Workforce Shortage Click here to read the health care workforce shortage and its implications on America’s hospitals, at the American Hospitals Association’s (AHA) website. Select a hospital, which is not more than two hours away from your place of resi

healthcare
 

Workforce Shortage

Click 

here

 to read the health care workforce shortage and its implications on America’s hospitals, at the American Hospitals Association’s (AHA) website.

Select a hospital, which is not more than two hours away from your place of residence. Based on your readings and understanding, create a 3- to 4-page report in a Microsoft Word document, that includes:

A plan for a rural, medium-sized hospital to deal with short- and long-term workforce shortages.

Your plan should include the following elements:

• An introduction.
• A description of the health care workforce shortage and its implications.
• The aspects that need immediate attention and aspects that need long term attention. Provide a rationale on why these aspects need attention.
• A description of the financial implications for these issues.
• An explanation of the risks associated with these problems.
• Your recommendations to solve these problems.
• An explanation of the methods to measure the success of the plan.
• A description of the next steps, if the plan failed.
• A conclusion and a reference list.

Support your responses with examples.

Cite any sources in APA format.

 

April 2011

In the fall of 2010, the Alliance for Health
Reform, with support from the Robert
Wood Johnson Foundation, held a series of
Capitol Hill briefings on issues pertaining to
the health care workforce. The first brief-
ing in the series examined the physician
workforce. It looked at supply and demand
issues that may be changing as a result
of health reform. Panelists were: Edward
Salsberg, National Center for Workforce
Analysis, HRSA; Thomas Ricketts, Cecil G.
Sheps Center for Health Services Research,
University of North Carolina at Chapel Hill;
and Jay Crosson of the Kaiser Permanente
Institute for Health Policy. The second
briefing focused on nurses, allied health
professionals, direct care workers and the
various provisions of the health reform law
pertaining to them. Panelists were: Joel
Teitelbaum, George Washington University;
Bob Konrad, Cecil G. Sheps Center; Linda
Burnes Bolton, Cedars-Sinai Medical Center
and Catherine Dower, University of Califor-
nia, San Francisco.

Health Care Workforce:
Future Supply vs. Demand

Physician and nursing shortages
make headline news on a regular
basis. Debates continue in policy
circles among researchers, analysts
and stakeholders on whether the
shortages are due to insufficient
numbers of providers, or maldistri-
bution of those providers.

Experts also debate over whether
the solutions are to build more
schools and enlarge classes to
graduate more physicians, expand
the number of residency slots, find
incentives to attract providers to
health professional shortage areas,
or change the way we deliver care.

We begin to see the complexity of
analyzing the problem and matching
the solutions to the challenges if we
also consider:
• Is there an adequate and efficient

ratio of primary care providers to
specialists?

• Are we training for the right skills?
• Are those with skills using them to

their maximum potential?
• Where do nurses and licensed and

unlicensed allied health profession-
als fit into the picture?

Some key factors affecting
the adequacy of the health
care workforce include
growth in the insured
population as a result of the
health reform law, an aging
U. S. population, an aging
health care workforce, the

Fast Facts
n 40 percent of practicing physicians are older than 55; about one-third of

the nursing workforce is over age 50.

n Economists say a third of physicians could retire in the next 10 years.

n More than half of nurses over 50 say they plan to retire in the next de-
cade.

n Team-based care and an expanded role for advance practice nurses and
physician assistants could mitigate the shortage of primary care providers.

n The Institute of Medicine recommended, in October 2010, that nurses be
allowed to practice to the full extent of their education and training. Cur-
rently only eleven states allow nurse practitioners to practice independent
of a physician.

n Student medical school debt averages $145,000 for those graduating
from public medical schools and $180,000 for those graduating from
private schools, causing many to choose higher paying specialty areas of
practice over primary care.

n According to the Bureau of Labor Statistics, the economic downturn be-
ginning in December 2007 has resulted in a loss of 8.4 million jobs. In this
same period, health care employment grew by 732,000.

diversity of the workforce
and the state of the economy.
Another possibly important factor —
the evolution of health care technology
that enhances diagnosis and increases
the breadth of treatable ailments — is
beyond the scope of this issue brief.

