The robustness of the healthcare workforce€¦ · – Stable, low-risk employment in a career with other psychic benefits • Public (e.g. Title VIII) and private (e.g. J&J) efforts

1

The robustness of the healthcare workforce

David Auerbach, PhD

External Adjunct Faculty Member, Montana State University

Director of Research, Massachusetts Health Policy Commission

With help from: Peter I Buerhaus, PhD and Douglas O Staiger, PhD

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The health care workforce in 2016

Home Health and personal care aides ($22k) Nursing aides ($27k) Med asst($32k)

Physicians $220k

Pharm$122k

PT$85k

Registered Nurses ($68k)Lab Tech $51k

Lic PractNurse($44k)

Physician Assistants$101k

Nurse Practitioners$108k

Master’s/Doctoral

Associate’s /Bachelor’s

High School +

Educational level

Note: Areas are proportional to number of workers with each job title. Combined workers total ~10 million.Sources: Bureau of Labor Statistics, 2016

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The health care workforce in 2016


Physicians $220k

Pharm$122k

PT$85k





Master’s/Doctoral


High School +

Educational level


4

The base of the pyramid• Some upward mobility

– Nursing assistant RN Nurse Practitioner

• Medical assistants are taking on enhanced roles in patient care

• Home health and other aide jobs tend to be low-skill, minimum-wage, high-turnover with little mobility. From a recent Massachusetts study*:

– Agencies, on average, hired 18 workers over a three month period and lost 15 workers– Home care agencies reported a quarterly home care aide turnover rate of 16%– Nearly 90% of the agencies indicated that recruiting qualified home care aides was their top

workforce challenge– Over 47% of the aides who responded to our survey have at least one other job– 40% live in households with an annual income of less than $20,000– 48.4% were Medicaid recipients

*Home Care Aide Council, “Setting the agenda: Data-driven advocacy to address home care aide policy,” Tufts Health Plan foundation, 2018

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The center of the pyramid: RNs

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The RN workforce numbers looked healthy in 2000

-

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

2,000,000

Total Registered Nurse FTE

Total FTE

Authors’ analysis of workforce data from the Current Population Survey. FTE based on a 40-hour workweek.

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But there was a problem…

-

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

2,000,000

Total Registered Nurse FTE

<35

35-49

50+

Total FTE


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The workforce had aged dramatically in 15 years

-

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

1985 2000

37.9 42.5Year

Average age

20s

30s

40s

50s

60s

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The newer entry cohorts were smaller at every age

-

10,000

20,000

30,000

40,000

50,000

60,000

70,000

25 26 27 28 29 30 31 32Age

FTE by age for two birth cohorts

1954-56 birth cohorts

1964-66 birth cohorts


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Nursing schools saw enrollment declines

0

20000

40000

60000

80000

100000

120000

1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000

Total RN degrees awarded

Authors’ analysis of data from the Integrated Postsecondary Education Data System (IPEDS)

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When we applied a workforce supply model, projected workforce size would peak in 2010 and then decline

Buerhaus, Peter I., Douglas O. Staiger, and David I. Auerbach. "Implications of an aging registered nurse workforce." Jama 283.22 (2000): 2948-2954.

• Shortages would be as high as 500k-1m

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The shortages did not come to pass

Nursing education programs in 2002 and 2012, by typeCharacteristics 2002 2012 Percentage growth

Public 1,121 (70%) 1,343 (59%) 222 (20%)

Private not-for-profit 456 (28%) 635 (28%) 179 (39%)

Private for-profit 34 (2%) 292 (13%) 258 (759%)

Buerhaus, P., Auerbach, D., Staiger. D. (2014). The rapid growth of graduates from associate, baccalaureate and graduate programs in nursing. Nursing Economic$. 32(6), 290-295, 311.

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Students taking the NCLEX exam doubled

-

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

Number taking the NCLEX exam

Total Domestic,first-timeADN

BSN

Authors’ analysis of data from National Council of State Boards of Nursing

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As did RN graduates

Auerbach, David I., et al. "The nursing workforce in an era of health care reform." New England Journal of Medicine 368.16 (2013): 1470-1472.

