists earns about forty six percent more than the average primary care physician, but financial ones, those aren't, the only driver. It's an issue of prestige. The culture of the medical school is such that students sort of automatically look up to the specialists and that some are primary care is kinda. Viewed as a step child. The primary care gap is increasingly being filled by nurses. Like my sister, she worked in a clinic serving
area veterans all working nearly full time. She went on to get their masters and public health and now her doktor. Yet I'm a doctor nurse and proud of it. The nurse practitioner degree, which can be a doctor or a masters, requires a lot of training and exams leads a sort of a hybrid position that combines a patient centre focus of nursing, with skills historically reserve for doctors like physicians, nurse practitioners or Mps, make diagnoses, proscribed medications, order tests and x rays and refer patients to specialists. One key difference is the focus and rigour of their training,
and these are required to do hundreds of hours, a supervised clinical working, like my sister. They often spend years in the workforce as a register nurse before getting their NP degree, but they are required to do a residency which, for doctors, is a minimum of three years, typically in a hospital. What's in the workforce, the responsibilities very, for example, in fields involving complex surgeries and peace, assist, physician, but when it comes to primary care, Mps are increasingly taking a leading role. There are not enough providers to take care of all the patients in the country. Today. That's Rony, hair, Kwan, former president of the California Association of this practitioners and an MP herself, and everyone is scrambling to figure out how to fix that problem between aging baby boomers and the affordable. Correct, there's been a huge spike in demand for healthcare services, especially primary care.
But the supply of healthcare is in keeping up. It was a similar imbalance in the mid nineties, sixties. Allegedly, creation of the nurse practitioner profession. The federal government just created Medicare Medicaid, which provides healthcare coverage to the elderly and the poor the sudden massive demand for services was not met with a commensurate explosion in supply. Prices. Skyrocketed and people found it difficult to get care so nurse practitioners first became a role in nineteen sixty five, the first and programme was created at the University of Colorado by a pediatric nurse named the Red afford a pediatric to name Terry Silver. The rigid idea was that Mps would provide healthcare to kids from low income families, but the rule soon expanded. The use of nurse practitioners has spread like wildfire at it literally every aspect of healthcare, you name it honours practitioner, probably works in that fight,
old over the past decade, the number of Mps in the? U S has more than doubled to over two hundred thousand Mps are now graduating each year than empties. In the spring of twenty seventeen, my little sister was begun one of those NP graduates and I flew home to California. watch. The ceremony you're getting really proud of wholesome and a lot of my sister's classmates and ass the morning are becoming an peace, an errand when,
a few BT nurse, and I'm really had to be a nurse artesian or because it is a really underserved population that really need more primary care focus on helping that name christian decline coming from Billy City, California, why I'm excited to be a nurse practitioner, I'm just ready to change the lives of my patience. My name is Kelly Booth. I am from Phoenix areas owner regionally and I'm really excited to be in respect to share, because I want to make the healthcare system less broken, but, as the perversion grows, it's freezing legal and political challenges from state governments. in most states and peace, have had to fight to obtain a licence that would give them what's known as full practice authority, letting them provide all the services they ve been trained and certified to deliver. In California, for instance, they ve been on the losing end of this fight, Serafine, hair corn. Again we ve now had three full practice authority bells that have all failed. So what
problem to figure it out. I decided to drive up to the state capital in Sacramento, after passing, through metal detectors and security it's the office of Senator at her Neda gone her knee in Israel. since the same Gabriel Valley, just EAST, of LOS Angeles, so by profession, optometrist been one for thirty years, been involved in politics. Pretty much. My whole life became an activist was concerned about health care state, how individuals in have access decided to run in six got kind elected in the Senate and ensure they helped committee and have been honoured to be a public servant. One of the first big things her name is did after getting elected, was the former Select committee to analyze the medical workforce of the state we found out to sea
