6. Healthcare
6.3 Number of Doctors and Their Payment
I estimate that such a checkup day takes about three hours of physician time (distributed among the general practitioner (in most cases the patient's family doctor) and various specialists). Therefore, to be able to carry out this checkup every year for every citizen, approximately 17 doctors per 10,000 inhabitants would be needed.37 We will need more than 43 doctors per 10,000 inhabitants for our healthcare system if we already tie up so much working time with preventive medical checkups.
This chapter is not intended to be a guide for restructuring the German healthcare system, but rather a redesign to create (in any country) better healthcare. For those who are interested, a cost estimate regarding the feasibility of this follows in the box.
Cost estimate: To avoid having to calculate all the figures for this cost estimate from scratch, a comparison with the costs of the German healthcare system seems like a good idea.
Currently (as of 2024), statutory health insurance companies have €306 billion per year at their disposal, with a contribution rate of around 15% and 90% population coverage. We will abolish private insurance as an alternative, so we can expect 100% coverage. On the other hand, I initially want to try to manage with a 10% contribution rate. (306/0.9)/1.5 = €226 billion. Roughly estimated, up to 1/3 of this money could be spent on doctors and nurses. If this proportion rises much higher, there would be a lack of funds for therapists, medication, assistive devices, hospitals, vehicles, education, administration, etc.
That means we can spend up to €75 billion annually on salaries for doctors and nurses.
Assuming we have significantly more doctors than before, two nurses per doctor should be sufficient. Doctors currently earn an average of €8,200 per month.[33] Since we can burden them less (since there are many more doctors), we can, with a clear conscience, lower this salary to an average of €6,000 per month. Nurses earn an average of €2,700 per month.[34] To attract enough nurses, we should pay them a bit more, let's say €3,000 per month. This means that 1 doctor + 2 nurses cost approximately €150,000 salary per year (12 × (6,000€ + 2 × 3,000€) = 144,000€).
Now that we have budget and costs, we can calculate the doctor density resulting from that:
75,000,000,000€ / 150,000€ = 500,000 doctors. 500,000 doctors / 85,000,000 inhabitants × 10,000 = 58.8 doctors per 10,000 inhabitants.
Under these assumptions, Germany can afford 500,000 doctors and 1,000,000 nurses. That's 59 doctors and 118 nurses per 10,000 inhabitants...
Okay, goal missed. That's slightly more doctors and slightly fewer nurses than we currently have (43 and 132 per 10,000 inhabitants). However, we want significantly more doctors, and for that we will have to spend significantly more money than assumed in this calculation.
So, let's make the following adjustment to have more money available for salaries: We'll leave all other healthcare expenses at the same level we achieve with the 10% contribution rate, and increase the contribution rate by the amount we need to be able to pay 100 doctors per 10,000 inhabitants instead of 60. We used 1/3 of the contribution rate for salaries (3.3%) and need to multiply that by 10/6. That gives us a contribution rate of 12.2%. 5.5% of the contribution rate is spent on salaries for nurses and doctors (45% of the total costs).
I think the profession of a doctor can be transformed even further in the direction of a normal job. Something that isn't paid royally, but also only has a normal workload and stress level. Which makes the scenario we have calculated here, with a monthly salary of €6,000, a pessimistic one. Which is good, since the goal of this rough calculation was to show that more doctors are financially viable.
So, our considerations regarding financial viability have shown that while it's neither easy nor cheap, it is definitely possible to pay more doctors and nurses. For our design, we are allocating one doctor and two nurses per 100 inhabitants. That's 2.3 times as many doctors and 50% more nurses than before.
In principle, there should be enough applicants for that. We're reducing workload and stress levels, and we've also increased the salaries of the nurses. I think if we spend 12.2% of our income on healthcare (Germany is currently above that at 14.6%), then it's also justified that 3% of the population work as doctors and nurses.
We are planning to spend almost half of the total healthcare budget on the salaries of doctors and nurses. That means that in everything else we spend money on in healthcare, we have to manage our resources much more carefully than Germany currently does, in order to be able to pay for everything. With this, we have already made the first ethical decision. As stated at the beginning of the chapter, there is not enough money to pay for everything for everyone. So we want to shift the balance away from spending on administration and medication, towards spending on proper and early diagnoses, thorough treatments, and time to talk. I think it's much more important to pay enough doctors and other staff, rather than spending the money on the most expensive medications and equipment. Because what good are they if no one has time to talk to the patients and recognize their problems early on?
So how can we organize healthcare more efficiently, to manage the money remaining after deducting the salaries of doctors and nurses as well as possible?
I think a good start has already been made with the bundled preventive health checkups.
There was talk of polyclinics where these would take place. Not just for checkups: It's a good idea for doctors of different specialties to practice in the same building for many reasons. For example, it ensures that doctors have to spend less time and energy on administration and can instead focus more on their patients. Patients save time and travel if they can switch directly to another doctor in the same building instead of needing a referral. And of course, it is also significantly more efficient and cost-effective when the reception, appointment scheduling, various rooms, and technical equipment are shared by multiple doctors.
