Last year, CVS Health CEO Karen Lynch promised that the pharmaceutical conglomerate would begin providing physician services by the end of 2022. So far, the attempt has failed.
This is good news. In recent decades, the increased corporatization and bureaucratization of medicine has led to less personal medical care and less attentive doctors, who must, among other things, file copious amounts of paperwork for each patient. It has also put physicians in the position of serving multiple masters; they must answer both to their patients and to their corporate or hospital employers, who are often not medical professionals. Doctors today are more often subordinates (to corporate employers, administrative departments, and so forth) than they are independent professionals. All this continues profoundly to change the character of medicine.
Medical decision-making by doctors has been complicated by a range of factors. In large corporate or hospital settings, a range of interests, from efficiency to profits to data collection, can undermine the medical authority of physicians and the doctor-patient relationship. Pressures from insurance companies or HMOs can interfere with physician-prescribed courses of treatment, for example, essentially leading to medical care being “managed” by external institutions. In such cases, the underlying incentives have little to do with the best interests of patients.
A recent Barron’s report on CVS and other corporations is revealing. As Josh Nathan-Kazis notes, CVS now owns a major health insurer; the country’s largest pharmacy benefit manager; and a vast network of stores:
Today, CVS Health’s $133 billion market valuation only hints at its scale. The company owns and operates roughly 9,000 retail stores, Aetna has 24.3 million people on its insurance plans, and Caremark serves 110 million members; all told, CVS has a hand in the medical care of about a third of the American public, and that pool continues to grow: In September, the company reached an $8 billion deal to acquire Signify Health (SGFY), which assesses patients’ home health needs for insurers.
He goes on to outline CVS’s plan to become a full-service healthcare facility:
CVS has been marching toward becoming a healthcare provider for decades now. You can already get vaccines, diabetes screening, and even care for some illnesses at certain CVS stores. Those services are offered at MinuteClinics (staffed largely by nurse practitioners), which CVS acquired in 2006, and at more full-service HealthHUBs, which were launched three years ago…
“No healthcare company has ever had the collection of assets that we have,” [CEO Karen] Lynch said last year. “With that comes the ability to dramatically reshape how consumers experience healthcare.”
CVS is not alone in its plans to transform how patients—or, in Lynch’s term, “consumers”—receive medical care. In July 2022, Amazon announced a $3.9 billion deal to purchase One Medical, a membership-based primary-care organization. The insurance giant Cigna joined forces with Walgreens Boots Alliance, a holding company, on an $8.9 billion deal to create a massive doctors’ group. UnitedHealth, another of the nation’s largest insurers, has been buying up physician groups for years, while Walmart has opened nearly two dozen health centers across Florida, all located beside Walmart Supercenters.
These developments may not seem alarming on their face. But the move toward “big medicine” reflects a decades-long trend in which medicine is viewed as simply another consumer service, rather than a distinctive profession with particular ethical constraints and directives. Among these is the idea that doctors ought to work directly for patients, free from interference by corporate shareholders and other external influences.
This was encapsulated in the “corporate practice of medicine doctrine,” an ethical tenet adopted by the American Medical Association in the early 1900s. Aimed at preserving the integrity and independent judgment of the medical profession, the doctrine has informed laws and regulations in nearly every state. In the AMA’s own words (according to a 2015 issue brief), the doctrine is premised on the understanding that:
(1) allowing corporations to practice medicine or employ physicians will result in the commercialization of the practice of medicine, (2) a corporation’s obligation to its shareholders may not align with a physician’s obligation to his patients, and (3) employment of a physician by a corporation may interfere with the physician’s independent medical judgment.
These laws still exist, but they are often loosely enforced, and corporate entities are frequently given substantial carve-outs.
As a result of the slackening of this doctrine, the character of U.S. medicine has changed. In 1983, more than 75% of physicians owned their own practices; by 2018 that figure had dropped to 46%. In 2021, for the first time, fewer than half of U.S. physicians even worked in physician-owned private practices. As small doctor’s offices and even local hospitals have been subsumed into large health systems, there are fewer places to seek care, and those that are available are bureaucratic mega-facilities.
There are any number of reasons for this: For one thing, Medicare reimbursement arrangements tend to favor larger health systems, which also have more administrative resources to negotiate payment from insurers and the government. Government paperwork requirements have also become increasingly onerous, pushing doctors toward the kind of large-scale operations that can handle mass administration. These new information mandates reflect a tension between companies interested in accumulating health data, and doctors, who prefer to focus on individual needs.
As I noted in the Wall Street Journal last year, for a long time,
the AMA and other medical establishments such as the American Association of Medical Colleges quietly celebrated the turn away from small medicine. They assumed that larger, more consolidated health systems would also be more efficient. On the whole, this has not turned out to be the case. Kathleen Blake, AMA’s vice president of healthcare quality, [recently] cited studies showing that hospital acquisitions of private practices—which doubled from 2012 to 2018—have led to “modestly worse patient experiences and no significant changes in readmission or mortality rates.”
Doctors have corroborated this: in a 2018 survey by the Physicians Foundation, only 13% of doctors agreed that “hospital employment of physicians is likely to enhance quality of care and decrease costs.”
In the century following its founding in 1846, the AMA won hard-earned authority for the medical profession by carefully delineating between “regular doctors” and “quacks”; improving the standards of training and licensing requirements; and instituting a clear code of ethics for physicians. It was vitally important to the AMA that physicians avoid becoming mercenary, profiting off inferior, deceptive, or actually harmful medical advice. To elevate and sustain the standing of their profession and ultimately improve their livelihoods, AMA leaders argued, patient welfare must be the driving, if not the sole, professional goal for physicians. The corporate models looming ahead threaten to undermine that.