For the second time in four years, a jury has handed a Boise, ID radiologists' group a multimillion-dollar award in its suit against one-time partner Saint Alphonsus Regional Medical Center.
The complaint by MRI Associates alleged that Saint Alphonsus conspired with a rival imaging group to steer business away from MRI Associates, even though it was partners with the hospital.
Last week, a 12-member jury needed only one day of deliberations after an eight-week trial before it awarded MRI Associates $52 million, which plaintiffs' attorney Wade Woodard says represents the value of the income lost when Saint Alphonsus drove business to rival startup Intermountain Medical Imaging.
"This case was all about money, profits," Wade Woodard, a principal Banducci Woodard Schwartzman PLLC, a Boise-based litigation law firm, told HealthLeaders Media. "Saint Alphonsus went from having about a 27% interest in all the MRI scans that were done to a 50% interest."
MRI Associates was founded in 1985 as a partnership among physicians, radiologists, and several hospitals, including Saint Alphonsus. In about 2000, however, radiologists at the hospital started their own practice, Intermountain Medical Imaging.
Woodard says Saint Alphonsus took an active role in establishing Intermountain and worked to drive business toward the rival practice, even as it was in an active partnership with MRI Associates. Woodard says the hospital acted in bad faith and reneged on a no-compete promise with MRI Associates, which he says has lost about $25 million in value since 2005.
"St. Al's, while it was in a partnership, competed against that partnership. That is against the law. The jury saw that," Woodard says. "St. Al's should have told the radiologists 'whatever you guys do, we are sticking by our partners.'"
In 2007, during the first trial, a jury awarded MRI Associates $63.5 million – the largest jury award in Idaho history. However, that award was reduced by a judge to $36 million, and the verdict was reversed by the state supreme court and sent back to the lower court for retrial.
Last week's $52 million award represents the second-largest jury award in Idaho history.
Woodard says he anticipates that Saint Alphonsus – which is affiliated with Trinity Health – will appeal the latest verdict as well. "We are hopeful that it will stand up. The judge ran a clean trial and there is no reason why it shouldn't stand up on appeal," he says.
Elizabeth C. Duncan, director of public relations for Saint Alphonsus, said in an email response to HealthLeaders Media that the health system is considering its options.
"Saint Alphonsus is studying our grounds for appeal of the jury verdict and believes that there are a number of substantial issues for consideration by the Idaho Supreme Court," she says. "The timing and amount of any payment by Saint Alphonsus will depend on the outcome of the appellate process and any further proceedings, which at a minimum would take many months."
"Saint Alphonsus mission of providing superior quality care to serve the community is at the forefront of every decision it makes, including those made in connection with this matter. Saint Alphonsus declines further comment at this time, as the matter remains in active litigation.
Woodard says the suit should serve as a cautionary tale to other hospitals. "If you're in a partnership, be true to that partnership," he said.
Last week, I cited a new study suggesting that high employee turnover in hospitals could be linked to low funding of healthcare human resources departments, as compared with industry averages.
It was a fair critique, and there has been lots of commentary of late about the need for hospitals to improve retention, especially among younger nurses.
On a related issue, however, many hospitals do exceedingly well: retaining older workers. That point was brought home in an AARP report in September that placed 18 hospitals among the nation's Top 50 "Best Employers for Workers Over 50."
It shouldn't be surprising that hospitals dominate the list. Some professions—such as journalism—regard older workers as expensive, hidebound, and slow-moving wildebeests that are easy pickings for layoffs when they begin to straggle behind the herd.
Hospital HR leaders, however, recognize the value of their senior staffers, who carry in their skulls a lifetime of institutional wisdom and real-life experience. Hospital HR leaders also understand the skyrocketing costs of recruiting and retaining older staffers' replacements when a nationwide workforce shortage means qualified candidates are holding most of the cards.
