Study tracks quality of professional life: Practice climate shows a decade of decline

Massachusetts Medical Society's research shows that its practice environment index has dropped steadily, thanks to everything from managed care hassles to rising real estate costs.

By Mike Norbut — Posted May 15, 2006

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Stephen Hoffmann, MD, an internist in solo practice in Framingham, Mass., has been seeking a physician to join him for a long time, with no success. As he waits, his day gets busier -- even though his patient load is not growing -- because of hassles in dealing with insurance companies and other "back-seat drivers" in health care.

"It's like walking through molasses to get through the day, and it's not fair to patients," Dr. Hoffmann said.

Dr. Hoffmann's story is a familiar one to physicians around the country. Their angst is quantified by the latest Physician Practice Environment Index, published by the Massachusetts Medical Society, which shows doctors' professional and personal lives are being more hampered each year.

The national index total fell 2.2% from 2004 to 2005, marking the 10th consecutive year the measurement has fallen, according to the medical society. The total in Massachusetts, the only individual state measured, dropped for the 12th consecutive year, including a 1.8% dip from 2004 to 2005.

The practice index is based on nine factors: the number of medical school applications; the percentage of doctors older than 55; median physician income; the number of employment ads listed in the New England Journal of Medicine; the ratio of housing prices to median income; professional liability costs; physician cost of maintaining a practice; mean hours per week spent in patient care; and the annual number of visits per emergency department.

The medical society hires an economics firm to conduct the statistical analysis of the nine factors, the data for which come from several outside sources, including the AMA. The medical society weights the factors based on their importance to the overall practice environment.

This year, cost and a greater disparity between housing prices and physician income were major factors in the index drop, the MMS said.

Practice operating costs rose 4.7% nationally and nearly 4% in Massachusetts last year, according to the medical society report. Wages, rental rates and medical supply costs all rose last year, contributing to the overall increase. Doctors also pointed to high medical liability insurance costs, which rose an average of 7.4% nationally, according to the report. Between 1992 and 2005, liability costs have increased 160% nationally, the report said.

"I think this is pretty consistent with what we're seeing across the country, particularly the rise in practice costs," said AMA President J. Edward Hill, MD.

Even though liability rates held steady in Massachusetts last year, they still represent more than 10% of a physician practice's total business costs, the MMS said. Internists in Massachusetts insured through Boston-based ProMutual Group paid just less than $13,000 in 2005 for liability coverage, while general surgeons paid just less than $40,000 and ob-gyns paid about $105,000, according to the 2005 edition of Medical Liability Monitor, an independent national newsletter that tracks premiums.

When the pending cut in Medicare payment and declining reimbursement rates from other insurers are factored in, it's easy to see why physician income can't keep up with housing prices, doctors said.

If the Medicare payment cut is enacted as scheduled next year, "we're getting to the point where physicians are going to have to make a very painful decision, whether they can keep accepting Medicare patients," Dr. Hill said.

For some doctors, the decision could be even more painful. Dr. Hoffmann said the Massachusetts practice environment is forcing him to consider leaving the state.

"I would have to move," Dr. Hoffmann said. "I consider it a real honor to be a doctor. A lot of us, deservedly so, don't see things getting better. They only see things going from bad to worse."

Just attracting physicians to Massachusetts is becoming a more difficult challenge, according to the index. Employment ads in the New England Journal of Medicine were up 15.4% last year. This offers further evidence that physicians are not willing to work in the current practice environment, the medical society said.

"We've been able to trace it over time, but unfortunately, it's been a steady deterioration," said Alan M. Harvey, MD, president of the Massachusetts Medical Society. "Physicians will do everything they can to keep their practices open and continue to see patients, but the viability of practices is tenuous at best."

Marylou Buyse, MD, president of the Massachusetts Assn. of Health Plans and a former MMS president, said health plans are an easy target for physicians' angst.

But the index is more a measure of the whole environment than of relationships between doctors and insurers, she said. For example, "everyone in Massachusetts is confronted by the high cost of housing," she said. The Massachusetts Assn. of Realtors reported the average price for detached single-family houses doubled between 1998 and 2005, from $217,103 to $443,071 -- the highest in the country. However, housing costs in much of the country have increased rapidly as well.

"I think this is much bigger than just the health plans," said Dr. Buyse, a family physician who still practices part time.

But physicians said health plans can do their part to make the practice environment a little easier for them. Dr. Hoffmann said with all the rules, regulations, and approvals necessary to set up a test for a patient, more physicians are forced to practice with someone "looking over our shoulder."

"It's become cookbook medicine, and to continue the metaphor, it's a recipe for disaster," Dr. Hoffmann said.

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Practice conditions deteriorate

According to the Massachusetts Medical Society's Physician Practice Environment Index, national practice conditions for doctors have gotten progressively worse over the last decade or so. The index (1992 = 100) is calculated based on nine different factors, from housing costs to medical school applications to doctors' cost of doing business.

U.S. Index
1992 100.0 100.0
1993 102.2 101.4
1994 100.9 100.4
1995 98.3 101.8
1996 96.3 101.1
1997 94.5 99.3
1998 91.8 92.5
1999 90.5 91.2
2000 85.3 88.2
2001 82.2 85.6
2002 79.2 84.3
2003 76.4 81.7
2004 75.0 79.9
2005 73.6 77.2

Source: Massachusetts Medical Society

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