Does the under- or overrepresentation of minority physicians across geographical areas affect the location decisions of minority physicians?

Racial diversity has recently been the topic of reports by the Sullivan Commission on Diversity in the Healthcare Workforce and the Institute of Medicine (Institute of Medicine 2004; Sullivan Commission 2004;). These reports emphasize the importance of racial/ethnic physician–patient concordance in the provision of quality patient care. Health disparities affecting minorities have been traced to many causes, including language and cultural barriers that can deter minorities from seeking care or lead to suboptimal care (Lewin-Epstein 1991; Kaiser Family Foundation 1999; Ma 1999; Morehouse Medical Treatment and Effectiveness Center 1999; Ku and Waidmann 2003; Yeo 2004;). Racial/ethnic concordance in physician–patient relationships has been shown to improve care (Gray and Stoddard 1997; Saha et al. 1999, 2003; LaVeist and Carroll 2002; LaVeist and Nuru-Jeter 2002; Cooper et al. 2003; Garcia et al. 2003; LaVeist, Nuru-Jeter, and Jones 2003). Patients tend to prefer physicians who are of their own race/ethnicity (Gray and Stoddard 1997; Saha et al. 1999; Garcia et al. 2003;), and also tend to use more health care and are less likely to postpone care when they have physicians who are of their own race/ethnicity (LaVeist, Nuru-Jeter, and Jones 2003). Race-concordant visits are longer and characterized by more positive effect (Cooper et al. 2003; Saha et al. 2003;). Patients also report higher satisfaction when they are able to choose their provider (LaVeist and Carroll 2002; LaVeist and Nuru-Jeter 2002;). Such positive relationships are more likely to occur when an area contains enough physicians of a given race/ethnicity to serve local patients who are of the corresponding race/ethnicity. Economic analysis of the physician labor market adds further evidence that racially/ethnically concordant physician–patient relationships are highly valued. Brown et al. (2007) found that earnings per hour for Hispanic and Asian physicians are higher when practicing in areas where they are more underrepresented relative to the size of the respective Hispanic and Asian populations. This suggests that patients prefer physicians with whom they have language and/or cultural concordance to such an extent that they are willing to pay more to obtain such relationships or preferentially choose health plans where there is a greater likelihood of forming such relationships (Brown et al. 2007).1 Additional research has found that physicians from groups underrepresented in the health professions are more likely to serve minority and economically disadvantaged patients (Cantor et al. 1996; Gartland et al. 2003;). It has also been found that black and Hispanic physicians practice in areas with larger black and Hispanic populations and care for more black and Hispanic patients, respectively, than other physicians (Komaromy et al. 1996). However, a nuanced understanding of racial/ethnic concordance is important. Not all patients prefer having a physician who is of their own race/ethnicity. Schnittker and Liang (2006), using nationally representative data, find that only 21.7 percent of blacks and only 26.8 percent of Hispanics prefer a physician of the same race/ethnicity and that racial/ethnic concordance promotes better encounters mainly among those who prefer concordance. This suggests that those areas where the representation of black and Hispanic physicians is the lowest may benefit the most from an improved representation of black and Hispanic physicians because such areas are the least likely to have enough black and Hispanic physicians to serve those who prefer concordance. In other words, underrepresentation per se does not imply that minorities who desire concordance are unable to find it. The critical factor is the degree of underrepresentation. An issue not hitherto discussed in the literature is whether physicians move to (or preferentially remain in) areas in which they are underrepresented. Although price signals (earnings-per-hour premiums) indicate that racial/ethnic concordance is valued (Brown et al. 2007), these signals may not be large enough to influence minority physicians' location choices. Given that other area characteristics play a role in a physician's location decision, we are interested in whether variation in the level of representation of minority physicians across geographical areas affects the location decisions of minority physicians. To determine the influence that the level of minority physician representation has on the location decisions of minority physicians, location choice is separated into a departure model (the decision to leave an area) and a destination model (the decision to go to an area) (Liaw and Ledent 1987; Frey et al. 1996; Polsky et al. 2000;). We also extend this analysis to physicians just completing residency.