I spoke with HR executives at two health systems that made the AARP list: Bonnie Shelor, senior vice president of human resources at Richmond, VA–based Bon Secours Richmond Health System; and Sid Seligman, senior vice president for HR at West Orange, NJ–based Saint Barnabas Health Care System. When it comes to retaining older staff, Shelor and Seligman are singing in the same choir.
"We put a premium on older employees," Shelor says. "In our organization we greatly value the kind of knowledge and experience and intellectual capital and wisdom that the older worker brings to us. You just can't replicate it. We see the older worker is a great mentor/guide/coach for the younger worker. A pairing of those two is the best of all worlds."
Seligman says: "We look at the needs of all of our demographic, especially staff over 50, because we are heading to an organization with an average age in that area, around 47 years old. We want them to believe that if our leaders are attuned to the needs of their staff and support them adequately, the staff, in turn, will be engaged in the mission as we like to see it executed."
Let's concede that the stalled economy has played a role in lower turnover of senior staff at many hospitals. Bluntly stated, many people can no longer afford to retire, or they may be supporting a family member who's lost a job.
But that isn't the only explanation. Seligman and Shelor say hospitals do a better job retaining senior staff because hospitals have been practicing for longer than most other industries. And one of the first things they recognized that seniors want is flexible scheduling. "Healthcare lends itself to flexibility," Shelor says.
"We are open 24/7 and there are many different roles for healthcare workers, nurses in particular. It is not a cookie cutter job."
Shelor says Bon Secours designs career paths for its staff that will allow them to remain working for the health system for their entire career. "When nurses come into our organization, if they come in right out of school, what we tell them is they can have a job with us for life through the many stages of their own lives," she says.
"That would be as a young person, a young mother, a mother of teenagers, as a daughter of aging parents. The needs of workers change in their lifespan, and healthcare is uniquely designed to respond to those needs because of the 24/7 platform and the ability to be flexible."
Both Saint Barnabas and Bon Secours also allow senior staff to keep their health insurance plans even as they reduce hours. "We offer a program where people can work part-time, get full-time benefits, and when the census spikes they are the first people we go to put in additional hours. It's a way for people to phase into retirement," Seligman says.
As workers grow older, Seligman says, the physical demands of the job become even more challenging. Nurses are sometimes on their feet for 12 hours. "The desire to retire is there, although the fear that one is unable to retire is there and we try to deal with those concerns as well with financial planning," he says.
Every day about 10,000 baby boomers turn 65. What does that portend for the future of the workforce across all industries? We often hear about what healthcare HR can learn from other industries. When the topic is retaining older workers, however, Shelor says other industries need to learn from healthcare HR.
"Healthcare HR was on the forefront because of a definitive need early, and that is the shortage of nurses. But every industry needs to take advantage and promote and support older workers," she says.
"Other industries, if they have not, need to wake up and realize that they have to respond with flexibility to the needs of the older workers," Shelor says. "Not only are they able to keep workers in the workforce and reduce their vacancy rate, also, they get the advantage of the wisdom and history that older workers have."
Healthcare created 11,600 jobs in October—a significant drop from the 45,000 jobs created by the sector in September.
However, even with the decline, healthcare remains a leading source of job creation in the overall economy, and was responsible for 15% of the 80,000 new jobs across all sectors in October, new data from the Bureau of Labor Statistics show.
Through the first 10 months of 2011, healthcare created 266,000 jobs—more than the 263,400 healthcare jobs created in all of 2010. Healthcare is on a pace to create 319,000 new jobs by year's end. So far this year, the 266,000 new healthcare jobs represent 22% of the more than 1.2 million non-farm jobs created in 2011.
While the job growth is heartening within the healthcare sector, and it is providing some short-term good news for an otherwise dire job market, some observers say it's not necessary a healthy trend.
"It's probably a bad thing. It's definitely not sustainable for the long term," says healthcare economist Jason Shafrin. "Let's say that healthcare worked perfectly and you could cure someone with one pill that cost $1. That would be a very efficient use of healthcare and people would spend all their money and effort on things that would be more useful."