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Number of RNs (FTE) under age 30

0

100,000

200,000

300,000

400,000

500,000

600,00019

7919

8019

8119

8219

8319

8419

8519

8619

8719

8819

8919

9019

9119

9219

9319

9419

9519

9619

9719

9819

9920

0020

0120

0220

0320

0420

0520

0620

0720

0820

0920

1020

1120

1220

1320

1420

1520

1620

17


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New RN cohorts (Millennials) have now far surpassed the baby boomer generation

0%20%40%60%80%

100%120%140%160%180%

1920

1923

1926

1929

1932

1935

1938

1941

1944

1947

1950

1953

1956

1959

1962

1965

1968

1971

1974

1977

1980

1983

1986

1989

1992

Likelihood of someone born in a given year to become an RN, relative to 1955 birth year

Authors’ analysis and modeling of workforce data from the Current Population Survey and the American Community Survey

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And Millennial RNs are projected to far surpass the peak numbers of baby boom RNs

0500,000

1,000,0001,500,0002,000,0002,500,000

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

2007

2009

2011

2013

2015

2017

2019

2021

2023

2025

2027

2029

Number of Registered Nurses Employed on A Full-Time Basis by Generation: Historical and Projected

baby boomers (actual) Gen X (actual) Millenials (actual)baby boomers (forecast) Gen X (forecast) Millenials (forecast)Pre-boomers (actual)

Auerbach, David I., Peter I. Buerhaus, and Douglas O. Staiger. "Millennials Almost Twice As Likely To Be Registered Nurses As Baby Boomers Were." Health Affairs 36.10 (2017)

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RN hourly earnings have been flat since 1990

$0

$5

$10

$15

$20

$25

$30

$3519

7919

8019

8119

8219

8319

8419

8519

8619

8719

8819

8919

9019

9119

9219

9319

9419

9519

9619

9719

9819

9920

0020

0120

0220

0320

0420

0520

0620

0720

0820

0920

1020

1120

1220

1320

1420

1520

16

Authors’ analysis of workforce data from the Current Population Survey

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What caused the surge?• Stagnant wages, uncertainty in other sectors increased the relative attractiveness of nursing

– Stable, low-risk employment in a career with other psychic benefits

• Public (e.g. Title VIII) and private (e.g. J&J) efforts to boost interest in nursing

• Expanded educational opportunities and pathways

• Forecasts of future shortages?

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Physicians, NPs and PAs


Physicians $220k

Pharm$122k

PT$85k





Master’s/Doctoral


High School +

Educational level


21

Physician supply has grown much more slowly than RN supply

0.0

20.0

40.0

60.0

80.0

100.0

120.0

1950 1960 1970 1980 1990 2000 2010 2015

Number of professionals per 10,000 US population

RNs Physicians PAs NPs

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Physician supply has not kept pace with health spending

1980 2015 % increase

Real health spending per capita $3,354 $9,994 198%

Health care spending as % of GDP 8.9% 17.7% 99%

RNs per capita 54.0 98.5 82%

Physicians per capita 18.6 27.9 50%

Health care spending adjusted by CPI to 2015 dollars

0%50%

100%150%200%

Real health spending percapita

Health care spending as %of GDP

RNs per capita Physicians per capita

% increase, 1980-2015

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Physician residency slots and applicants

National Residency Match Program, 2017. http://www.nrmp.org/wp-content/uploads/2017/06/Main-Match-Results-and-Data-2017.pdf

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Higher-paying specialty slots are filled by US students – others are mostly backfilled by international students

(50% of international applicants do not get any slot)

727 total slots

Orthopedic surgery (mean 2016 salary; $535,668)

13 (2%) filled by IMGs

713 (98%) filled by US med students(845 applicants)

1 (<1%) unfilled

Salary data from Doximity as reported in The Atlantic, 2015. https://www.theatlantic.com/health/archive/2015/01/physician-salaries/384846/Residency data from the national residency matching program (NMRP): http://www.nrmp.org/wp-content/uploads/2017/06/Main-Match-Results-and-Data-2017.pdf

