One way to make a service cheaper is to increase the number of people who offer it—and nowhere is this more needed than healthcare. In the brief video above, Vox’s Matt Yglesias explains how only 19 states and the District allow nurse practitioners broad powers to do primary care on their own. The rest of the country, including some of the biggest states like Texas and California,does not. Yglesias is right to hone in on this as one clear example of rent seeking on the part of doctors, who don’t want competition from NPs. But there’s another example he doesn’t mention in the video: federal residency restrictions. We need more NPs to compete with doctors, but we also need more doctors to compete with doctors. The Advisory Board Company explains why spots for post-medical school residency spots are limited:
Currently, the cost of training a new resident is about $145,000 a year, and Medicare currently funds more than 75% of doctor residencies.
However, the number of students accepted into federally funded residency programs has been capped at 85,000 for the past 15 years. In addition, federal Medicare payments have been cut by the federal health care reform law and many states face deficits that prevent them from contributing training funds, according to AAMC Chief Policy Officer Atul Grover.
The restriction on federal funding for residency programs also impacts medical schools. According to the National Resident Matching Program, the number of residency applicants exceeds the number of available positions, preventing medical schools from expanding.
And that’s still not the end of it. There are also caps on the number of federally funded spots for foreign physicians in the U.S., mixed with cumbersome regulations to keep them out of the system. It’s long past time to open the flood gates and let new care providers into the system.