Healthcare in America is highly inefficient and expensive, however. "It's providing a service that is needed, but it is not so clear that an increase in spending is good," Shafrin says. "It does employ people. But in bad neighborhoods they employ a lot of police, and you would prefer not to have that."
Labor represents about 60% of healthcare costs, and the salaries paid to healthcare workers take money from other areas of the economy. At some point, the demand for new healthcare workers will collide with consumers' inability to pay for care, Shafrin says. "Something will have to happen. The cost pressures are too strong. It's like the housing sector. You can see it growing and growing and growing and eventually there has to be a self-correction."
The 70,100 new hospital jobs so far in 2011 are nearly three times more than the 23,400 new hospital jobs reported in the first 10 months of 2010. However, this year's explosive growth tapered somewhat in October with hospitals reporting 3,300 new jobs, a significant drop from the 13,300 new hospital jobs in September, BLS data show.
Ambulatory services—which in recent years have been the biggest job-growth source in the overall economy—also saw a significant slowdown in October. This sector, which includes physicians' offices, created 4,800 new jobs in October after reporting 26,000 new jobs in September and 18,100 new jobs in August. Ambulatory services have been responsible for 58% (155,200) of new jobs in healthcare so far in 2011. In the first 10 months of 2010, ambulatory services created 148,200 new jobs.
Physicians' offices alone have created 62,000 new jobs in the first 10 months of 2011, compared with 25,300 jobs created in that subsector for all of 2010. Physicians' offices created 8,200 jobs in October, after posting 12,200 new jobs in September. Physicians' offices created 23,100 new jobs in the first 10 months of 2010.
BLS data from September and October are preliminary and may be revised considerably in the coming months.
More than 14.1 million people worked in the healthcare sector in October, with more than 4.7 million of those jobs at hospitals, and more than 6.2 million jobs in ambulatory services, which includes more than 2.3 million jobs in physicians' offices.
In the larger economy, nonfarm job growth was up slightly in October, with 80,000 payroll additions reported. Overall, the nation's unemployment rate remained unchanged at 9%—its level since April—with 14 million people unemployed. The number of long-term unemployed, defined as people jobless for 27 weeks or longer, was 5.9 million in October, down from 6.3 million in September, and represented 42.4% of the unemployed.
After a decade of documenting, Highmark, one of the nation's largest Blue Cross and Blue Shield affiliates, says physicians and hospitals in its Quality BLUEpay-for-performance initiatives consistently outperform providers who are not part of the program.
In its annual report for fiscal 2011, Highmark says Quality BLUE has used financial incentives to lower healthcare-acquired infection rates—saving hundreds of lives and tens of millions of dollars—and improve screening rates and overall patient safety. The quality measures continue to improve even as the program has grown to include 1.7 million Highmark members, 81 hospitals, and 1,600 practices in 49 counties in central and western Pennsylvania.
Deb Donovan, director of provider performance and strategy at Pittsburgh-based Highmark, told HealthLeaders Media that the secret to the PFP model is simple.
"Frankly, it is skin in the game," Donovan says. "The hospitals place a portion of their contracted reimbursement at risk on performance in the program, and there is enough money at risk for the organization that it gains the C-suite's attention. It quickly galvanizes the organization around aligned goals and helps drive clinical improvements."
Donovan points to several key metrics in 2011 for both hospital and physician PFP programs:
Well-child visits in the first 15 months of life exceeded the national average by 15% and well visits for children, ages 3-6, exceeded the national average by 13%.
76% of women in the program who were between ages 42 and 69 got mammography screenings for breast cancer in the past two years—9% higher than the national average.
72% of office-based physicians in Quality BLUE use electronic prescribing compared to only 36% nationally.
An estimated 351 cases of MRSA with a care cost savings of $9.5 million to $12.2 million were eliminated in the past four years.
