TRENDS IN PHYSICIAN SUPPLY AND DEMANDTRENDS IN PHYSICIAN SUPPLY AND DEMAND

Richard A. Cooper, M.DRichard A. Cooper, M.D..

Florida Board of GovernorsOrlando

March 17, 2004

TRENDS IN HEALTH EXPENDITURES TRENDS IN HEALTH EXPENDITURES

and theand the

DEMAND FOR ADVANCED CLINICAL SERVICESDEMAND FOR ADVANCED CLINICAL SERVICES

MACRO-FORECASTING USINGMACRO-FORECASTING USING THE TREND MODELTHE TREND MODEL

Economy Economy RelativeRelative

PopulationPopulation DemandDemand

Trends Trends ~~ FUTUREFUTURE ProductivityProductivity RelativeRelative

SubstitutionSubstitution SupplySupply

Sufficiency *

DEMANDDEMAND

SUPPLYSUPPLY

x

ECONOMIC GROWTHECONOMIC GROWTH ~ 1~ 1.0%.0%

MEDICAL CAREMEDICAL CARESPENDINGSPENDING

~ ~ 1.5%1.5%

PHYSICIANPHYSICIANSUPPLYSUPPLY ~ ~ 0.75%0.75%

HEALTH CAREHEALTH CARELABOR FORCELABOR FORCE

~ ~ 1.2%1.2%

4-5 year lag

10 year lag

ECONOMIC GROWTHECONOMIC GROWTH

SUCCESSSUCCESS

HEALTH CAREHEALTH CAREEMPLOYMENTEMPLOYMENT

TECHNOLOGYTECHNOLOGY

WORKERWORKERPRODUCTIVITYPRODUCTIVITY

POLITICSPOLITICS

HEALTH CAREERSHEALTH CAREERSEDUCATIONEDUCATION

““COMPLEX ADAPTIVE SYSTEMCOMPLEX ADAPTIVE SYSTEM””

PHYSICIANPHYSICIANSUPPLYSUPPLY

ETHNICITYETHNICITY

AGINGAGING

SOCIAL POLICYSOCIAL POLICY

MEDICAL CAREMEDICAL CARESPENDINGSPENDING

RESEARCHRESEARCHNIH NIH $27B $27B

EMPLOYERSEMPLOYERS

PROMISEPROMISEof SUCCESSof SUCCESS

DESIRES andDESIRES andEXPECTATIONSEXPECTATIONS

VENTURE CAPITALVENTURE CAPITAL

ECONOMIC DETERMINANTS OF HEALTH CARE SPENDINGECONOMIC DETERMINANTS OF HEALTH CARE SPENDING

AND THE DEMAND FOR PHYSICIANSAND THE DEMAND FOR PHYSICIANS

InfiniteInfinitePossibilitiesPossibilities

InfiniteInfiniteDesireDesire

Financial Financial ResourcesResources

GG DD PP

ECONOMIC DETERMINANTS OF HEALTH CARE SPENDINGECONOMIC DETERMINANTS OF HEALTH CARE SPENDING

AND THE DEMAND FOR PHYSICIANSAND THE DEMAND FOR PHYSICIANS

InfiniteInfinitePossibilitiesPossibilities

InfiniteInfiniteDesireDesire

SocialSocialEquityEquity

GG DD PP

ECONOMIC CORRELATES RELATING TOECONOMIC CORRELATES RELATING TO

THE DEMAND FOR PHYSICIANSTHE DEMAND FOR PHYSICIANS

RELATIONSHIP BETWEEN PHYSICIAN SUPPLY RELATIONSHIP BETWEEN PHYSICIAN SUPPLY and GROSS DOMESTIC PRODUCT and GROSS DOMESTIC PRODUCT

1929-2000 1929-2000

100

150

200

250

300

$0 $10,000 $20,000 $30,000

GDP per Capita (1996 dollars)

Act

ive

Phy

sici

ans

per

100,

000

. o

f Pop

ulat

ion

1929

1970

1990

1945-60

2000

1980

Insufficient supply leading to

medical school expansion

in the 1970s.

= = 1.5%/capita/yr1.5%/capita/yr

1996

R2 = 0.5273

50

100

150

200

250

300

350

400

$10,000 $20,000 $30,000 $40,000State Per Capita Income (1996 $)

Phy

sici

ans

per

100,

000

. o

f P

opul

atio

n

States

Florida

STATE PER CAPITA INCOME vs. STATE PER CAPITA INCOME vs. STATE PHYSICIAN SUPPLYSTATE PHYSICIAN SUPPLY

19961996

1996

R2 = 0.5273

1970

R2 = 0.5129

50

100

150

200

250

300

350

400

$10,000 $20,000 $30,000 $40,000

State Per Capita Income (1996 $)

Phy

sici

ans

per

100,

000

.