The health reform law enacted in
March 2010 is scheduled to add 32
million previously uninsured per-
sons to the rolls by 2019. (See more
below.) This is one of the key fac-
tors expected to worsen the existing
shortage of physicians for at least
another decade. By 2025, the shortage
could grow by as much as 25 percent,
according to one analysis. (See chart,
“Projected Physician Supply and
Demand.”)

How many more physicians
we may really need is
still an unsettled

2 Health Care Workforce: Future Supply vs. Demand

question. Some researchers speculate
that increasing the supply of physi-
cians may make our health care sys-
tem worse, not better.

Another key factor is the aging of
the population and the demands re-
sulting from the complex chronic care
needs of older persons. The first
of the boomers turned 65 in
January 2011 and became eli-
gible for Medicare. A total of
78 million boomers will reach
that age by 2030.

Providers who serve this population
are already in short supply. Complaints
have been heard for a while that new
Medicare beneficiaries can’t find a
physician who accepts new Medicare
patients. Six percent of Medicare
beneficiaries reported that they looked
for a new primary care provider in
2009. Of those 6 percent who reported
seeking a new primary care physi-
cian, 22 percent reported their search
to be a problem; 10 percent reported
it a “small problem” and 12 percent

reported it a “big problem.”
In recent years, the greatest growth

in utilization of services has been
among those 75 years of age and
older. Geriatricians, primary care phy-
sicians for this segment of the popu-
lation, number a mere 6,830 and are
already spread thinly, one for every
1,900 seniors age 75 or older. Accord-
ing to an Institute of Medicine study,
the U.S. would need 36,000 geriatri-
cians by 2030 to meet the need.

The workforce itself is likewise ag-
ing and some say that one third of cur-
rent physicians will retire over the next
10 years. Close to 40 percent of doctors
are older than 55 years of age. And
younger professionals have different
practice patterns than their predeces-
sors (e.g., men and women age 25–40
tend to work fewer hours than previous
generations of health professionals).

About one-third of the nursing
workforce is older than 50 and more
than half have expressed an intention
to retire in the next decade. The U.S.
nursing shortage is projected to grow
to 260,000 registered nurses by 2025.

Several factors are thought to
contribute to the projected shortage in
nursing. These include a diminishing
pipeline of new students to nursing,
a decline in RN earnings relative to
other career options, an aging nursing
workforce, and the aging population
that will require more intense health
care services. In addition, nurses re-
port high levels of job dissatisfaction,
which leads to high turnover and early
retirement among RNs.

The Patient Protection
and Affordable Care Act
(popularly, the ACA) of
March 2010 aims to cover
an additional 32 million
American citizens and legal
residents beginning in 2014.
It is expected that one-half of those
newly insured will be added through
expanded Medicaid programs.

The remaining half will obtain
coverage through state health insur-
ance exchanges. Some will gain
coverage with the aid of government
subsidies, others through incen-
tives to small business employers to
provide coverage to their employees.
Young adults up to the age of 26 are
already able to get coverage under
their parents’ policies. Other individ-
uals are purchasing private insurance
on their own for the first time —
something many couldn’t do in the
current individual market if they had
a preexisting condition.

By whatever means,
expanding coverage to
32 million people increases
the demand on the current
and future provider supply.

The ACA has a number of provi-
sions that address health care workforce
issues. The three main goals of these
provisions are to alleviate shortages,
ease uneven geographic and specialty
distribution, and address the lack of
diversity in the health professions.
Some provisions are specific to the
physician workforce, others to nurses,

Projected Physician Supply and Demand:
Baseline and Alternative Scenario*, 2006–2025

F
T
E

P
h
ys

ic
ia

n
s

(e
x
cl

.
re

si
d

e
n
ts

)

* Alternative scenario projected by AAMC uses a set of assumptions including increased
utilization, changes in work schedules, expansion of GME capacity and productivity
improvements.

Source: Association of American Medical Colleges, Center for Workforce Studies. October 2008. “The Complexi-
ties of Physician Supply and Demand: Projections Through 2025.”
(http://www.tht.org/education/resources/AAMC )

Alternative scenario demand

Baseline
demand

Alternative scenario supply

Baseline supply

950,00

0

900,000

850,000

800,000

750,000

700,000

650,000

600,00

2005 2010 2015 2020 2025

Health Care Workforce: Future Supply vs. Demand 3

allied health professionals and licensed
and unlicensed direct care workers. The
provisions range from creating entities
to collect and analyze data, to support-
ing education of health professionals
and providing incentives that encourage
the practice of primary care.