An estimated 1,535 central line associated bloodstream infections with care costs savings of $11.2 million to $44.8 million were eliminated in the last five years, saving potentially 184-384 lives.
Donovan says the improvements are particularly impressive because Quality BLUE constantly monitors and improves its own standards. "The program is modified each year to increase the rigor. We raise the bar each year and the facilities continue to be challenged and work hard to achieve the outcomes," she says.
Even patients who aren't in the PFP program are enjoying the benefits of the enhanced quality at participating hospitals, Donovan says. "When we operationalize the program, it applies to any patient who crosses the threshold of a facility's door."
"It is Highmark's program that is really creating the infrastructure requirement and changes in the institutions. That change is applicable whether it is a standard Medicare patient or another health insurer. They are receiving the benefit of the changes that the Quality Blue program helps drive within the institution," she says.
Because the program is adjusted annually, providers are required to implement the newest strategies quickly to improve and measure outcomes in a well-defined way. "That way we can look at that consistent measure across all facilities, and then compare ourselves to external benchmarks," Donovan says.
Highmark's next move with Quality Blue will be to take the lessons learned in the PFP program and apply them to other care delivery models, including a newly launched patient-centered medical home pilot serving Pennsylvania and West Virginia. "We are continuing to look at how do we advance value-based models that will improve the care that is being rendered to our members and ultimately bend the cost trend," she says. "If we can't bend the trend, then it is not going to be sustainable in the long term."
Vermont's yet-to-be-defined leap into state-sponsored universal healthcare could cost as much as $9.5 billion by 2020, about double the $4.7 billion the state now spends on healthcare. That's roughly $14,000 for every person in the state.
But the state plan will still cost less than maintaining the current system of private plans, which could add an additional $550 million to $1.8 billion to the cost of healthcare in the state, according to new estimates released this week.
Whatever plan emerges will at best only slow the 7% annual increases in healthcare costs that are projected until 2020 under the status quo. Vermont, with an aging population and already aggressive coverage for the poor and under-insured, has seen some of the fastest growth in healthcare costs of any state in the nation. In 1992, healthcare represented 10% of the Vermont economy. In 2009, it represented nearly 19% of the state's economy.
"Achieving savings in healthcare spending is a difficult process. In this context, success is measured as reduction in the rate of growth—achieving absolute savings (spending less than in the prior year) is extremely unlikely," according to the report.
Although cost savings are a key component of the plan, the report cautioned that money should not be the only factor when measuring success. "Ultimately, accomplishments will be measured against several standards, including the health of the population, satisfaction of both providers and patients, and the financial sustainability of the system."
Nonetheless, the report said more precise estimates of any projected savings for state-sponsored universal care could be difficult right now because nobody really knows what the plan will look like.
"The actual savings will be determined by decisions yet to be made by the Green Mountain Care Board, the executive branch, and the general assembly, as well as the impact of national initiatives and policy changes, including the amount of federal financial support that we can anticipate," the report's authors wrote.
That savings would be dependent, for example, on cost-containment measures that include payment reform, delivery system changes, and reductions in provider costs—particularly simplifying administrative and paperwork costs that are now associated with private health plans.
If the healthcare system takes action on those and other cost-cutting measures, savings will begin in 2014 and "rise rapidly for the next several years," according to the report.
That savings will also require "substantial investments" in the program's infrastructure, which could cost between $50 million and $150 million.
The American Hospital Association and two hospital group purchasing organizations say they support President Barack Obama's executive order this week to reduce the nation's prescription drug shortage.
Steven Lucio, director for clinical pharmacy solutions at Novation, told HealthLeaders Media that the federal government really can't go much beyond the president's order. "This is a free market and that is what we have to understand. The government can't force drug companies to make products. Unless we want to change that -- and there is a lot of sensitivity these days about what it is practical for the government to do -- I don't think it can be done and I don't think it is appropriate."
Lucio says that the Food and Drug Administration now has only about four people in its drug shortage division monitoring anything from 178 to 211 drug shortages."Four people can't manage that," he said.
