We begin with a review of the inefficiency effects of a monopsony.
Monopsony power, like monopoly power, results in economic inefficiency. This is because the monopsonist avoids purchasing the last few units of a good whose value to the monopsonist is greater than their marginal cost, in order to hold down the price paid for prior units. In principle, inefficiency from monopsony can be mitigated by a well- placed legal price floor, which removes the monopsonist's power over price and eliminates its incentive to restrict the quantity it purchases. A modest price floor forces the monopsonist to take price as given and increase its purchases toward the level of competitive buyers. However, if the price floor is too high, the monopsonist will reduce its purchases -- just as competitive buyers would do in response to a price floor -- and inefficiency recurs.
With the foregoing in mind, let us consider a recent report on physician burnout.
Burnout can diminish professionalism and lessen the quality of care. At the same time, it leads doctors to reduce their hours and retire early. "We're at the cusp of reform," [the Mayo Clinic's Tait Shanafelt] said. "Precisely when we need more family and internal medicine doctors, students are more likely to enter other fields. This issue has implications for the adequacy of the physician workforce."
The way to elicit a larger supply is to increase compensation, but public policy makers and insurers have focused on reducing compensation and pushing physicians to see more patients in a day.  No doubt, somewhere there is an autistic number-cruncher spinning the increased throughput of patients as a productivity gain.
Burnout generally refers to a constellation of symptoms relating to behavior at the workplace. Symptoms include emotional fatigue, depersonalization, lost enthusiasm and a failed sense of personal accomplishment. Depersonalization -- a tendency to treat people as objects, almost as a factory worker might perceive a task to be completed - happens most commonly in individuals whose work centers on interacting with others. "We know that those professionals at highest risk include teachers, social workers, police officers, nurses and physicians,"  [Professor Shanafelt] said. Many experience feelings of burnout occasionally and to a varying degree, he said. "But when it happens a lot, there's reason for concern."
To some extent, we are observing the hell is other people phenomenon at work: it is the social service professionals who encounter people with deficient life-management skills, day after day, and that grind will tax even the most committed and idealistic among us.
When the investigators studied the results by field, they found the most symptoms in emergency room doctors, general internists, neurologists and family practitioners. "To see the family doctors and general internists with such a high level of burnout was a bit unexpected," [Prof Shanafelt] said." It's concerning, because for many folks they're the front door to the medical system."

"The prevalence of burnout is so high, there's likely a systemic cause," he suggests. "If it were just a few doctors, we might think it's just a problem with particular individuals who don't respond well to pressure or stress," he said. "But with a syndrome that's affecting nearly one out of two doctors, we need to examine the environment in which we deliver care."
Computer programmers quip, "Good. Fast. Cheap. Pick any two." The policy makers who wish to bend medicine's cost curve must contemplate the generalization.

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