food shortage of primary care providers, but not only was there a workforce shortage, but there was a huge distribution problem of where the primary care providers go to where they didn't go to was California's rural areas. A trend that holds true many other states as well National Rural Health Association says that a quarter of the? U S population lives in rural regions, but only ten percent of physicians actually practice there. a similar shortage and low income urban communities. In both cases, doctors are reluctant to accept the low reimbursement rates of government funded health programmes, her name is wont to do something about these primary care shortages. One option would be to get more doctors into the system, but it turns out that's really difficult. For one thing, Hernandez says there is limited capacity. A! U s med schools of the fifty three thousand students who apply for admission and twenty sixteen thirty two thousand were rejected from all the schools. They applied too
that's sixty percent of all applicants. So we have a finite number of medical schools, whether it's in California or across the country and are not growing in leaps and bounds. The biggest hurdle is obviously the car. There is also the time and money and takes it become a doctor for years. undergrad four years of Med school and then a residency a three to seven more years, there's at least twelve years before the round the workforce and even bigger You is the limited number of residency slots since nineteen sixty five, the federal government has provided most of the funding for residencies through the Medicare programme. but the number of Medicare funded residencies was kept by Congress in nineteen. Any seven and other sources of funding have been slow to make up the difference. There's an angle, debate about the residency system. One side argues we should remove the funding cap and increase the number of subsidized residencies. Another side would like to see more funding
until reforms they believe a redesign system could work without the fifteen billion dollars Washington spends on residencies every year. It's a big, complicated subject, don't take you down the robber who, right now the important part is both sides agree. The current policy the key issue behind the shortage of doctors and why, each year, thousands of med school girls, can't find a residency between the residency bottleneck and the med school bottleneck and the very high cost of tools, You can see why so few new doctors are heading into the relatively low paying field of primary care, so her and India's had an idea. What, if, instead of trying to because those bottlenecks that constrict the supply of doctors, he can encourage a different supply of primary care providers.
Where's practitioners thorough not only less expensive, to train their more cost effective because there is less overhead for them. They have a lower student debt and therefore their willing, possibly even take a lower reimbursement. They truly could could fill in the gap when it comes to pray. I care, but, as we heard earlier, California law does not give and peaceful practice authority. Instead, they have to work under the supervision of physicians, who are each limited to overseeing. Only four and peace and that supervision can cost a lot of money. Hernandez, believes this request severely limits. The impact and peace can have in closing the primary care gap, so he began to fight for a bill to free and peas from these constraints. So what they can do under this bill is it exactly what they are allowed to do under the law right now, the only differences they can do it independently without physician supervision.
The main argument against allowing Mps to practice independently is that they have less training them physicians, but there's a mountain of empirical evidence. From randomized trials, case studies, systematic reviews and analyses of malpractice claims, and it's where similar legislation is already passed, that all points to the same thing when it comes to primary care? Mps are just as safe and effective as doctors, over Reinhard again. I am not aware of any literature that sad care given by nice practitioners. inferior quality are causes safety issues and so on and so forth. Some studies also find patients prefer and peace to doctors, perhaps because they report Mps on average speed, more time with patients, so their training is less expensive.
Yet similar or better outcomes, and by the way they typically make about half as much as primary care physicians. All this makes Mps good candidates to provide primary care to underserved poppy patients. So you can see why health economists, like Reinhardt, support, giving and peaceful practice authority well first about. I think it would healthcare, more accessible to patients because for many things, you don't really need an m d write, but your needs Buddy, who knows how to stage a will Who knows some? is going around like the flu and they would know initially what you should do and secondly, it would make a cheaper and more efficient, it's an idea that has support from a wide range of organisations.