Health professional shortages are
more acute in some fields of practice
than in others. The ACA establishes
grant programs aimed at education
and training for primary care, direct
care, oral health specialists, geriatric
education centers, behavioral health,
cultural competency, nursing, nurse
practitioners, public health and under-
represented minorities.

Models of care that rely
on primary care playing a
greater role in chronic care
management are beginning to
show evidence of increasing
quality of care and containing
costs. Evidence from abroad and
from geographic variation here at home
seems to indicate that the greater use of
primary care is a factor in improving
quality and reducing costs.

Some of these innovations are
included in the reform law as pilot
programs. Some rely on team-based
care and an expanded role for ad-
vance practice nurses and physician
assistants. Such models could result
in the more efficient use of the health
care workforce and extend the reach
of primary care providers. There are a
number of reasons why primary care
tends to be the focus of attention when
speaking of current and future short-
ages of health professionals. One is
that fewer physicians choose to prac-
tice primary care than other specialties
and subspecialties.

Students graduating with a medi-
cal degree often have large amounts
of debt, an average of $145,000 for
those graduating from public medi-
cal schools and $180,000 for those
graduating from private schools. They
look to the professions where they can
more easily or more quickly recover
the cost of their education and repay

their debt. Primary care physi-
cians are at the bottom of the
physician income chart. Radi-
ologists and orthopedic sur-
geons at the upper end of the
scale might earn three times
the income of a primary care
physician. (See chart “Total An-
nual Compensation for Select Private
Practice Physicians.”)

Other factors include the students’
socio-economic background, whether
they are from a rural or urban envi-
ronment and where they trained. Ac-
cording to a 2009 study, being born
in a rural area, interest in serving
underserved or minority populations,
and rural or inner-city training expe-
riences significantly increase the like-
lihood of students choosing primary
care, rural and underserved careers.
So does attending a public medical
school. The fact that 60 percent of
medical students come from families
in the top 20 percent of households
by income may be a confounding
factor here.

To lessen the impact of some of
these forces and encourage more health
professionals to choose primary
care, the ACA provides financial
incentives for providers to practice
in primary care specialties. These
include higher Medicare reimburse-
ment rates to primary care providers
and general surgeons and additional
bonus payments for practicing in
shortage areas.

Other provisions pertain to
education and the incentives come
in the form of loan repayments. For
example, the ACA authorizes loan
repayments for pediatric specialists
and public health workers.

The National Health Service
Corps (NHSC) expansion which
began under the American Recovery
and Reinvestment Act was further
expanded in the ACA, which provid-
ed 1,099 new loan repayment awards
in 2010 to physicians promising to
practice in an underserved area. The
Corps’ physicians who enter under
this program receive up to $170,000

in loan repayment for completing a
five-year service commitment.

The program starts with an initial
award of $60,000 for two years of
service. Total debt repayment is prom-
ised for six or more years of service.
Many types of health care facilities
are NHSC-approved sites. About half
of Corps members serve in federally-
supported health centers. Other
approved sites are rural and Indian
Health Service clinics, public health
department clinics, hospital-affiliated
primary care practices, managed care
networks, prisons, and U.S. Immigra-
tion and Customs Enforcement sites.

Still other provisions of the ACA
pertain to Graduate Medical Educa-
tion (GME) or residency training
programs. For example, revisions
to GME would redistribute unused
residency positions to create more
primary care slots. A new program
allows HHS to fund teaching health
centers to expand and establish resi-
dency training programs in non-tradi-
tional settings (i.e., outpatient settings
rather than hospitals).

In 2010, more than $250 million
of the new Public Health and Preven-

Total Annual Compensation
for Select Private Practice

Physicians 2009
PRACTICE AREA 2009*

Median ($)

Orthopedics 473,770

Radiology 468,594

Dermatology 385,088

Pediatrics 192,000

Family Medicine
(w/o OB)

183,999

Geriatrics 179,950
*Medical Group Management Association.
Physician Compensation and Production
Survey, 2010 Report Based on 2009 Data.