But the most important and fundamental question we need to clarify is the payment of doctors. More specifically: the incentive system for doctors to do a good job. Are doctors employees or self-employed? If employees, are they paid by the state or by a private company? Does the state pay money based on diagnosis-related groups (DRGs), based on expenses, or simply a fixed salary?
I've been thinking a lot about private sector incentives. But no matter how I twist and turn it, whether with DRGs, based on success, or based on effort, there will always be ways to strive for more money instead of doing what's best for the patients. The monetary incentive and the well-being of patients cannot be balanced if the market is supposed to regulate these things. In many other areas, this can be compensated for by informed consumers. The consumer researches and then buys the product or service that he or she considers to be the best. However for patients without medical training and who need to make quick decisions in an emergency, this principle does not work at all.
I therefore propose a state-organized healthcare system, with doctors paid by the state. This allows the state to monitor them far better than if the doctors were self-employed or paid by a private company. However, this fundamental decision also places high demands on the state, or rather on our system design: Instead of simply saying “the market will regulate it”, it is the state that must create all the incentive structures. There's a reason why command economies have never worked well in reality: the state is overwhelmed by having to make so many detailed decisions well. To minimize this problem, we will let the doctors themselves make many of the decisions. And the decisions the state does make should, wherever possible, follow clear rules rather than being guided by political considerations that change by the day.
At least the computer support for decision making available today (see Chapter 4.3 “Digitalization”) is worlds better than it was during the time of the Soviet Union. Well then, let's get to work!
In order for the state to efficiently manage the healthcare system, every doctor transmits all information about their patients to the state. What examinations he carried out with what results, all lab values and X-rays, diagnoses made, treatments and referrals. The state centrally manages all health data of the entire population.
Once we've made the decision that the state, as a central authority, manages healthcare and centrally administers all citizens' health data, we do gain one huge advantage: due to the annual checkups with standardized examinations, the state collects a huge dataset of very high quality. Conclusions can be drawn from these datasets with the help of neural networks. How likely is it that someone will have a heart attack? What is the likelihood of someone developing diabetes? What is the likelihood of someone developing cancer? Thanks to the growing wealth of data and increasingly better algorithms all of this can be predicted better from year to year. And of course, the doctor receives these prognoses for the patient's yearly checkup appointment and can use them during the examinations and patient consultations. This creates a very powerful tool for the doctor, drawing his attention to potential problem areas. Far better than he could do alone, and with far less time spent per patient. This isn't just a minor improvement—this approach is a multiplier for the entire healthcare system! And we get this powerful tool only by the combination of mandatory preventive checkups and central management of healthcare.38
Even though the doctors are paid by the state, in the polyclinic they are far freer in their organization and in their decisions than would be the case for normal employees or civil servants. As previously stated, we absolutely want to avoid the state micromanaging doctors. That would lead to suboptimal treatments and demotivate them.
The state therefore does not micromanage how doctors should do their work. Instead, it pays them based on how much work they do (effort points) and how well they do it (competency assessment and patient satisfaction). Not controlled by free market pricing, but based on the comprehensive health data available to the state. It sets the framework in form of the polyclinics (6.5), but otherwise only misses the doctors' results.
Doctors are free to employ nurses, paid at fixed conditions from their own remuneration.
For those interested in the precise implementation, the box contains an explanation of the formula I propose to calculate the payment of doctors.
Doctor's salary = Effort points × Quality × Importance × Demand
The factor “Quality” is determined by the doctor's competence and the satisfaction of their patients.
Effort points: The state assigns effort points to every state-funded diagnosis and treatment. Initially only estimated, later based on the average time it took the doctors. Effort points are capped where increased time expenditure is no longer justified by a better result (⇒competence). The state has all the necessary data to statistically determine this limit.
A major advantage of setting effort points based on reported time spent is that there are no unintended biases in which treatments are prioritized.39
Importance: For particularly important or effective treatments, a value greater than 1 can be used to ensure prioritization.
Demand: With this factor the state can pay more or less for treatments by certain specialists. If there are currently too many or too few doctors in certain medical fields, the state can influence their popularity among aspiring doctors in this way.
Patient satisfaction: Citizens are encouraged to provide feedback on each of their checkups and treatments in the health app (rating them with 1–5 stars). They can change this feedback later, for example if the pain returns or a promised improvement doesn't occur. Patient satisfaction is calculated from these ratings.
Competence: To determine competence, the state randomly checks the results the doctors achieve. Partly arising from the treatment itself (Was the diagnosis correct based on the raw data? Was the treatment necessary and correctly chosen based on the diagnosis?), partially based on follow-up illnesses (A patient goes to the doctor with an illness. What prior treatments have they had, when did relevant preventive checkups take place? Does the current illness indicate that a previous treatment was unsuccessful or that something went undetected during a checkup?).
For this, the state employs specialists who are supported by AIs in analyzing the data.
If sufficiently accurate data for it is available, patient satisfaction and competence should be determined for each treatment provided by the doctor and used in their salary calculation. Then the doctor gets more money for treatments in which he or she is particularly good.