Putting the National Governors Association, the Federal Trade Commission and a r p business is business groups? Are there was a large coalition? Her name is a Democrat, also support from Republicans like Senator Jeff Stone, who represents portions of riverside Count I applaud centre to Hernandez efforts. I believe that nurse practitioners could provide health air and some of the more rural regions and the state of California that presently are highly underserved, and it is unfortunate that we have some people that may be the loser lives, because not getting the attention the medical attention that a nurse practitioner can can appropriately deliver with so much support for this bill and so much evidence in favour. You might think it was a no brainer for it to become law. Of course, it's a no brainer. It's the right thing to do wading through yeah. Why didn't get through coming up on for economics, radio, Greg, resolves keys, reporting continues and we hear why there, regular interest groups that,
the shovel money into the pockets of their members. Also, please consider, making a donation to support this kind of economics, radio episode you can go to free economic start, com, Slash, Doni or text. The word I urge to seven o one o one. We will be right back. I'm Stephen Abner. This is for economics, radio and our producer. Gregg resolve sea has been reporting from California about a legislative fight to allow a nurse practitioners more authority to practice medicine right. Thank Stephen, so democratic state, Senator and Hernandez was telling us about this Billy sponsored which had all kinds of support. Of course, it's a no brainer. It's the right thing to do well:
thing it through as California Medical Association is the political clout that they have here in the capital, the California, Medical Association or CMS. Is this the official of the American Medical Association or anime It's an organization that combines the noncontroversial work of advancing medicine with the controversial work of lobbying, the government for its interests, the prince an economist over Reinhard again, another There are regular interest group that wants to show, the money into the pockets of their members, which is what these associations to that of course, is not how they may sees itself, our mission, the organization says, is to promote the art and science of medicine and the betterment of public health. Reiner believes they may does in fact make legitimate contributions to medicine, it's their contributions to economics and politics that he objects to
As do many other critics. The traditional story about the American Medical Association is just how politically powerful they then that's the University of Maryland historian Christie Shapen, I am authorised. The book ensuring America's health, the public creed. Of the private health care system. The sheep and documents that are book the air may has put us, control role in the development of the. U S: healthcare system. In the nineteen forties, for instance, they help sink. President Harry Truman's pushed for universal health care, It arguably was the largest campaign ever conducted against one piece of legislation, the images also had a strong hand in shaping the medical market place much to the chagrin. A free market advocates, the economist Milton Friedman, for instance, spent much of his career blasting the enemy for using its political and economic power to stifle competition and driver prices. This was
especially the case when it came to the air. Maize control over medical licensing, and the control over that lies in sheer procedure is one has enabled the American Medical Association to exercise its monopoly power, where the Meda Friedman argued that the eight May exerted undue control over every step in licensing doctors the rules governing how to get licensed the people who sit on licensing boards, even which approves school students had to graduate from in order to practice and by some strange accident. The list of approved schools in every state is identical, with a list of schools approved by the American and it was at this control Friedman, said, put an artificial limit on the number of people who could become doctors? Not only that he said licensing prevented perfectly capable medical professionals who aren't doctors from playing a bigger role,
in providing care. You- and I know- and many of us know that there are many medical practices which can perfectly well be carried out by people who do not have the full train. The net effect of licensing he believed was to raise the incomes of doctors and raise healthcare prices, Freeman wasn't a fan of any sort of licensing he sought as away the professions, seize power and exploit consumers. you really want to know the real function of licence. You're licensing. All you have to do is go and see you go down to the state legislature to lobby in favour of licensing. Now, if the real true function of licensing is to protect consumers, you'd expect consumers to be lobbying for licences, but there isn't an occupation. You can name which hasn't down at the state House trying to get licence issued at the California State House, a lot of lobbying in recent years has been aimed at protecting the medical licensure. That already exists, since twenty thirteen, when sent
