Unfulfilled venture promise in Israel: MedCity Morning Read, Feb. 16, 2010

Hailed a decade ago as a potential “promised land” for venture capital, Israel’s market hasn’t taken off as once expected.

Highlights of the important and the interesting from the world of health care:

Unfulfilled venture promise in Israel: Hailed a decade ago as a potential “promised land” for venture capital, Israel’s market hasn’t taken off as once expected, VentureWire reports. The reasons for Israel’s promise were numerous, including a large population of engineers, a culture that encourages risk taking, a strong base of tech startups and strong research centers. But like all other venture markets, Israel has been wounded in recent years by the Great Recession and the tech bust before that.

Last year Israeli high-tech companies raised a total of $814.9 million, 61 percent less than the $2.08 billion the year before, according to the report. California’s Norwest Venture Partners, for example, hired an executive 18 months ago to lead its Israeli dealmaking, but has made just one investment in that time. The firm cites “unattractive valuations” among Israeli companies, VentureWire reports.

New medical schools abound: Citing pent-up demand from students, nearly two dozen new medical schools may be on the verge of opening within the next few years, the New York Times reports. The surge would be an abrupt shift from recent history–during the 1980s and ’90s only one new U.S. medical school was established. The new schools are driven in part by the increasing need for health care among the aging U.S. population, and the impending retirement of as much as one-third of the nation’s physicians. Whether this expected upswing in new doctors is a good thing for the country depends on a couple of key factors–where the new doctors set up shop and what type of medicine they practice.

A number of urban and rural areas are experiencing physician shortages, which are most severe in primary care, generally the least lucrative and hence least attractive type of medicine for new physicians. If the new enrollments lead to a rise of primary care doctors in underserved areas, the new medical schools will be a welcome addition to America. If not, expect more of the usual…

“When you add more physicians to an area, they just add more services, and their salaries don’t go down anywhere near in proportion to the increased supply,” said a Dartmouth College professor-physician who has studied work force issues for 20 years. “More care may not be better, but it certainly is paid for,” he said.

Where are the pediatric specialists? We’ve heard plenty about the nursing shortage and the primary care shortage, but now get ready for the pediatric specialists shortage. It’s been attracting attention for a few years, though not to the extent of the other two. Pediatricians who specialize in neurology, development and behavioral problems, diabetes, lung disease and intestinal disorders are in the highest demand, reports. Medical experts blame a number of factors for the dearth of pediatric specialists, including: a limited number of pediatric residencies, long training for pediatric subspecialties and low reimbursement for certain types of care.

Is the AMA a “failure”? Showing his disgust for both the American Medial Association and Duke University basketball, blogger Buckeye Surgeon blasts the AMA for failing to push through a fix to the Medicare “doctor’s fee.” Buckeye Surgeon runs down a number of the AMA’s previous statements about the doctor’s fee (also known as the Standard Growth Rate) in which the group insisted a fix must be part of the federal health overhaul. Yet Congress resisted tucking a doctor’s fee fix into the health overhaul, despite the AMA’s lobbying. It’s the group’s support of the overhaul despite this perceived shortcoming in the proposal that raises Buckeye Surgeon’s anger. Ouch …

The AMA has failed miserably on all counts. It has turned itself into a pathetic, insular, completely impotent organization that, given its historical legacy and universal “name recognition,” functions as a mere prop for for any reform bill that does come out of Congress.

Photo from flickr user RonAlmog