Family medicine(mean 2016 salary; $227,541)

2,219 (66%) filled by US med students

3,356 total slots141 (4%) unfilled

996 (30%) filled by IMGs

https://www.theatlantic.com/health/archive/2015/01/physician-salaries/384846/

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Barriers to entry in the physician market• Residency is required to practice in the US

• The number of positions is jointly determined by hospitals and specialty societies (residency review committees) along with a national accrediting body

– RRCs may limit slots, acting as a guild– Minimum patient volume requirements and hospitals’ financial

interests may also limit slots

Nicholson, Sean. Barriers to entering medical specialties. No. w9649. National Bureau of Economic Research, 2003.

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States with more physicians have lower physician earnings

$100,000

$120,000

$140,000

$160,000

$180,000

$200,000

$220,000

$240,000

$260,000

$280,000

$300,000

100 150 200 250 300 350 400 450

Aver

age

phys

icia

n ea

rnin

gs

Number of physicians per capita

Active physician per capita from AAMC databook, 2010. Earnings data from American Community Survey pooled data from 2005-2016 excluding physicians earning <$10,000

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Highest physician fees in low-density areas

Highest physician fees Lowest physician fees

Metro area Relative fee Metro area Relative feeLa Crosse, WI 1.49 Baltimore, MD .73Wausau, WI 1.46 Lowell, MA .74Eau Claire, WI 1.42 Nassau-Suffolk, NY .74Madison, WI 1.41 Washington, DC .75Jonesboro, AR 1.35 Fort Lauderdale, FL .75Janesville-Beloit, WI 1.32 West Palm Beach, FL .75Great Falls, MT 1.29 Miami, FL .76Green Bay, WI 1.28 Providence, RI .76Appleton-Oshkosk, WI 1.27 Dutchess County, NY .77Racine, WI 1.24 San Francisco, CA .77

Government Accountability Office, 2005. “Federal Employees Health Benefits Program: Competition and Other Factors Linked to Wide Variationin Health Care Prices” https://www.gao.gov/assets/250/247411.pdf

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The adequacy of physician supply• It is debatable how many physicians we need

– Supply may be artificially limited, pushing up wages– But specialists would likely still be highly paid

• Nevertheless, demand for health care will continue to grow faster than physician supply

– CMS projects annual health spending growth >5%/year from 2017-2026, driven by population aging, prescription drugs

– Physician supply is projected to grow <1% per year*• We project that it will actually decline (per capita) in rural areas

AAMC, 2017. The Complexities of Physician Supply and Demand:Projections from 2015 to 2030, 2017 update.

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Other clinicians will likely fill some of the gap

• Physician assistants (PA), nurse midwives (NM), nurse practitioners (NP) and nurse anesthetists (NA)

– Typically 2-3 years educational requirements beyond baccalaureate degree (more NPs earning doctorates)

– Earnings are roughly half of physicians– Considerable overlap with physician-provided care

• AAMC ‘high’ assumptions for reduction in physician demand: anesthesiology (60%), women’s health (40%), primary care (50%), medical specialties (30%), surgery (20%), and other medical specialties (30%).

– Scope of practice authority is increasing – Education is expanding (282 NP programs in 2000; 424 in 2016)

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Most added practitioners between 2015 and 2030 will be NPs and PAs

2001

100,000 physicians

100,000 NPs

100,000 PAs

2016 2030 (proj)

Historical data based onAnalysis of survey data from theUS Census Bureau and the NationalSample Survey of RNs. Projections based on workforce supply model.Publication of results is forthcoming.

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Final thoughts

• The markets for RNs, NPs and PAs appear flexible, more than that for physicians

• Slow-growing supply of physicians and expanded insurance coverage will increase pressure on states to remove scope of practice laws

• Added cost pressures from ACOs, narrow network plans should push health care organizations to use non-physicians to meet demand

Documents

The robustness of the healthcare workforce€¦ · – Stable, low-risk employment in a career with other psychic benefits • Public (e.g. Title VIII) and private (e.g. J&J) efforts