Source: American Geriatrics Society, Geriatrics
Workforce Policy Studies Center. Adapted
from Table 1.7. http://www.adgapstudy.uc.edu/
figs_practice.cfm

4 Health Care Workforce: Future Supply vs. Demand

tion Fund was allocated to address the
supply of primary care providers as
authorized in several ACA provisions.

Better information is needed to
assess current and future workforce
needs and to guide the workforce
marketplace. The ACA establishes a
national center for health workforce
analysis to develop performance mea-
sures, collect data, and create a data
reporting system.

It also establishes a national health
care workforce commission to en-
courage innovation, identify barri-
ers to improved coordination, and
make recommendations to Congress
and the Administration about how to
solve workforce shortages and other
identified workforce problems while
improving care delivery. The members
of the commission have been named
but funds have not been appropri-
ated for their activities. Among the
15 commission members are five phy-
sicians, two nurses and one dentist.
The remaining members are research-
ers, analysts and other stakeholders.

While most of the headlines
focus on physician and
registered nurse shortages,
another significant shortage
— that of direct care workers
— has received far less
attention. These workers include
medical assistants, nursing assistants
or nursing aides, home health aides
and personal and home care aides —
numbering 3 million workers in 2008.

They constitute one of the larg-
est and fastest growing parts of the
country’s workforce. They are part of
the reason why health care is one of
the few sectors that has been growing
jobs in this economy while employ-
ment in other sectors has been stag-
nant or shrinking. The growth rate for
direct care workers exceeds that of
other types of personnel in the health
care sector and is expected to increase
by almost 35 percent by 2018. It is
projected that the nation will require
10–12 million new and replacement
direct care workers in 10 years, as the
total number of such workers needed

grows by some 1.1 million. (See chart,
“Direct Care Workforce.”)

The ACA recognizes the value
of direct care workers to health care
delivery and contains a number of ini-
tiatives that address current issues and
future challenges. Provisions include
grants and incentives to enhance train-
ing, recruitment and retention of direct
care staff. Grants to Geriatric Educa-
tion Centers for faculty fellowships
require that the centers offer courses
on geriatrics, chronic care manage-
ment and long-term care. They also
require that activities include family
caregiver training.

An important companion provi-
sion is for state health care workforce
development grants. Training and
licensing of direct care workers vary
greatly from state to state. The ACA
establishes a demonstration program
that would award grants to six states to
develop core competencies, pilot train-
ing curricula, and develop certification
programs for personal and home care
aides. The law appropriates a total of
$85 million for five years to this dem-
onstration grant program. (See more on
the role of the states below).

The law also establishes a Personal

Care Attendants Workforce Advisory
Panel. The function of the panel is
to advise the U.S. secretary of health
and human services and Congress on
the number of personal care attendant
workers, their salaries, wages and
benefits and the adequacy of access to
their services. The work of the panel
will be subject to the constraints of the
appropriations process.

Many provisions in the ACA
pertain to health workforce
education and training at all
levels, assessing needs, and
the delivery of care. But the
states will have a major role in
how it plays out.

Many medical and nursing schools
and other educational institutions
training health care workers are finan-
cially supported by their states and
the states have much to say about the
number of slots in these schools and
the number of degrees awarded. States
are the government entities under
which licenses to practice are granted.
State practice acts set boundaries on
what a health professional can or can-
not do, defining the activities that a

Direct Care Workforce,
2008 Actual Compared to 2018 Projected

N
u
m

b
e
r

o
f

W
o

rk
e
rs

Source: PHI “Who Are Direct-Care Workers?” Fact Sheet 3. February 2011.
http://www.directcareclearinghouse.org/download/NCDCW%20Fact%20Sheet-1

5,000,000

4,000,000

3,000,000

2,000,000

1,000,000

0

2008 2018

Home Health Aides Nursing Aides, Orderlies & A�endants Personal Care Aides

922,000

1,470,000

817,000

Total: 3,209,000

Total: 4,322,000

1,383,000

1,746,000

1,193,000

Health Care Workforce: Future Supply vs. Demand 5

qualified professional can perform.
In essence, physicians are not lim-

ited in their scope of practice. Though
they are also licensed by their state,
scope of practice laws for physicians
are consistent throughout the coun-
try. They can practice medicine and
perform surgery limited only by the
standards set by their professional
associations or certifying boards,
institutional policies and the standard
of practice in the geographic area in
which they perform.