Ed Hernandez, introduced the first of his to nurse practitioner bills, the California Medical Creation has spent nine million dollars on lobbying activities and another for in dollars and campaign contributions through their pack. It currently employs ten registered lobbyists. These dollar figures are on attached to specific legislation, but has been very clear. Nurse practitioner bills, have been an intense focus of the CMU during that same time period. The California creation of nurse practitioners spent lesson fibres. Thousand dollars on lobbying activities and only hundreds, a thousand dollars on campaign contributions through their pack. The currently when you ploys one registered lobbyist. This is a typical story. The CMU cannot spend anyone looking to expand the scope of pride. This for Hernandez who changes in optometrist. The issue is personal, so
when I graduated in nineteen, eighty six California had one of the weakest scope or practice laws and the profession of optometrists. We still do and years. I've seen how power The Sami is the same is true for republican ally, just stone who trained as a pharmacist. Many will tell you that farmers such as some of the most educated, been utilised healthcare professionals on the planet, can agree with those. So we have we seen these these struggles to expand our scope and and share those frustrations with our american counterparts. When I first begin reporting this story, Senator Stone had picked up. We're Senator Hernandez, left off, introducing new legislation to give nurse practitioners full practice authority in under urban areas, but by the time I got to California, had almost been completely neutered. It is it's become law, but it only allows in peace to independently proscribed one specific drug meant. If I open to abuse
so what happened? Well, unfortunately, we have political realities up here. You know so I'd like to say that its citizens of a state that really governess institution, but I'm gonna, be a first to tell you not if the citizens are in governing who is, while the California Medical Association is very active political organization up here, as a member for the call, the third House and- and they do their job- is to make sure that their physicians are able to to practice without giving up the scope of their practice to any other entities under spotted circumstances, so they're they're powerhouse to it to deal with. So you have this system were basically the rules have been written by the hospitals by the doctor by the farming industry and so on. Over Reinhard again, sir, you should not be surprised that your health spending is doubled. What
It is in other countries where the supply side isn't given nearly the power to write legislation, distracted the health system essay will please it's a system that the American Medical Sosius continues to strongly influence, although not as powerful as I once was. The storing Christie shaping argues its loss legitimacy with a lot of doctors, as I did very careful research on the association. What I found is often time the leaders were out of step with what the rank and file I'll wanted, this was especially the case when the aim is for the creation of Medicare medicate before then, many, a semi five percent of the nation's doctors were a May members. Today, their membership is down to about now. I think twenty percent, but cheapen argues, were still living with the healthcare system there, they fought to create a system that economists, like rain, aren't, have long criticised for its inefficiency and for its feet
for service incentives that drive up costs. It's really something of a shame, but As no question. I am a left, its stamp on the system that we have the stamp seen in many places. For instance, the image has been deeply influential in setting the rates of the government and insurance companies pay for services. These payment rates are lower friend peace than for empties, a much higher for doctors with a specialty critic say this is a big incentive. four specialization at the expense of primary care. They may was also key player influence in Congress. The cap, the number of Medicare funded residencies in the mid nineties nineties, although they and the sea I may have since come out in support of more residency funding as a means of addressing the doktor shortage, however, there remain impose more fundamental reforms. I asked the seamen for the position on using nurse practitioners to fill the primary care. Get they replied quote. California must take immediate steps.
The train and retain more physicians, end quote doing with physician, led team based care is not a viable option for patients. Verona is not opposed to team based care. Is the physician led requirement? He takes issue with rather than saying. Oh yeah, it's great to have nurse practitioners, but this should be under the control of a physician. I dont like that arrangement. I'm an economist. I like competition, going one step further. The economist thing. Baker recently declared that: U S, doctors, so associations by limiting competition are essentially acting like a cartel. This, he argued, is a key reason. Why doc is earned twice as much in the United States and other rich countries, whether through the air may or other institutions. Doctors remain deeply influential in health policy
including in some states, by sitting on licensing boards for nurses, our medical boards, the licensing board, reek of conflicts of interest- and, I insist almost insane, It's like putting the method in charge of them. They are police department and we just don't do that, would you have physician dominating the licensing boards. For nurses so It would have a system where the licensing boards would be less dominated by practising physicians and be clean, as can be of conflicts of interest for starters, but in the case we are talking about today, the full practice authority of nurse practitioners, there's been a big shift, a growing number of states in provider shortages and accelerating costs have gone.
