No end in sight for physician shortage
New studies predict a growing shortage of physicians in the U.S. This is a crucial issue for hospitals because healthcare reform will increase the number of people with health insurance coverage, creating more demand for physicians.
Projected demand: A new study published in the Annals of Family Medicine projects the number of primary care physicians needed in the U.S. in the wake of the Affordable Care Act. The total number of office visits to primary care physicians is projected to increase from 462 million in 2008 to 565 million in 2025. That will require nearly 52,000 additional primary care physicians by 2025.
The key drivers are population growth, aging, and insurance expansion due to healthcare reform. The study determined that population growth will be the largest driver, accounting for 33,000 additional physicians, while 10,000 additional physicians will be needed to accommodate population aging. Insurance expansion will require more than 8,000 additional physicians, a 3% increase in the current workforce.
Shortfall: Currently, there is a shortfall of 15,230 primary care physicians, according to data from the Association of American Medical Colleges. This number is almost certain to shoot up in 2014, which is when insurance expansion for about 30 million Americans will go into effect. What’s more, the shortage may increase to 130,000 by 2025, says the study.
In addition to healthcare reform, other factors contributing to the future shortfall are: 1) an increase in physician visit rates for people over 45 years old (visit rates have been rising steadily over the past 30 years for this group); 2) younger physicians working fewer hours; 3) more physicians nearing retirement; 5) tepid growth in graduate medical school enrollment; and 6) perceived inadequate compensation for primary care physicians.
What it means: For hospitals, the long-term effect of this is that the cost of hiring a physician will rise as the supply decreases in the face of increasing demand.