Supply-demand mismatch

The Nephrology fellowship match results offer the opportunity to observe how a realtime supply-demand mismatch unfolds. By applying some economic principles to the situation, we may be able to identify solutions to balance the supply of and demand for fellowship positions. Let's give it a whirl and see what we can deduce.

The opportunity cost an applicant bears if selecting fellowship training

Every applicant bears an opportunity cost. They forgo a 6-figure salary for the duration of the fellowship. Depending on the fellowship, that cost has a horizon of 1-3 years. Even more, they must sacrifice the ability to settle down in one location and delay building roots in a community because of the duration of the training program. 

Additional components of the opportunity include any spousal career changes that are needed to fulfill the obligations of the training program, finding new childcare, schools, housing, and unwinding all of these in one's existing town/city. 

High opportunity cost = low Q_expected and high Q_current

All applicants (in)formally perform this economic assessment. In the case of Nephrology, the economic losses are high (P_current) and results in a low demand (Q_expected) of fellowship positions. Interestingly, the same high P_current results in a high number of fellowship positions (Q_current). Why does P_current have different effects on Q?

Solutions to the supply-demand mismatch

Any solution must directly impact the gap between Q_current and Q_expected. This gap needs to be narrowed in order for the mismatch to approach equilibrium (Q*). 

For the better part of a decade, the Nephrology community (individuals, organizations, societies) has developed new educational tools, opportunities, initiatives, etc. to improve Q_expected. The result of these efforts is a marketplace in which there are 2 applicants for every 3 openings.

Solutions to decrease Q_current

Focusing on the supply of fellowship positions offered annually is important. Thus far, all of the known initiatives (mentioned above) focus on demand and not supply. The national aggregate number of fellowship positions offered needs to be lowered so that the number of applicants matches more closely with the number of positions available.

Systematically lowering the total number of positions offered, as well as how those positions are allocated in each state, requires even more centralization of the fellowship programs. Currently, each program operates independently of its neighbor. Without central oversight, programs make operational decisions that, in aggregate, widen the Q_current-Q_expected gap.

Solutions to increase Q_expected = decrease P_current

Q_expected (the demand for fellowship spots) will increase if the applicant's opportunity cost (P_current) falls. First, we must ensure that all applicants know Nephrology fellowships will remain a 2-year training program. Social media discussions about increasing training to 3 years are obviously non-binding and fear-generating. The community must remind applicants that the training program is, and will remain, a 2-year program without a mandatory 3rd year component.

Next, reallocate funds from initiatives that don't directly improve the Q gap to a small stipend for each incoming fellow. Stipends can be used as an add-on benefit to a trainee's salary. They can be use to lower the economic loss that trainees realize.

Third, and equally important and controversial, is to exit the NRMP (National Residency Match Program) match. The Match process stifles recruiting innovation. In the absence of the Match, applicants will still have the same NLRB (National Labor Relations Board) protections as other professionals. If you're someon who feels the NLRB protections are insufficient, I contend the better way to increase trainee protections is to allow them to unionize. Unions, and not the NRMP, offer numerically more and durable protections for trainees. 

Innovative recruiting practices are a way to lower opportunity costs. For example. allowing consecutive week vacations lowers the cost for IMG (international medical graduates) who must travel abroad to see family back home. Offering a comp package that includes consecutive week vacations and/or culturally- or ethnically-specific holidays, among other innovative recruitment carrots, shows IMGs how fellow-focused the program is.

The single best economic cost-lowering feature of leaving the NRMP match is the ability to entertain multiple offers concurrently. Applicants would be able to use the offerings of one program as leverage to negotiate a better deal from another - a career benefit that nearly every working professional enjoys to some degree. Applicants would be able to influence their opportunity cost through negotiation - an influence that none currently have.

Fourth, improve the marketing of Nephrology to the internal medicine community. Ensure that all high-quality studies, often labeled as late-breaking abstracts (LBCTs) are automatically reviewed by Nephrology-focused scientific journals for publication. This action increases the likelihood that breakthroughs in Nephrology are disseminated by the Nephrology community itself.  Waive APCs (article processing charges) for trainees that publish in one of the many specialty-specific journals - thereby encouraging them to consider training in a welcoming disclipline. Incorporate yearly board review courses into the curriculum of all training programs, so that applicants know they will receive a high level of standardized training to prepare them for the Boards, irrespective of the program they've chosen.

Supply-demand mismatches require urgent attention. If a business, or in this case, a community, ignores the mismatch and loses focus on the gap between Q_current and Q_expected, they increase the likelihood of ineffective consumption of limited resources and a worsening mismatch. Mismatch is a self-fulfilling prophecy that needs to be cut at many points in order to restore a more optimal balance.