The Doctor’s Advocate | Third Quarter 2018
From the Chairman

Advocates for the Medical Profession in a Time of Upheaval

Richard E. Anderson, MD, FACP, Chairman and CEO

Healthcare delivery continues to experience unprecedented change. Economic forces have produced nearly continuous consolidation. The increasing use of technology has made care more complex, but not more streamlined or less costly. Primary care physicians are morphing into team leaders while national corporations practice retail medicine. The one constant is the unrelenting pressure faced by practicing physicians. Doctors face overbooked schedules, excessive documentation requirements baked into user-unfriendly electronic medical records, and incessant demands from insurance companies to justify their care both before and after the fact. There are now thousands of “practice guidelines,” often based on limited evidence, that are frequently ambiguous and sometimes contradictory. All of this is occurring within the context of more than 40 years of never-ending litigation pressure.

It’s no wonder doctors struggle with burnout.

Against this backdrop, doctors, medical practices, and health systems need an advocate—an unconflicted voice loud enough to be heard. With our mission to advance, protect, and reward the practice of good medicine, The Doctors Company is ideally positioned and proud to accept this responsibility.

A recently completed survey of our members revealed that seven out of 10 said they would not recommend healthcare as a profession—a profession that has for many generations attracted our best and brightest. How has all of this come about?

Isn’t the Politicization of Medicine Driving All This Change?

No, the primary driver of this cycle of change is economic. Eighteen percent of the American economy is in play, and some of the largest corporations in the world are vying for primacy. While nearly everyone agrees that healthcare in America is too expensive ($3.3 trillion per year, or $10,348 per person), these changes aren’t based on improving healthcare outcomes or thoughtful healthcare policy deliberations. It’s estimated that spending on healthcare mergers and acquisitions will reach half a trillion dollars this year. They are fundamentally driven by economic rationalization. Certainly, a systems approach to medical problem solving could be of great benefit, but that is the promise, not the premise, of this cycle.

This wave of consolidation is reflected in our own membership. In 2004, two-thirds of doctors we insured were in groups of five or fewer. Today, that number is less than half (47 percent). We know where they’re going: Over the same period, our largest groups (more than 100 doctors) have increased from 13 percent to 26 percent of our membership.

Today, none of the 306 geographic healthcare markets economists identify in the United States are considered “highly competitive.” In fact, about half are now highly concentrated—which means a small number of healthcare companies provide most of the services. We also have good evidence that healthcare consolidation does not lower prices. While consolidation may reduce some costs due to efficiencies and economies of scale, multiple studies show that prices actually increase significantly―as much as 25 to 40 percent―following consolidation. So far, consolidation is not making healthcare less expensive.

What Are Some of the Pressures?

It is becoming extremely difficult to practice primary care medicine in the United States. The economics are daunting. Our societal expectation of 24/7/365 service is almost impossible for small practices to meet. The clerical burdens of care coordination and payments are enormous. And electronic health records (EHRs), which should ease these burdens, have had precisely the opposite effect. In our survey, more than 60 percent of respondents said EHRs have a negative effect on practice efficiency and productivity—and more than 50 percent said that EHRs have a negative impact on their relationships with patients.

We know there is already a shortage of primary care physicians, and expectations are that it will only get worse. By 2020, more primary care physicians will retire every year than will graduate from primary care residencies. Of those doctors who responded to our survey, many suggested that changes to the practice of medicine may speed up their retirement. On the other hand, approximately 28,000 new nurse practitioners and physician assistants graduate every year—by 2025, it’s likely that one-third of primary practitioners in the U.S. will be nurse practitioners.

Retail medicine continues to proliferate. Caremark, Walgreens, Walmart, and others now operate thousands of walk-in clinics, and the number increases annually.

More and more, medical practices are reliant on EHRs. They are necessary for mandated quality assurance and centralized data reporting, and for compensation. Incredibly, this technology has increased—not reduced—the burden on practicing physicians. The Annals of Internal Medicine reported that every hour of clinical care provided by a doctor is associated with two hours of time spent on medical records and desk work. The publication also found, in a time-motion study of practicing physicians, that 37 percent of time with patients is spent interacting with the health record. This use of physician (and patient) time is wildly inappropriate and has had the effect of reintroducing the medieval profession of “scribe” back into modern medicine. More than half of doctors who completed our survey felt that EHRs negatively impact the doctor-patient relationship—and EHRs also emerged as the top cause of physician burnout.