While there have been calls to ease restrictions on importing prescription drugs that are in short supply, Lucio says that probably wouldn't work all that well. "The problem is you can't find it," he said.
"If there is a product to be found they will go and try to get it. It's just [that] we can't take all the medication from Europe. However, if the FDA has greater notifications maybe they can do something with a foreign government that would have more time to respond. "
The executive order calls on the FDA to:
Press drug manufacturers to report as far in advance as possible on the potential shortages or discontinued product;
Expedite regulatory review of drugs; and
Review "certain behaviors" by market participants that could include hoarding drugs and reselling them at exorbitant prices
"The shortage of prescription drugs drives up costs, leaves consumers vulnerable to price gouging and threatens our health and safety," Obama said Monday in prepared remarks. "This is a problem we can't wait to fix. That's why today, I am directing my administration to take steps to protect consumers from drug shortages, and I'm committed to working with Congress and industry to keep tackling this problem going forward."
Blair Childs, senior vice president of Public Affairs at Premier healthcare group purchasing organization says that providers shouldn't wait on the government to supply all the answers to the drug shortage problem.
"There are things the government can do that are positive, but there are things we need to do in the private sector," he said. "We need to work with manufacturers and distributors to manage or mitigate the disruptions that occur in the market. How do we help ensure that the products are shared broadly and allocated effectively, that there is a heads up so that folks are preparing when there is an impending shortage. Those are the things we talk to distributors about."
Childs believes that much of the president executive order will do little if anything to solve the short-term shortage of prescription drugs. "But it will help reduced the problems in the longer term. The ultimate long term solution is they need to speed approval at FDA and also for both the new generic products and the active pharmaceutical ingredients," he said.
AHA Executive Vice President Rick Pollack said in a prepared statement that the order "comes at a critical time and is welcome news for hospitals and the patients they care for. The number of drug shortages has tripled in the last six years and the shortages are affecting patient care."
An AHA survey this year found that nearly 100% of hospitals reported a shortage in the past six months, but that most of them rarely -- if ever -- received advance notification of these drug shortages.
"Clinicians need more notice from drug manufacturers so they have time to act to ensure that patient care is not disrupted," Pollack said. "Hospitals are doing their best to reduce the impact of shortages by increasing inventories, buying alternative drugs and training clinical staff on how to deal with drug shortages."
While AHA supports the president's order, Pollack says Congress must step up to pass bipartisan legislation that requires drug companies to tell the FDA as soon as possible of interruptions in supply or discontinuations.
"In addition, we believe that obstacles must be removed so that FDA is able to streamline approval of drugs in shortage," Pollack said.
Online advertised vacancies for healthcare practitioners and technical occupations fell by 25,000 listings in October, snapping what had been two consecutive months of impressive gains for the sector, the Conference Board reports.
Healthcare practitioners and technicians—with 506,000 online job listings—posted the largest declines in online advertised vacancies among the top 10 occupation groups in the overall economy.
There were 17,900 and 26,300 new online job listings for healthcare practitioners and technicians in September and August, respectively, following a decrease of 61,200 listings in July.
The drop in job postings for healthcare practitioners was largely fueled by decreased ads for registered nurses and family and general practitioners. However, the number of advertised vacancies for these highly skilled medical professionals continues to outnumber job-seekers by 2.6 to one, with an average hourly wage of $34.27, according to The Conference Board Help Wanted Online report, which tracks more than 1,000 online job boards across the United States.
Healthcare support positions fell by 1,700 listings to 114,100 in October. There were 2.6 healthcare support job seekers for every job opening, and the positions paid$12.94 an hour, on average, the Conference Board reported.
In the overall economy, online job listings fell by 13,600 posts in October to about 3.9 million, after losing 44,000 job listings in September, 164,000 listings in August, 217,000 listings in July, and 100,000 listings in June. Nationally there were 10 million more unemployed people than job listings, or 3.5 unemployed people for every online advertised job vacancy.
