Introduction: The Need to Reconsider A Variety of Occupational Licensing Laws
Occupational licensing requirements have existed in the United States since colonial times. (1) For most of our history, the number of workers subject to licensing requirements was quite small, approximately five percent. (2) That number, however, has steadily increased since the 1950s. Today, approximately thirty percent of all workers are subject to such a requirement, with service industry professionals most likely to be regulated by licensing requirements. (3)
Those requirements have recently come under sharp and repeated criticisms from a variety of commentators in professional journals and the media. Scholars in economics, (4) law, (5) and public policy (6) have criticized occupational licensing requirements as ordinarily being little more than legalized cartels, (7) noted for their proclivity to reduce supply and raise prices without producing any corresponding increase in quality. (8) Officials in the legislative, (9) executive, (10) and judicial (11) branches have responded to these criticisms by gradually starting to re-examine the merits of various occupational licensing requirements. The bulk of the discussion has focused on occupations such as barbering, cosmetology, floristry, taxi drivers, interior design, and the like. (12) Less attention has been paid to the health care professions. This Article seeks to address that deficiency.
America currently has a lack of qualified physicians to meet the needs of a growing--and aging--population. (13) That shortage is a serious problem, and it is attributable in part to the current medical licensure process. (14) Fortunately, the shortage of qualified physicians in the United States is a problem that can be addressed through policy. Reforms to medical licensure can have a material impact on access to care. (15) Although there are certainly other worthwhile reforms to address the paucity of medical providers, (16) this Article proposes two possible reforms that could ameliorate the current shortage of physicians: (1) states should streamline entry for experienced physicians from abroad, and (2) states should have provisional licensing for medical school graduates who do not find a residency position after graduation.
This Article makes those arguments as follows. Parts I and II describe the current shortfall of physicians in the United States and the sources from which physicians come. Part III describes the current system of American medical licensure and how that system produces an inadequate number of licensed physicians. Part IV discusses the question of whether the current medical training and licensing process is appropriate. It concludes that, although necessary, the current system can be modified and improved. Part V offers some remedies that maintain the necessary features of medical licensing but ensure that a larger number of qualified medical school graduates are available to participate in patient care to help alleviate the current physician shortfall.
The Current Shortage of Physicians
Access to medical care has been a problem, especially in rural areas, for decades. (17) Although nearly 20 percent of the American population lives in rural areas, fewer than 10 percent of primary care providers practice in such areas. (18) In fact, as of 2016, the U.S. Department of Health and Human Services designated more than 6,000 areas of the country, population groups, or health care facilities as having a shortage of primary care physicians. (19) Unfortunately, this problem is only going to worsen over the next decade. The Association of American Medical colleges (AAMc) projects a nationwide shortage of between 40,800 and 104,900 physicians in both primary and specialty care throughout the country by 2030. (20) Appendix A illustrates the shortage that we are facing.
The reason for this shortfall is that the demand for physician services is expected to grow faster than the supply. Americans are aging. The number of Americans aged 65 and older is forecasted to grow by more than half (55 percent) from 2015 to 2030. (21) Without a comparable increase in the number of practicing physicians, there will be inadequate access to necessary health care services throughout many areas of the country regardless of what medical coverage and payment structure the nation ultimately adopts. (22) The states, which are responsible for licensing physicians, should take the lead in meeting the needs of the population in (at least) two ways. First, the states should streamline the processes whereby qualified and experienced doctors from foreign countries can practice medicine in this country. Second, the states should allow American medical schools graduates who are not members of a residency program to receive provisional licensure to practice under the supervision of a licensed physician. (23)
This impending physician shortage is a pressing problem that needs to be addressed immediately. Understanding the nature of the problem requires a detailed discussion of the evolution of the education and training of physicians in America.
The Current Source of Physicians
In order to become a practicing physician, prospective doctors are required to graduate from an accredited medical school. The Liaison Commission on Medical Education, an entity co-sponsored by the American Medical Association and the Association of American Medical Colleges, accredits American medical schools. (24) Foreign medical school graduates must receive certification from the Educational commission of Foreign Medical Graduates (ECFMG) to enter a residency program. (25) The ECFMG requires that foreign graduates have graduated from an institution listed in the World Dictionary of Medical Schools and have passed the first two steps of the United States Medical Licensing Exams (USMLE). (26) Graduates of an accredited residency-training program can then pursue additional GME training via fellowships to prepare them further to practice in particular subspecialties (e.g., pediatric heart surgery). (27)
Postgraduate medical training already existed for well over the course of the last century. Initially, however, much of this training was offered informally via short courses, apprenticeships, or brief periods of study in Europe. (28) Until the 1960s, American hospitals handled the costs of GME directly. Beginning in 1965, however, the federal government became formally involved in postgraduate medical training by making GME funding a required component of Medicare spending. (29) Other government agencies, such as Medicaid, the Veterans Administration, and the Health Resources and Services Administration (HRSA) also provide financial support for GME, but to a much lesser extent. (30)
In the first three decades following the implementation of Medicare, government spending on GME grew at an alarming rate. (31) As a result, when President Bill Clinton signed into law the Balanced Budget Act of 1997, (32) it included a provision that capped the number of Medicare-funded residency slots at 1996 levels, a cap that has remained in place for the last two decades. (33) Today, taxpayers contribute more than $10 billion per year to GME funding, over $9 billion of which comes from Medicare. (34) Health Research and Services Administration (HRSA) funding constituted slightly under $300 million in taxpayer funds, and the Veterans Administration spends in between $1.4 and $1.5 billion per year. Private sources also supply an unspecified amount of GME funding. (35)
Each September, senior medical students, as well as some medical school graduates, apply for GME training positions through the National Residency Matching Program (NRMP). (36) Postgraduate training can last from three to seven years and training programs receive accreditation from a nonprofit organization known as the Accreditation Council for Graduate Medical Education (ACGME). The curricula are structured according to guidelines from ABMS member groups for each specialty. (37) After completing a residency training program, graduates are eligible to sit for the board certification examination specific to their chosen specialty and written by the associated ABMS member group. (38)
The Current System of Medical Licensure
The postgraduate requirements to receive a medical license vary by state. All states require some graduate training, from one to three years, in addition to completion of the final step of the USMLE before granting a license. (39) That license enables the trainee to practice medicine in the state in which it is issued. (40) Even though board certification is technically a voluntary process and completing a residency training program is not always a requirement for medical licensure, it is usually in the trainee's interest to do so. Graduation from an ACGME accredited program is a prerequisite for board certification and a physician who is not board certified might find it very difficult, if not impossible, to obtain hospital staff privileges, affordable malpractice insurance, or reimbursement from insurance companies. (41)
Two major nongovernment entities, ACGME and ABMS, occupy key positions in the educational accreditation, licensure, and certification of doctors in this country. (42) Those organizations are technically private entities. Nonetheless, because residency programs accredited by the ACGME are structured according to criteria determined by the ABMS member boards, and all state licensing boards require at least some participation in these programs before granting a medical license, those organizations effectively monopolize the only pathway to physician licensure and certification in America.
The current domestic postgraduate physician training and licensing processes have a negative effect on access to care for a variety of reasons.
There Is an Insufficient Number of Training Positions
The number of medical graduates matching into a...