Economic Evidence of a Primary Care Physician Shortage

Economic Evidence of a Primary care Physician Shortage Carol Simon, PhD, William White, PhD, Andrew Johnson, MA, Alyssa Pozniak, PhD AcademyHealth Annual Meeting June 2007 We are grateful to AHRQ, the Commonwealth Fund and the California Endowment for support Research Objectives • Concern that there is an emerging physician shortage • Researchers suggest this shortage is result of growing demand for services that is not matched by a corresponding increase in physician supply • Policy makers have already identified “shortage areas”, e.g. HRSA – These are largely defined on the basis of MDs/population – Areas where there is “evidence” of unmet needs • Do these areas exhibit characteristics of an “economic shortage area”? – This is important: if not, increasing supply possibly won’t help A shortage caused by growth in demand P S •Demand grows, from D1 to D2 •At existing price p(1) shortage develops = q’-q(1) p1 shortage D1 D2 q1 q’ Q A shortage caused by growth in demand P S Shortage put upward pressure on price, which encourages increase in S and chokes off demand, until we are at P2, Q2 BUT there are lots of reasons in Health mkts why prices don’t adjust , at least quickly D2 p2 p1 shortage D1 q1 q2 q’ Q Economic Signposts of a demand driven shortage • Queues at existing prices – providers are busy • Upward pressure on prices • Providers expand volume as prices rise • Provider profits, and often incomes, rise – Due to price and volume Empirical markers of a “shortage” • Queues at existing prices – providers are busy – Not accepting new patients – Longer wait time for visits: recommended return for chronic care is longer (asthma) • Upward pressure on prices : – Price for new patient std office visit (adj for specialty, state) • Provider profits, and often incomes, rise – Income levels and income growth over last 3 years Study Design & Population Studied • Multi-mode (mail, web) survey – link MD behavior to characteristics of practice and managed care environment – random sample of 1,600 primary care and pediatric physicians from AMA Physician Masterfile Pennsylvania, and Texas • Patient care MDs practicing in California, Georgia, Illinois, – Pediatric and minority MDs over-sampled • ~50% pediatricians, • ~15% African American and/or Hispanic – Fielded January-May 2007 – response rate > 65% • Merged ARF and census data to describe “markets” (counties) Survey Data Domains • Practice characteristics – Administrative controls – Payer types – Revenues, price for new pt visit • MD characteristics – Demographics – Income – Specialty – Hours worked/week – Size – Ownership – Use of electronic health records or other HIT • Treatment patterns for key chronic conditions (i.e., depression & asthma) – P4P  Questions and series of vignettes Are physicians in “shortage” areas capacity constrained Accept new patients? 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% all areas PC shortage hi pop growth poor areas 48 33 69 49 46 43 24 43 accept none accept some Accept all 6 7 22 8 Are incomes in shortage areas pushed higher? Adj for specialty, yrs in practice, state fixed effects 120 100 100 80 60 40 20 0 0 income income growth 103 87 79 all areas PC shortage area hi pop grwth poor areas 3 1 -20 -5 Evidence of delays in follow-up care based on pt with mild persistant asthma 35 31 30 25 20 15 10 5 0 follow-up > 4 weeks 29 23 22 all areas PC shortage area hi pop grwth poor areas Thoughts on our early findings • No systematic evidence of demand-driven shortage in HRSA defined PC shortage areas – Data suggestive of inadequate demand, not excessive demand – Need to bolster “willingness and ability to pay” for care– e.g. insurance coverage and incomes • Increasing supply could reduce financial viability of existing providers • In areas with highest population growth there is evidence of queues, longer follow-up and upward pressure on incomes and prices – Here, increasing supply might raise quantity of services available and mitigate cost increases. • Mixed results on “poor” areas. Some evidence of a “classic” shortage when look at smaller areas (ZCTA) and by specialty (GIM, not peds) Thank you Retirement plans • Plans to retire or leave practice for non-patient care in the next 3 years • All PCPs – Retire=2.1 – Leave for other job = 1.7 • PCPs in PC shortage area: – Retire = 3.7%; leave for other jobs = 1.5 • In high pop growth areas: – Retire = 1.7; leave for other job = 1.2 • In low income areas: – Retire = 1.5; leave for other work = 3.5