“The good news is that labor demand did not deteriorate further in October, but at the same time we have no clear sign that demand is picking up,” said June Shelp, vice president at the Conference Board, in a media release.
The drop in demand of 513,000 job listings over the last seven months has largely offset the gain of 763,000 listings in early 2011, Shelp said, and narrowed the average monthly gain for 2011 to 25,000 job listings.
There is not much good news in a report from PricewaterhouseCoopers Saratoga that reviews the state of personnel departments at health systems nationwide.
Annual turnover – both voluntary and involuntary – at the 50 hospitals represented in the report dropped from 33.5% in 2008 to 26.2% in 2010, compared with 22.7% annual turnover for all industries in 2010. PwC Saratoga's Shebani Patel, the author of the report, credits much if not all of that decline in turnover to a weak economy and a bunker mentality that most workers in all sectors have adopted in a stagnant economy.
"It's not that all of a sudden the on-boarding and acquisition and assimilation process has become solid. It's that individuals are just happy to have a job," Patel tells HealthLeaders Media.
What is striking, however, is the report's notion that hospital HR departments spent an average of $701 per employee in 2010, while the industry average was $1,495. In addition, there were approximately 148 employees for every HR employee at hospitals, while the industry average was 91 employees per HR employee.
So, hospitals have higher turnover than most industries and hospitals underfund and understaff their HR departments compared with other industries. Is there a correlation?
"What we can say is the money that is invested in hospital HR tends to be more focused on the basics: getting people hired, benefits, and getting paid," Patel says. "Financial services or technology might focus on more strategic issues such as talent management, succession planning, leadership development, predictive analytics, how to use analytics to manage the workforce, how do we pay for performance, how do we identify and differentiate our high performers versus the overall population."
Strategic thinking takes data and other resources, and that requires money.
"When you don't have the budget, you don't have the resources to dedicate to that," Patel says. "That is not to say that is the way it is at all hospitals. Some hospitals are very effective in outsourcing more of the administrative components so that the dollars remaining are spent on more strategic elements. But the reality is that most are not there."
It is possible that some of hospital HR costs are hidden in what Patel calls "shadow HR spend" on services that might be performed by nurse supervisors and mentors during the on-boarding process. "Some hospitals have a particular function that focuses on retention. That may or may not fit within HR," she says. "The question becomes, is there cross collaboration so that the organization is effective in managing the workforce? I have clients who say every hospital in their system can do whatever they want for anything HR oriented. That creates a lot of fragmentation and redundancy and expense, where if certain things were centralized that could help the organization."
As the economy rebounds – however slowly – many workers will look elsewhere for new opportunities. Patel says there is already some evidence of that. "That's especially true for what we would consider pivotal roles that are absolutely critical to keeping the doors open, and also with high performers," she says. "People are still a bit uncomfortable about testing the waters and seeing what is out there but if you know you are good or you know you are in a role that is in high demand, you are more willing to look at what is out there."
Hospitals should not accept turnover as inevitable. "If you start to see this as part of the business cycle and expect that this is what it is, then that creates a problem because everyone just accepts it for what it is and nobody places attention on it," Patel says.
Patel says "a big missing component" for many people in hospital HR is their lack of experience with analytics and their discomfort with using data to help drive labor force decisions.
"We have a lot of individuals who are not, um, how do you say this? The business acumen isn't necessarily as strong," she says. "So traditionally it has been about 'how do we have happy employees? We are the people pleasers!' and less about 'how do we manage labor costs so we are delivering the highest return on workforce development?'"
That needs to change as hospitals look to contain labor costs and recruit and retain the best employees in a fiercely competitive environment, all within a limited budget. "HR is evolving into 'we want to operate like a business. We are here to manage the human capital of the organization and that requires operations and being comfortable with finances," Patel says. "Traditionally it has been the place that hears complaints. I hate it when I hear, 'I work in HR because I like people.' That drives me nuts."|
"Leverage data that HR might collect on exit and on-boarding with those that are handling retention programs to make sure they are effective," she says. "Look at systems with the technology that supports HR to make sure they can develop a workforce analytics capability."
