The young doctor wanted to build her career in New Jersey.
Dr. Matilde Hoffman finished her residency at Livingston’s Cooperman Barnabas Medical Center in June, and the OB-GYN generalist searched for jobs in the Garden State. She wanted to stay close to her family in Summit.
But Hoffman didn’t stay. She couldn’t stay, she decided. She accepted a job 300 miles away at Boston Medical Center.
“One of the main [reasons] is definitely the salary,” the obstetrician-gynecologist said. “I definitely have noticed that the salaries are less in New Jersey.”
“It’s also the way that the state practices OB-GYN,” said Hoffman, 32.
The result is a looming shortage of OB-GYNs in New Jersey.
It’s already happening in Cape May County, where hospital obstetrical care is no longer available. In September, Cape Regional Medical Center in Middle Township — the only hospital in the county — ceased its obstetric services after struggling to hire OB-GYNs. Women will have to travel 20 or 30 miles to the nearest hospital.
“A lot of medical students and residents leave the state, and it’s a combined reason,” said Dr. Lisa Pompeo, residency program director at Rutgers New Jersey Medical School. “One is the malpractice climate. Two is the cost of living.
“And three is that you’ll get paid the same amount — and actually, you probably get paid more in Arkansas or Louisiana than you’re going to get paid in New Jersey. And your dollar will go farther in Arkansas [and] Louisiana than it’s going to go in New Jersey.”
The exodus of local OB-GYNs comes as experts have larger worries about the field. Studies predict a nationwide shortage in the near future.
A 2019 report by the American College of Obstetricians and Gynecologists projected “a shortage of up to 8,800 obstetricians and gynecologists [OB-GYNs] by 2020, and a shortfall of up to 22,000 by 2050.” In fact, half the counties in the U.S. lacked “a single OB-GYN” in 2017, ACOG estimated.
“There is going to be a huge shortage of obstetricians over the next 10 years,” said Dr. Donald Chervenak, president of the New Jersey Obstetrical and Gynecological Society, an advocacy group of about 400 specialists.
The field also includes an aging population of doctors.
“In OB-GYN, a lot of the doctors are retiring,” Chervenak said.
Although New Jersey is filled with doctors and hospitals, he fears the obstetrician specialty is thinning — with a growing number leaving the state for higher salaries and lower malpractice insurance premiums.
“There are more doctors, per se, around, but many of them are giving up obstetrics, and many of the young doctors leave the state because the salaries are lower in Jersey,” said Chervenak, who estimates 2,000 board-certified OB-GYNs work in the state.
The mean wage for OB-GYNs in the New York-Newark-Jersey City area was $274,740 in 2021, according to the U.S. Bureau of Labor Statistics. It trails metropolitan areas such as Los Angeles-Anaheim ($277,960), Minneapolis-St. Paul ($294,600), Boston-Cambridge ($303,870), Dallas-Fort Worth ($328,570) and Philadelphia-Wilmington ($357,820).
Just as pressing, New Jersey OB-GYNs paid an average annual premium of $90,749 in 2021 for medical malpractice liability insurance with coverage limits of $1 million per occurrence and an aggregate of $3 million, according to a 2022 American Medical Association analysis.
Even as the state loses OB-GYNs, demand for the specialists only rises.
The field is vast and expanding. It’s not just about delivering babies. Improvements in reproductive medicine have redefined the field. And the specialty has grown as advanced technology now allows for more complex procedures.
That means more training and career paths.
“Residency programs have to train each individual,” said Dr. Gloria Bachmann, professor of obstetrics and gynecology and associate dean for women’s health at Rutgers Robert Wood Johnson Medical School. “And it does entail a lot of supervision, and you can only have a certain number that can be adequately trained each year.”
The math doesn’t add up
Dr. Eric Elias hails from Louisiana, but considered building a career in New Jersey.
The thought didn’t last long.
He decided to return to his home state after finishing his residency in 2010 at Cooperman Barnabas Medical Center. The 45-year-old OB-GYN — who lives in Lafayette, Louisiana — said the cost of living and rampant litigation in the Garden State left him no choice but to leave.