Having granted this authority earlier this year, South Dakota became the twenty second state to give the nod the? U S, department, a veteran affairs recently did the same over objections from the enemy, which means that nurse practitioners have full practice authority, Inv facilities, even in states that withhold their authority, as for states like California, well even there Reinhardt says the time will come and I will tell my friends in the sea it may in California, you will be defeated. You will eventually lose this battle. That was Gregg results, key reporting on the push to upgrade the nurse practitioner model of medicine, the economics of it at least, are pretty straightforward, a more efficient location of resources, would lower costs while maintaining or maybe even improving outcomes, which I think we all agree, the. U S, healthcare system could really use. Remember,
He rank number one in the world in health care expenditure about seventeen percent of GDP on medical access in comes meanwhile, we are nowhere near the top. So there's a lot of room for improvement. Making better use of nurse practitioners seems like one good option and yet good ideas out there. So retail clinics seem to me to be an exam full of something that could increase competition. That's the economist, JANET Curry, I'm TED director of the centre for health and well being at Princeton University for years. Curries. Research was focused on the well being have kids in particular. Lately she got interested in the idea of competition within healthcare. We hear about this a lot having more competition and healthcare markets might improve the way that they function or, conversely, that one of the big problems with healthcare markets is a lack of
competition, you know lots of places that have only one hospital or one hospital Consortium- health, sure said, are very concentrated and so on. For an economist, it's a bedrock belief. Competition helps increase quality and drive down costs, but for competition to be optimal, certain conditions must be met and in the case of health care, almost none of the conditions are met for competition to be up consider a basic one price transparency. So one of the things that really the most messed up about the health care market is aegis don't know how much anything is gonna cost you go to the hospital You ve no idea how much you gonna have to pay for it. It's impossible to make rational decisions freely.
like we're all groping around in the dark. If we don't know how much anything cause there is, however, one healthcare market where prices are posted there called retail clinics. So what is a retail clinic? It's a clinic, like you might imagine, in a drug store where you can just walk. and you don't usually need to have an appointment. They have a limited number of services, they have the price posted for the service and the person they eat. Ie is usually a nurse practitioner theirs not usually any doktor there. The modern retail clinic movement got started in two thousand at a cub foods grocery store in Minneapolis, Saint Paul area, where a company called quick medics set up shop? Quick medics is now known as minute clinic and its owned by the Sea vs pharmacy chain, other pharmacy chains and retailers like Walmart, have followed suit there. Now, when the two thousand reach
clinics in the? U S, they do a lot of immunizations, so things like flew shots are really big. They also do diabetes screenings. They do some asthma type of checks, so the kind of where, if somebody has to chronic condition- and it needs to be checked periodically, you can go to the drug store, get it checked, probably by your supplies, that you need at the same time and dumb and go home. The nurse practice there is at retail Quinnox tree a lot of minor ailments like pink. I urinary tracked infections in Erics, also cuts burns sprains. Dawn. So you can go online. You know Wherever you are looking at their posted price list- and you know exactly what it's gonna cost you to go to sea vs in and get your shot get whatever. It is that you need to do, and so, if
Peter clinics and other types of non conventional providers created enough pressure that other more traditional providers also had to be transparent about prices. I think would have an enormously positive impact on health care, health care access in debates about health policy services. Retail clinics are significantly cheaper than elsewhere. There is also the convenience factor. You don't need an appointment. You can just walk in and walk. Without having to disrupt area your day at all, and I think that's actually really important day.