Projecting future healthcare workforce demand is a backward-looking process that doesn't account for new technologies and other changes that greatly impact labor forecasts, according to a study from the Bipartisan Policy Center's Health Professional Workforce Initiative.
"It's a pretty simple formula. You take population growth times aging times prevalence of disease. How may are diabetic? How many have heart disease? Then we figure based on history that we need 2.2 visits per primary care doctor per year per capita. Then we add those up and come up to a shortage of 28,000 to 91,000 doctors."
New and immediate technologies that could greatly reduce in-person visits to the doctors' offices are not factored into this equation. "That assumes that all of those 2.2 visits were necessary and there were no other options that were either more attractive or affordable to consumers, like an e-visit," Keckley says.
"About 40% of visits to primary care physicians do not require physical examinations. You don't need to go to a doctor's office to get a script refilled, so we shouldn't be calculating the number of visits to doctors historically as the basis for determining how many we are going to need in the future when we have technologies that will replace some of that demand," he explains.
Improving healthcare workforce planning and development is a critical component of the Accountable Care Act, and Keckley says it's needed because labor costs are a huge driver of healthcare inflation.
One out of three respondents in the HealthLeaders Industry 2011 Survey cited labor costs as the top driver healthcare costs.
"The simple reason is that with 60% of the healthcare spend on payroll, compensation, labor costs, and with healthcare growing at 6% a year, you have to find better ways of reducing costs and the single biggest factor in healthcare is labor," he says.
"We have to find different ways to organized and train the workforce. We have to leverage technology to do things that technology does that today people might be doing. We have to recognize that the system, its incentives, its regulatory framework, the information we now have tells us there are better ways of doing things than having people show up in doctors' offices or have tests or procedures. The future is not a repeat of the past."
While identifying the problem may be relatively easy, Keckley says that fixing it could prove nettlesome. "Each profession has developed over the years its own methodology for determining supply and calculating demand," he explains. "Unfortunately those are not consistent across the professions. So we are finding it challenging to arrive at a common methodology for calculating demand."
Keckley adds that one of the biggest roadblocks toward determining healthcare workforce supply and demand may be the physicians themselves. He notes the dust up that ensued earlier this month after studies suggested that many prostate cancer screenings were not cost effective. "We have to get down to what is evidence-based and we need to build demand based on the evidence of what works instead of on what doctors say the evidence says. That is huge. That is a big deal," he says.
Organizations such as the Association of American Medical Colleges are already on board with the idea of healthcare workforce planning by exploring new concepts like team-based healthcare delivery and the use of technology and hard data. "Academic medicine seems to be already aligning its training programs with this new normal," Keckley says.
For any sort of workforce coordination and development to take hold, Keckley says, they will need the input and support of major medical trade groups. In addition, he says, any workforce development guidelines that develop should not be presented to healthcare providers as government mandates. "It has to become a set of tools, rather than rules. You can't regulate a workforce. You have to create tools so that market migrates to that model," he says.
He says that may prove to be a tough sell for many practicing physicians. "This is not being accepted quite as well is in Anytown, USA, where every one of these guilds likes to make its own rules and have no one else be a part of that discussion," he says. "How many doctors do you need on the staff at Anytown USA Community Hospital? Well, the medical staff wants to vote on that. They don't want to base that decision on input from anyone but the medical staff. So, if the government was to set out standards for the right demand of the workforce in your market and it was inconsistent with what a group of doctors said they wanted you'll have tension."
Earlier this month, senior leaders in the American Hospital Association descended on Capitol Hill to do their job -- lobby Congress to protect hospital funding from budget cuts.