“The cost of living in New Jersey is much higher than in Louisiana, and more importantly, the litigious society you guys have — my malpractice insurance in Louisiana this year is $48,000 a year,” Elias said in his thick Louisiana accent. “And my understanding is in New Jersey, people are paying in excess of $150,000, $160,000 a year on malpractice insurance right now.
“Man, it’s crazy,” he added. “I’m telling you, that’s the biggest threat to medicine in my opinion.”
For doctors right out of school, sunken in debt and looking to start their careers, New Jersey is a discouraging place to work.
Even physicians can struggle to make ends meet between student loan payments and six-figure insurance premiums.
“If you’re a young person who’s graduated from medical school with $250,000 worth of debt, you then lived for four years as a resident making $60,000, $70,000 a year, and now your student loans are increasing …” Pompeo said.
“And now you’re going to start your first job making $250,000, give or take, if you’re lucky — maybe even less than that? It becomes very difficult for you to have a nicer standard of living.”
And then come the expenses.
New Jersey ranks fifth in the nation in medical malpractice lawsuits, behind Indiana, New York, Pennsylvania and Illinois, according to the 2021 Medscape Malpractice Report. OB-GYNs placed fifth among 29 specialty groups that are most often sued, trailing just behind plastic surgeons, general surgeons, orthopedists and urologists.
Nearly 80% of OB-GYNs have been named in at least one malpractice claim, according to Medscape.
While the Garden State’s average insurance premium is far lower than in Miami-Dade County, Florida ($215,649) or Long Island, New York ($165,824), it’s nearly double those of the California counties of Los Angeles and Orange ($49,804), according to the report.
Malpractice lawyers will capitalize on a market, Elias said. But he noted there was a vast difference between Louisiana and the Garden State.
“In Louisiana, we have lawyers too … but they sue the oil companies down here,” he said. “In New Jersey, they don’t have the oil industry, so they sue doctors.”
In the Bayou State, physicians have more protection, Elias said. They have tort reform, which sets limits on litigation.
But in New Jersey, “from what I understand, they can go after anything — they can get after your house, your personal assets,” he said. “And so that’s something that was in the back of my mind at the time.”
After finishing his residency, Elias was also offered higher-paying jobs compared to his New Jersey colleagues.
“Right off the bat, I was offered almost double,” he said.
There are other problems. Many physicians don’t accept all patient insurance carriers and “close to 50% of the deliveries in New Jersey are Medicaid,” which typically pays less, Chervenak said.
That figure might only increase, according to a Kaiser Health News report.
The Garden State has one of the lowest Medicaid reimbursement rates in nation, according to the ACOG. Its Medicaid payment rate for the global obstetric code — the code physicians are required to bill when performing services within the federal-state program — is just 41.7% of the Medicare Physician Fee Schedule. Only Rhode Island’s rate (32.4%) is lower.
All of this comes against the backdrop of Cape May County losing its only hospital obstetrics department. Cape Regional Medical Center struggled to recruit OB-GYNs, said Susan Staeger, spokeswoman for the facility, in July when announcing the news.
She cited three reasons: few babies were born at the facility (only 259 in 2021), it had no laborist program and doctors had to be on call all the time. The decision was “very disappointing to everyone at Cape Regional Health System,” Staeger said.
Though a dearth of OB-GYNs is a nationwide issue — and shortages are particularly hard on rural areas — Chervenak said the problems in New Jersey can’t be ignored.
“What makes New Jersey a little different than Texas, Florida, or North or South Carolina? Cost of living, salary, taxes [and] med-mal,” said Chervenak, referring to medical malpractice insurance.
Not to mention obstetricians have begun to feel undervalued, he said.
“As an obstetrician, I can tell you, I feel that most people feel that it’s undervalued,” Chervenak said. “In other words, in other subspecialties, many things can be billed for that you can’t be billed for in obstetrics. But you see, the public doesn’t want to hear that.
“They just want to make sure that they’re well cared for. And the problem is, if you can’t have the doctors pay off their loans for their training, then they have to leave the state in order to be able to survive.”