are usually open on weekends, thorough pen after school there open in the evening, so I've used them frequently. For example, if I had to get a form signed for MIKE Child School in you know, I can just get it done and not have to make an appointment, wait two weeks and then get the form signed. Convenience, however, could have a downside, as JANET Curry encountered when she read some earlier studies on retail clinics. Those studies argued tat. You saw people basically getting more care, so if you make it cheaper and you make it easier than people go more frequently and they argued that on net it was more expensive and not less expensive. Now that wouldn't necessarily be a bad thing if more spending leads to better health outcomes. But more to the point, when Currie examined these studies, she saw they didn't fully consider a huge potential, sir.
of saving in the form of healthcare spending that retail clinics might prevent. There's a lot of emergency room visits for things which in some sense, are not really emergencies now so you're, your child has pink high and can't go to school tomorrow. Unless you get it treated. Awe and the doctors closed, so you, and so you go to the yard. So there is a group of e r visits that you might think could directly go to a retail clinic instead, and there are also e r visits because of simple things said didn't happen. So if somebody has diabetes and they don't take care of it, they could end up in a diabetic. Common have
go to the yard, and so something that was a matter for primary care becomes an emergency. So curried decided to run a robust study on the economics of retail clinics. She partnered with fellow economists. Diane, Alexander and Molly snow. So what we TED was some. We look tat all of the retail clinics in New Jersey. They compared geographic areas that had retail clinics near by
with those that didn't and then analyzed emergency room use in those different areas. They focused on three categories of medical conditions: the first minor things like Erics and pink. I, which had been the subject of the previous studies that found clinics increased spending. But then we are also interested in conditions like flew and die, beat us that send a lot of people to hospital but are preventable through good care. Said that's a second category and the third category were conditions. It would seem to be obviously outside the scope of a retail clinic and so in that category would be thinks like fractures
poisonings and childbirth. You're not gonna, go to sea vs to have your baby you're gonna go straight to the hospital, so curry, Alexander End Chanel ran the numbers to measure how retail clinics affected your visits in these three categories. So what we found was said there was a reduction in air visits for the minor things and that's kind of consistent with what other people had found. Ok, no surprise there, but the new finding really was said there was also a reduction in visits for them preventable care conditions like diabetes in particular and flew so. Access to primary care at clinics does,
to decrease hospital use, and what about the third category of conditions were people having their babies at CBS and then in the third category, where we didn't expect to see any effect, we didn't see any effect, so that was reassuring. They also computed the costs of health care spending in places with and without clinics. Contra, the earlier studies they found on net big savings for consumers and the taxpayers who fun healthcare spending, yes, so our estimate was said, it was about seventy million dollars a year in New Jersey, so the the savings were coming from. Paul getting their minor condition treated in a retail clinic instead of any, are and then the second source of saving with sexually preventing people from getting sick by getting them, flew shots and getting them timely diabetes.
Meanings. Curry thinks that seventy million dollars and savings in one year in one state could actually be a lot more. That's because the state they happened Daddy New Jersey is not one of the twenty two states where nurse practitioners have full practice authority. Well in in New Jersey, the nearest practitioners are operating under the authority of a doctor said they don't really have full practice authority, and so, if they did then for one thing, it might make it more attractive. Foreigners practitioners to take these and hum Secondly, they might have a little bit more discretion in what they were able to do. For instance, nurse practitioners in New Jersey are required to quote collaborate with a physician for prescriptive authority privileges,
I think one of the most important things for promoting retail clinics would be to change. Scope of practice was to make it easier for nurse practitioners to staff them Currie identified another problem with New Jersey, retail health clinics. They aren't allowed to accept Medicaid yeah, that's actually remarkable, so how one of third nurse practitioners We talked to told us that people would come in and say that they were on Medicaid and they're not allowed to treat people who are on Medicaid. The same person would come back and say well I'll pay cash, you know they really do want to go to the hour for some reason so who it seemed kind of crazy that some