Unfortunately, the hospital executives made a tactical error when they suggested that raising the Medicare eligibility age would be preferable to foisting more reimbursement cuts on hospitals.
That idea, one of 40 or so alternatives proffered by the hospitals, did not originate with AHA. That didn't matter. As soon as AHA aired it, they owned it.
Critics didn't see the three dozen or so other suggestions. The fact that the nation's hospitals would endorse cutting services for the elderly in the name of "shared sacrifice" and as an alternative to their own budget cuts immediately created bad will and adversaries both within Congress, and the public.
Stung by the backlash, the AHA now is pursuing a different, smarter tack.
In an Oct. 17 joint letter to the 12 members of the Joint Select Committee on Deficit Reduction Congressional – aka the "Super Committee" – AHA President Rich Umbdenstock, AHA Chairman John W. Bluford, American Nurses Association President Karen Daley, and CEO Marla Weston played up the financial stability that the nation's 5,000 or so hospitals provide in their communities. The two trade groups then warned the Super Committee that any significant cuts to Medicare or Medicaid "could create devastating job losses in our communities."
"While we recognize the serious fiscal pressures facing our nation, we feel it is counterproductive to target hospitals and the healthcare field for significant spending reductions at a time when we are providing economic stability and job growth in a sluggish economy," the ANA/AHA letter said.
This is a great tactic for several reasons –the best reason of which is that it's true. Now, instead of throwing other healthcare constituencies under the budget cut express, AHA/ANA are making a strong case for why they should be left unharmed.
And the fact is, the healthcare sector is an incredible job-creating machine. Any town with a doctor's office, a critical-access hospital, or a level-3 trauma center has a stake in this game. AHA and ANA are wise to bring this to the attention of lawmakers, all of whom have any number of respected and influential healthcare providers in their districts who will be hurt by Medicaid or Medicare cuts.
A little perspective: President Obama went to Detroit last week to tout the auto industry bailout, which by some estimates saved about 1 million jobs. Hospitals employ 5.4 million people. The healthcare sector employs more than 14 million people. That does not include the millions of "ripple effect" workers whose jobs are affected by the healthcare sector.
As I wrote earlier this month, U.S. Bureau of Labor Statistics data show that healthcare is creating jobs at a pace not seen in four years and is responsible for nearly one in four new jobs in the overall economy so far in 2011, and is on a pace to create 344,000 new jobs by year's end.
In September, I noted, healthcare employment rose by 43,800 jobs, representing roughly 42% of the 103,000 payroll additions in the overall economy. The 258,000 new healthcare jobs represent 24% of the slightly more than 1 million non-farm jobs created in 2011.
The case for healthcare job creation gets stronger if you consider that much of the September growth outside of healthcare was credited to the end of a two-week strike in August affecting about 45,000 telecommunications workers at Verizon. If those returning Verizon workers were factored out of the September growth, then healthcare would be responsible for 75% of the 58,000 new jobs in the economy for the month.
Those are jobs -- and voters -- in 50 states, in every city, in every town. With an election year looming, and at a when Republicans and Democrats say they are making job creation a top priority, AHA/ANA is making sure these lawmakers – and the public -- understand who is creating the jobs, and why their success shouldn't be messed with.
The AHA has estimated that the 2% reduction in Medicare payments that would be imposed automatically on Jan. 1, 2012 if the Super Committee can't come up with mandated budget cuts would cost hospitals about $41 billion through 2021. With labor consuming more than two-thirds of hospital spending, AHA says its calculations show that Medicare cuts would cost nearly 200,000 hospital jobs over the next decade.
You can argue whether or not the growth in healthcare sector jobs is good for everyone outside of healthcare. That job growth, after all, plays a part in fueling the nation's runaway and unsustainable healthcare expenditures, which now account for about 18% of gross domestic product.
That is a legitimate argument. But that is policy. This is politics. This is about defending your turf. This is about protecting your interests. It's a fight that hospitals and nurses can take to every home district in Congress. It's smart.