of

Pop

ulat

ion

1996

1970

STATE PER CAPITA INCOME vs. STATE PER CAPITA INCOME vs. STATE PHYSICIAN SUPPLYSTATE PHYSICIAN SUPPLY

1970 and 19961970 and 1996

1970 data from Reinhardt, 1975

0

20

40

60

80

100

$15,000 $20,000 $25,000 $30,000 $35,000

Personal Income Per Capita

Phy

sici

ans

Per

100

,000

.

of P

opul

atio

nPHYSICIAN SPECIALTIES vs.PHYSICIAN SPECIALTIES vs.STATE PER CAPITA INCOMESTATE PER CAPITA INCOME

19951995

Medical SpecialistsMedical Specialists

Surgical SpecialistsSurgical Specialists

Family/GeneralFamily/General

PracticePractice

PER CAPITA INCOME vs PHYSICIAN SUPPLY PER CAPITA INCOME vs PHYSICIAN SUPPLY in Metropolitan Statistical Areas (MSAs)in Metropolitan Statistical Areas (MSAs)

Per Capita Income

Physicians per 100,000of Population

Active Physicians

Medical Specialists

Surgical Specialists

Family Practice

Residents includedResidents included

PER CAPITA INCOME vs PHYSICIAN SUPPLY PER CAPITA INCOME vs PHYSICIAN SUPPLY in Metropolitan Statistical Areas (MSAs)in Metropolitan Statistical Areas (MSAs)

Per Capita Income

Physicians per 100,000of Population

Active Physicians

Medical Specialists

Surgical Specialists

Family Practice

Residents includedResidents included

Miami

West Palm

TREND MODEL PROJECTIONSTREND MODEL PROJECTIONS

PHYSICIAN DEMAND TRENDPHYSICIAN DEMAND TRENDvs. GROSS DOMESTIC PRODUCT vs. GROSS DOMESTIC PRODUCT

1929-2000 and Projected to 20201929-2000 and Projected to 2020

100

150

200

250

300

350

400

$0 $10,000 $20,000 $30,000 $40,000 $50,000

GDP per Capita (1996 dollars)

Act

ive

Phy

sici

ans

per

100,

000

. o

f Pop

ulat

ion

19291929

19751975

20002000

Approx 2020Approx 2020

GDP GDP 2.0% 2.0% per capita per yearper capita per year

GDP GDP 1.0% 1.0%

Health spending Health spending ~1.5% ~1.5%

Health workforce Health workforce ~1.2% ~1.2%

Physician workforce Physician workforce ~ 0.75% ~ 0.75%

100

150

200

250

300

350

400

$0 $10,000 $20,000 $30,000 $40,000 $50,000

GDP per Capita (1996 dollars)

Act

ive

Phy

sici

ans

per

100,

000

. o

f Pop

ulat

ion

19291929

20002000Projected SupplyProjected Supply

ApproximatelyApproximately 2020 2020

PHYSICIAN DEMAND and SUPPLY PHYSICIAN DEMAND and SUPPLY vs. GROSS DOMESTIC PRODUCT vs. GROSS DOMESTIC PRODUCT 1929-2000 and Projected to ~20201929-2000 and Projected to ~2020

19801980

PHYSICIAN DEMAND and EFFECTIVE SUPPLY PHYSICIAN DEMAND and EFFECTIVE SUPPLY 1929-2000 and Projected to ~2020 1929-2000 and Projected to ~2020

100

150

200

250

300

350

400

$0 $10,000 $20,000 $30,000 $40,000 $50,000

GDP per Capita (1996 dollars)

Act

ive

Phy

sici

ans

per

100,

000

. o

f Pop

ulat

ion

19291929

20002000Projected SupplyProjected Supply

Effective SupplyEffective SupplyPhysician agePhysician age

Female physiciansFemale physicians--------------------------------------------------------

Lifestyle, EmploymentLifestyle, EmploymentNonclinical careers Nonclinical careers

Early retirementEarly retirementResident hoursResident hours

ApproximatelyApproximately 2020 2020

PHYSICIANS, NONPHYSICIAN CLINICIANS and OTHER HEALTH WORKERS

1850-2010

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

1850 1880 1910 1940 1970 2000

Hea

lth E

mpl

oym

ent

per 1

00,0

00 o

f Pop

ulat

ion

.