Given the Institutionalization of Medicine, Who Bears the Burden of Risk Today?

Though physicians account for only about 20 percent of the cost of healthcare, they pay 60 percent of all the professional liability premium in the United States. This fact alone underscores the primary driver of defensive medicine.

There is some good news: The frequency of lawsuits against doctors has declined significantly in the last 15 years. Nationwide, there are 40 to 50 percent fewer malpractice claims today than we experienced previously. However, the average cost of a claim—what we call severity—has risen about 50 percent over the same period.

Will Evidence-Based Care Resolve These Pressures?

Not in the near term. Physicians routinely encounter confusing and often contradictory practice guidelines that can be barriers to delivering optimal care. For example, even though more than 65 percent of women over 40 undergo mammography at least every two years, there are a plethora of conflicting guidelines from reputable organizations, including the American Cancer Society, the American College of Radiology, and the National Cancer Institute.

A recent study in the Journal of the American Medical Association found that two-thirds of the clinical recommendations in the respected medical reference UpToDate were based on inconclusive evidence. This makes life difficult for physicians (and patients) and easy for the plaintiffs’ attorneys. If the outcome was adverse and the guideline was followed, then the care itself is called negligent. If the outcome was adverse and the guideline wasn’t followed, then the guideline should have been followed. It’s a no-win situation for the profession.

A new and potentially explosive source of exposure for doctors may arise as millions of patients are threatened with the loss of their health insurance. If this occurs in the context of ongoing care and no alternatives are available, allegations of patient abandonment are likely to arise.

I Believe in Our Profession

The pressures of practicing medicine today are extreme. Consolidation is not reversible, litigation remains a constant threat, and doctors must adapt to new technology and changing roles.

The Doctors Company was founded more than 40 years ago during a medical malpractice crisis in California. Malpractice lawsuits and jury awards in California skyrocketed, and most commercial insurance companies concluded the practice of medicine was not an insurable risk. The passage of the Medical Injury Compensation Reform Act (MICRA) led to the establishment of physician-owned insurers like The Doctors Company, and we have provided the majority of physician professional liability insurance in the United States ever since.

Today, the rate of change is even higher and the practice pressures greater. Our mission has not changed: to advance, protect, and reward the practice of good medicine. We are steadfast in our belief that medicine is a noble profession. We are determined to provide an enduring national platform to advocate for the profession and the life-sustaining services it provides.

Learn More

The Doctors Company has released the results of the Future of Healthcare Survey. More than 3,000 doctors participated in the survey, which queried respondents about changing care delivery and practice models, EHRs, bundled payments, burnout, and more. For a copy of the report, visit

The Doctor’s Advocate is published by The Doctors Company to advise and inform its members about loss prevention and insurance issues.

The guidelines suggested in this newsletter are not rules, do not constitute legal advice, and do not ensure a successful outcome. They attempt to define principles of practice for providing appropriate care. The principles are not inclusive of all proper methods of care nor exclusive of other methods reasonably directed at obtaining the same results.

The ultimate decision regarding the appropriateness of any treatment must be made by each healthcare provider considering the circumstances of the individual situation and in accordance with the laws of the jurisdiction in which the care is rendered.

The Doctor’s Advocate is published quarterly by Corporate Communications, The Doctors Company. Letters and articles, to be edited and published at the editor’s discretion, are welcome. The views expressed are those of the letter writer and do not necessarily reflect the opinion or official policy of The Doctors Company. Please sign your letters, and address them to the editor.

Third Quarter 2018

From the Chairman
Advocates for the Medical Profession in a Time of Upheaval

An Ounce of Prevention
Medical Office Assessments Uncover Hidden Liability Risks

Government Relations Report
New Limits on Doctor-Patient Confidentiality

New CME Courses Address Distracted Practice Concerns

Innovations in Patient Safety
Influencing Patient Behaviors in Orthopedic Practice

The Back Page
Industry and Company News

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