let the patient's really want ed and would be cheaper for mad. A cage was not available to them. Curry has come to believe that retail health clinics are generally good, cost effective idea and could be improved by accepting Medicaid and giving nurse practitioners more thorny, Joseph leaves at clinics might pose enough competition forest, traditional healthcare providers- to improve their business practices. So much of the recent healthcare debate has been about the demand side, especially the rise and people with insurance coverage. Curry argues that sure that's important, but it would also be wise to focus on improving the supply side of health care and that site always seems to get ignored in the public policy debate, and it may be because there are very powerful groups like the American that
full association, and so perhaps the government fears to do anything that might impact the the supply side. The AMA, as you might imagine, is not the biggest fan of retail health clinics, especially when they're not supervised by a physician when we asked the aiming for a direct common on clinics and nurse practitioners, they replied quote the Amy encourages physician, led healthcare teams that utilise unique knowledge and valuable contributions of all clinicians to enhance patient outcomes. They also expressed concern that clinics without a supervising, doktor may quote further compartmentalize and fragment healthcare delivery. The AMA argues the importance of continuity of care, meaning access to a doctor that I'll see you regularly
to the concern about continuity of care. I think that's a really big concern and it is a legitimate concern with people going to clinics that they're not gonna, be seeing the same person all the time. I think the problem is what sort of comparing the care from retail clinics to some sort of idealized care which doesn't really exist for most people now you know we all move around a lot. Doctors go you know in and out of practice, doctors move around a lot and you end up seeing different doctors all the time anyway, they Reinhardt JANET curries Fellow Princeton. Healthcare economist is list generous toward the medical associations and while on the one hand you don't accept medicate patients, on the other hand, you were that a Medicaid patient might not get the best quality if they go to a nurse practitioner,
so the argument seems to be for the poor, nothing but the best, and since we don't want to pay for the best, the poor get. Nothing That I find that very cynical posture. Worse yet Reinhardt argues the influence of associations like the AMA, an see I may is still great Sk we outsize there. We don't really have a democracy in the way we did that in high school, it's more plutocracy really a thing run by interest groups what the average american patient, Dreams about once is completely irrelevant, as I always put it. What ten million Americans might want to aspired to is nothing compared to what one K street lobbyists things
about in the morning in the shower. That was once again the Princeton economist movie rain. Her very sad news, to share with you. Just before releasing this episode, we learned that Reinhardt had died. He was eighty years old Reinhardt was when the great minds on health care economics always thinking about how to improve the system. It was also a friend of this programme and we feel privilege to have interviewed him several times our condolences to his family and our thanks to obey for all that. He taught us coming up next time on for economics, radio, this past election day, the state of Texas past
random that? Allow banks to offer a prize linked savings plan would sometimes called a no lose lottery. It's a smart policy idea, a great alternative to the high risk low returned state lottery, and you want to know how that Texas LAW came to pass. It started with one person who happened to listen to one episode of Economics: Radio, about the no lose lottery. So a lot of Americans think the lottery is their only chance at winning big sums of money weren't. We take that appetite for gambling for a product like this and attaches to a savings vehicle that offers some positive return is a win win situation. So next week will revisit our episode is
America ready for a new lose lottery and will hear from the guy who got the ball rolling in Texas, sometimes our show can actually help get something done, and that's in large part thanks to your generosity. So please do consider joining all the other people who support this show by making a donation go to free economics, dot com, such donate or text. The word no, The seven o one o one thanks for economics, radio is produced by w and mighty studios and w productions. This episode was produced by Gregg results. Can our staff also includes
how can vary, Merit Jacob Stephanie, Tam, Eliza, Lambert, Emma Morgenstern Harry Huggins, and bring you tear, as we also help this week from Zack Le Pen, Ski and Dan dissolve the music you here throughout the episode was composed by Luis scare. You can subscribe to reconnect with radio on apple pod casts doubt your or wherever you get your progress. You should also check out our archive reconnects DOT Tk. Will you can scream or download every episode we ve ever may there more than three hundred by now. You can also read the transcripts and find links to the underlying academic research. We can also be found on Twitter Facebook or be it email at radio at for economics, thanks.
Transcript generated on 2021-01-22.