Managers

Technicians

Therapists

Aides

LPNs

RNs

Pharmacists

Dentists

NPCs

Physicians

Adapted from Kendix and Getzen and the Bureau of Labor Statistics

2010

Optometrists ------------------------------

Nurse Anesthetists-------------------------------

Podiatrists

SpecialtyNPs & PAs

Chiropractors

Primary Care

Nurse Practitioners-----------------------------------

Nurse-Midwives-----------------------------------

Physician Assistants

PHYSICIANS

ClinicalNurse

Specialists

NaturopathsPsychologists

Clin. Social Workers

Psychiatric Nurses

Counselors

Therapists

Acupuncturists

Pharmacists

OVERLAPPING RESPONSIBILITIES OFOVERLAPPING RESPONSIBILITIES OFPHYSICIANS AND NONPHYSICIAN CLINICIANSPHYSICIANS AND NONPHYSICIAN CLINICIANS

COMPLEX CARECOMPLEX CARE

MULTISYSTEM DISEASE CAREMULTISYSTEM DISEASE CARE

CHRONIC DISEASE MANAGEMENTCHRONIC DISEASE MANAGEMENT

MINOR and SELF-LIMITED DISORDERSMINOR and SELF-LIMITED DISORDERS

SYMPTOM CONTROLSYMPTOM CONTROL

WELLNESS CARE and PREVENTIONWELLNESS CARE and PREVENTION

COUNSELING and EDUCATIONCOUNSELING and EDUCATION

NONPHYSICIAN NONPHYSICIAN CLINICIANSCLINICIANS

PHYSICIANSPHYSICIANS

100

150

200

250

300

350

400

$0 $10,000 $20,000 $30,000 $40,000 $50,000

GDP per Capita (1996 dollars)

Act

ive

Phy

sici

ans

per

100,

000

. o

f Pop

ulat

ion

19291929

20002000

Added Added NonphysicianNonphysiciancliniciansclinicians

ApproximatelyApproximately 2020 2020

NonphysicianNonphysiciancliniciansclinicians

--------------------------------------------------------

NPs, PAs, MidwivesNPs, PAs, MidwivesPsychologists, Clinical Soc. WorkersPsychologists, Clinical Soc. Workers

Chiropractors, AcupuncturistsChiropractors, AcupuncturistsOptometrists, PodiatristsOptometrists, Podiatrists

Nurse AnesthetistsNurse Anesthetists

PHYSICIAN DEMAND and PHYSICIAN DEMAND and SUPPLY of PHYSICIANS and NPCsSUPPLY of PHYSICIANS and NPCs1929-2000 and Projected to ~2020 1929-2000 and Projected to ~2020

TREND PROJECTIONSTREND PROJECTIONS

OF THE DEMAND FOR PHYSICIANSOF THE DEMAND FOR PHYSICIANS

BUREAU OF LABOR STATISTICSBUREAU OF LABOR STATISTICS HEALTH SERVICES EMPLOYMENT HEALTH SERVICES EMPLOYMENT

2000-20152000-2015

12,000

14,000

16,000

18,000

2000 2005 2010 2015

Year

Em

ploy

men

t x1

,000

.

Trend ModelTrend Model Health Care Employment Health Care Employment

Bureau of Labor StatisticsBureau of Labor StatisticsHealth Care EmploymentHealth Care Employment

1

1.1

1.2

1.3

1.4

1.5

2000 2005 2010 2015 2020

Year

Dem

and

for

Phy

sici

ans

and

Nur

ses,

.

% o

f 200

0

HEALTH RESOURCES AND SERVICES ADMINISTRATIONHEALTH RESOURCES AND SERVICES ADMINISTRATIONDEMAND FOR NURSES DEMAND FOR NURSES

2000-20202000-2020

HRSA HRSA NursesNurses

Trend Model Trend Model PhysiciansPhysicians

100%

110%

120%

130%

140%

150%

160%

2000 2005 2010 2015

Year

Per C

apita

Exp

enditu

res

.

% o

f 2000

.HEALTH CARE FINANCING ADMINISTRATIONHEALTH CARE FINANCING ADMINISTRATION HEALTH CARE EXPENDITURES PER CAPITAHEALTH CARE EXPENDITURES PER CAPITA

2000-20132000-2013

““The lagged impact of an The lagged impact of an improving economic environment improving economic environment

(with an average lag of about (with an average lag of about three years) was the primary three years) was the primary

driver in the steady increase in driver in the steady increase in the use and intensity of personal the use and intensity of personal health care from 1999 to 2002.” health care from 1999 to 2002.”

((CMS, 2004CMS, 2004))

1996 $, percent 1996 $, percent of 2000of 2000

HCFAHCFAExpendituresExpenditures

Trend Model Trend Model ExpendituresExpenditures

VARIOUS PHYSICIAN TREND PROJECTIONSVARIOUS PHYSICIAN TREND PROJECTIONS

400,000

600,000

800,000

1,000,000

1,200,000

1980 1990 2000 2010 2020

Phys

icia

ns

.

