The number of physicians practicing in the nonmetropolitan areas of the Uni
ted States in relation to population has increased over the past true decad
es, but more slowly than the number of physicians in metropolitan counties.
During the same period, there was a growing acceptance of the perception t
hat the physician workforce in the United States exceeded the number necess
ary to meet the requirements of an efficient health care system. This has c
aused policy-makers to consider reforming the incentives for training physi
cians and restricting the entry of physicians from other countries into the
United States. The supply figures on which these assessments of oversupply
were made are based on "head counts" of the number of licensed, active phy
sicians. By using more detailed data describing the licensed practicing phy
sicians in the states of North Carolina and Washington and by using estimat
es of professional activity collected as part of the Socioeconomic Monitori
ng System of the American Medical Association, estimates of the number of f
ull-time equivalent physicians actually in practice in the two states and t
he comparative productivity of those physicians were made. Based on the sta
te-level data, the estimates of actively practicing physicians are approxim
ately 14 percent lower than the head-count number in North Carolina and, by
using a move conservative estimation method, are approaching a 10 percent
lower number than the head-count number in Washington. Using national produ
ctivity data, the effective supply of nonmetropolitan physicians appears to
have not grown significantly over the past 10 years, and for family physic
ians the supply has declined by 9 percent. These estimates of the effective
physician supply support long-held claims that rural communities continue
to experience a severe undersupply of practitioners. These results suggest
that the way in which physicians are counted needs to be re-examined, espec
ially in rural places where the ratios of providers to population are more
sensitive to small changes in supply.