100 years of medical robbery

[ShakeZula06]

100 years of Medical Robbery
Another good article over the history of state intervention in the healthcare industry (see this thread if you haven't). Dale Steinreich goes over the ways the American Medical Association have used government power to raise physician income levels by any means possible.
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To accomplish the twin goals of artificially elevated incomes and worship by patients, AMA formulated a two-pronged strategy for the labor market for physicians. First, use the coercive power of the state to limit the practices of physician competitors such as homeopaths, pharmacists, midwives, nurses, and later, chiropractors. [5] [6] Second, significantly restrict entrance to the profession by restricting the number of approved medical schools in operation and thus the number of students admitted to those approved schools yearly. [7]

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The AMA used it’s power first to increase demand for physicians by limiting it’s competition, and then pounced on the chance to artificially decrease supply. Under the guise of the schools' education not being up to the AMA standard, they shut down 35 medical schools in just 6 years, while decreasing the amount of accepted students at the remaining schools.
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In six years the Council managed to close down 35 schools and its secretary N.P. Colwell engineered what came to be known as the Flexner Report of 1910. The Report was supposedly written by Abraham Flexner, the former owner of a bankrupt prep school who was neither a doctor nor a recognized authority on medical education. Years later Flexner admitted that he knew little about medicine or how to differentiate between different qualities of medical education. Regardless, state medical boards used the Report as a basis for closing 25 medical schools in three years and reducing the number of students by 50% at remaining schools.


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This practice is still effecting us today-
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Since AMA's creation of the Council a century ago, the U.S. population (75 million in 1900, 288 million in 2002) has increased in size by 284%, yet the number of medical schools has declined by 26% to 123.

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This is combined with the fact that not only did they limit the amount of schools, they also limited the amount of students that can get into schools:
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In terms of admissions limits, the peak year for applicants at U.S. schools was 1996 at 47,000 applications with a limit of 16,500 accepted. [10] This works out to roughly 64% of applications rejected. [11] On a micro level, for the last six years the University of Alabama (hardly a beacon of prestige in the medical discipline) has averaged about 1,498 applicants per year with an average of about 194 accepted. This is about an 87% rejection rate. The sizes of the entering classes have been of course even smaller, averaging about 161.

AMA would likely argue that there's nothing necessarily wrong with very high rejection rates. This is correct, except for the fact that these rates are being applied to pools of candidates who are cream-of-the-crop in quality and have put themselves through a very costly admissions process.

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Besides limiting the amount of doctors and thus artificially raising the costs, artificially high rejection rates to these schools raises the prices to get into those schools. Thus not only do prices raise more (to cover the cost of becoming a doctor in the first place) this also decreases social mobility by having whether or not you make it into medical school depend on having rich parents and/or knowing someone important. Just one of many ways governments decrease wealth equality and social mobility. The AMA must have felt dirty about that as they do have a fairly anti-white and Asian affirmative action policy.

With their artificially increased market share surprise, surprise, inefficiencies occurred.
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The second blowout on our shiny Lexus would be the number of unnecessary/questionable procedures performed on patients every year. Ex-surgeon Julian Whitaker (1995) tirelessly rails against the excesses of angioplasty (PTCA), atherectomy (directional and rotational), and coronary bypass. \l "_14_" Whitaker states that, with few exceptions, all three procedures for heart-disease patients have been empirically shown to be utter failures in terms of solving short-term problems without creating long-term problems which are much worse.


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The article lists several examples of such horrible results for a more in-depth look at the problems with the current medicine market. One comprehensive study shows that bypasses have been completely ineffective. Another shows that over 50% of bypasses are unnecessary in the first place. Yet another study estimates 120,000 accidental deaths occur a year from hospitals. Interesting fact-
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there's also no doubt that AMA-backed restrictions against greater specialization have helped wreak their havoc over time as well. \l "_30_" A later study by Leape [ \l "_31_"] showed that just the presence of a pharmacist on physician rounds reduced adverse drug reactions from prescribing errors by 66%.


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Great article. Hopefully clears up that typical government intervention on behalf of special interest groups and lobbyists is to blame for our current healthcare hellhole and not the market.
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A happy 100th birthday to the Council on Medical Education...and for the sake of all our health, hopefully not too many more.


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