The projected health shortage under medicare for all exacerbates retirement and the health crisis

FTI Consulting examined the impact of Medicare for All on the supply of physicians, finding a significant increase in the projected shortage of both specialists and primary care physicians in future years as a result of rate setting and subsequent reductions in provider income. American physicians enter the workforce with an average student debt load of nearly $200,000,12 a factor that may drive graduates away from specialties with particularly low Medicare reimbursements, such as primary care, under the current system. For experienced physicians, declining Medicare reimbursements can play a role in the decision to retire early.13 FTI’s analysis demonstrates these factors would be amplified under Medicare for All, discouraging the next generation from entering the practice of medicine and prompting a greater number of older physicians to retire early.

IMPACT ON PHYSICIAN SUPPLY On average, Medicare reimbursements for physicians were about 75% of private insurance reimbursements for the same service in 201714 and are expected to fall to approximately 63% by 2025.15 Because Medicare for All’s most significant effect would be to replace private coverage, total reimbursements paid to physicians would also fall absent changes to the law. FTI estimates that, under Medicare for All, the U.S. could expect a loss of more than 0.13 physicians per 1,000 people once the policy is fully implemented. The current ratio in the United States is 2.46 physicians per 1,000, which translates to a nationwide loss of 44,693 physicians by 2050, compared to the projected number of physicians under current law.16

In 2019, the AAMC projected a gap of between 46,900 and 121,900 physicians by 2032. Using those projections, and combining with the expected loss of physicians, we estimate that the physician shortfall will be between 90,353 and 236,053 by 2050 even before the reduction has taken full effect.17 Figure 2 – Physician Shortage over Time

PRIMARY CARE PHYSICIANS Understanding the impact of Medicare for All on the primary care physician workforce is particularly important as these providers not only form the foundation of the health care system but are also central to the movement toward value-based care. Even without the downward pressure of Medicare for All on primary care incomes, demand for primary care appears to exceed supply. Between 2010 and 2017, the ratio of primary care physicians to beneficiaries fell from 3.8 per 1,000 to 3.5 per 1,000, according to the Medicare Payment Advisory Commission (MedPAC). At the same time, beneficiaries looking for a new doctor generally reported more problems finding one when seeking a new primary care doctor than when seeking a new specialist.18 Using international data on primary care physicians’ salaries and numbers, FTI Consulting estimates that enacting Medicare for All would result in a nationwide reduction in primary care physicians of 10,286 by 2050, resulting in a corresponding shortage of primary care physicians of between 36,206 and 107,426