Physician Supply

Supply projections

Salsberg (COGME) 2003

Lewin (BHPr) 2003

BLS 1982-2000

Schwartz 1988

Cooper 1994

Cooper 2002

Demand Demand TrendTrend

SupplySupply

PLANNING PARAGIGMSPLANNING PARAGIGMS

Appropriate Tasks Appropriate Tasks Visits x Visits x Time per VisitTime per Visit = FTEs Needed = FTEs Needed

Time per Doc Time per Doc

TASK AND TIME MODELSTASK AND TIME MODELS

Adjusted needs model (GMENAC)Adjusted needs model (GMENAC)= >750 diseases= >750 diseases

Demand-utilization model (BHPr)Demand-utilization model (BHPr)Demographic (age/race/gender = 36) x Insurance (3) x Demographic (age/race/gender = 36) x Insurance (3) x

Specialties (18) x NCHS Datasets (5)Specialties (18) x NCHS Datasets (5)=9,720 cells=9,720 cells

Managed care model (Weiner)Managed care model (Weiner)Count all the HMO docsCount all the HMO docs

? Missed docs, different patient characteristics ? ? Missed docs, different patient characteristics ? 40 hour doc =1.0 FTEs.40 hour doc =1.0 FTEs.

PHYSICIAN SUPPLY and DEMANDPHYSICIAN SUPPLY and DEMAND

400,000

600,000

800,000

1,000,000

1,200,000

1980 1990 2000 2010 2020

Phys

icia

ns

.

Physician Supply

Supply projections

Salsberg (COGME) 2003

BLS 1982-2000

Schwartz 1988

Cooper 1995

Cooper 2002

GMENAC 1980 (1990, 2000)

COGME 1994 (2000)

Weiner 1994 (2000, 2020)

BHPr 1995 (2000)

BHPr 1996 (2000)

Task and Time Task and Time ModelsModels

SupplySupply

Demand Demand TrendTrend

THE SHAPE OF PHYSICIAN SUPPLYTHE SHAPE OF PHYSICIAN SUPPLY

NOW AND INTO THE FUTURENOW AND INTO THE FUTURE

100

150

200

250

300

350

400

$0 $10,000 $20,000 $30,000 $40,000 $50,000

GDP per Capita (1996 dollars)

Act

ive

Phy

sici

ans

per

100,

000

. o

f Pop

ulat

ion

SupplySupply

Demand

Demand

DEFICIT WITH NO ADDITIONAL USMGs or IMGsDEFICIT WITH NO ADDITIONAL USMGs or IMGs

DeficiencyDeficiency~200,000~200,000physiciansphysicians

(~20%)(~20%)

~2020-2025~2020-2025

You are HereYou are Here

Waiting times for patientsWaiting times for patients

Salaries, bonuses for new physiciansSalaries, bonuses for new physicians

Refusal by physicians to accept Medicare patients Refusal by physicians to accept Medicare patients

Boutique (VIP) practicesBoutique (VIP) practices

Recruiters and surveysRecruiters and surveys

Resident exit surveysResident exit surveys

Federal forecastersFederal forecastersBureau of Labor StatisticsBureau of Labor StatisticsHealth Care Financing Adm. (CMS)Health Care Financing Adm. (CMS)

State medical associationsState medical associationsCalifornia, Massachusetts, Arizona, New California, Massachusetts, Arizona, New Mexico, Oregon, TexasMexico, Oregon, Texas

Medical school deansMedical school deans

INDICATIONS OF CURRENT AND IMPENDING INDICATIONS OF CURRENT AND IMPENDING PHYSICIAN SHORTAGESPHYSICIAN SHORTAGES

AnesthesiologyAnesthesiologyRadiology Radiology CardiologyCardiologyGastroenterologyGastroenterologyOrthopedicsOrthopedicsDermatologyDermatologyOncology Oncology UrologyUrologyPulmonary/Critical CarePulmonary/Critical Care

Emergency medicineEmergency medicineGeneral surgeryGeneral surgeryNeurosurgeryNeurosurgeryNeurologyNeurologyOb/GynOb/GynPediatric sub-specialtiesPediatric sub-specialtiesPsychiatry Psychiatry

… …and early signs of shortages and early signs of shortages in primary carein primary care

GREATEST CURRENT PHYSICIAN SHORTAGESGREATEST CURRENT PHYSICIAN SHORTAGES

20% of 20% of physiciansphysicians

THE IMPERATIVETHE IMPERATIVE

The conditions that have led to the current physician shortages The conditions that have led to the current physician shortages have been evolving for more than a decade.have been evolving for more than a decade.

To continue to do nothing invites public discontent To continue to do nothing invites public discontent and forces the profession of medicine to redefine itself and forces the profession of medicine to redefine itself

in ever more narrow scientific and technological spheres.in ever more narrow scientific and technological spheres.

Yet, the solutions are neither simple nor immediate.Yet, the solutions are neither simple nor immediate.

These circumstances demand consensus building These circumstances demand consensus building and thoughtful planning. and thoughtful planning.

Thank you.