This is less true for other health
professions. For example, the tasks
nurses and physician assistants are
allowed to perform independently vary
from state to state. In some states, ad-
vance practice nurses can see patients
and prescribe medications with less
supervision by physicians than in other
states, or with no supervision at all.

In such states, it is not unusual to
see a nurse practitioner running a pri-
mary care practice or clinic in a rural
area where there is a physician short-
age. A physician may be on call as
backup for the nurse when necessary,
or the physician may visit the practice
weekly to see special cases. The ACA
creates a $50 million grant program to
support such nurse-managed clinics.

Evidence cited by many
experts suggests that
quality and safety are not
compromised and access is
improved when nurses are
able to exercise the practice
of their skills to their full
potential. However, most states
require physician supervision of
nurses.

Currently only 11 states allow
nurse practitioners to practice inde-
pendent of a physician. An October
2010 report by the Institute of Medi-
cine recommended that nurses be
allowed to practice to the full extent
of their education and training. It
suggested that the federal govern-
ment might promote reform of states’
scope of practice laws by sharing and
providing incentives for the adoption
of best practices.

Several states have faced lawsuits
over the last decade from professional
groups seeking to change their state’s
practice acts. Examples include nurse
anesthetists in California and Colo-
rado, nurse practitioners in Florida and
direct-entry midwives in Illinois. These
noteworthy examples notwithstanding,
generally professional groups seek to
change practice acts through legisla-
tion, not through lawsuits.

Another element in the federal-state
health reform partnership and also part
of the investment strategy in primary
care is a provision in the ACA that en-
courages states to plan for and address
health professional workforce needs.
In June 2010, HHS Secretary Kathleen
Sebelius made $5 million available for
states to plan and implement innova-
tive strategies to expand their primary
care workforce by 10 to 25 percent
over 10 years to meet the increased
demand for primary care services.

Some analysts question
whether physicians being
trained today are learning
the right skill set. Are they being
trained to practice evidence-based
medicine, team-based care, care
coordination and shared decision
making?

The June 2010 report of the Medi-
care Payment Advisory Commission
(MedPAC) asserts that a reformed
delivery system will “require health
care professionals trained to provide
coordinated care across institutional
boundaries and trained in the skills
required to promote patient safety and
quality.”

It raises the question of whether
GME training is taking place in the
right setting and is imparting the
necessary skills. It suggests that cur-
rently there is an overemphasis on
hospital based training or inpatient
care. An essential part of training, the
report asserts, should involve time and
experience in other settings such as
physician practices, nursing facilities
and nonhospital clinics to prepare
providers for the tasks they will face
in caring for chronic conditions and
keeping people out of hospitals.

The U.S. is a racially and ethni-
cally diverse nation and is projected to
become even more so in the future.

Though there has been
an increase in diversity
in U.S. medical schools
overall, including some
significant gains in 2010,
many ethnic groups remain
underrepresented relative
to their numbers in the U.S.
population. This is particularly
true of Blacks, Latinos, and Native
American groups. The issue is of
importance with regard to access to
care and quality of care. For example,
speakers of other languages may
be at a disadvantage if they don’t
understand the information given
them by their provider.

People who are ill might delay seek-
ing care if they fear they will not be
treated by someone who understands
their culture or language. This is true
at all levels of care — primary care,
specialty care, long-term care, home
health care — and in all settings —
medical office, hospital, nursing home,
or home and community based care.

The policy solutions are not simple
and require action on multiple fronts.
Recruiting for health careers begins at
early education levels and entails ex-
posing children at all ages to education
and career options that might not be in
their immediate frames of reference.

The health industry has
been growing jobs steadily
for some time, even during
recent bad economic times.
According to the Bureau of Labor
Statistics, the economic downturn
beginning in December 2007 has
resulted in a loss of 8.4 million jobs.
In this same period, health care
employment grew by 732,000.

The largest segments of the health
care workforce are found in hospitals
(40 percent), nursing and residential
care facilities (21 percent), and physi-
cian offices (16 percent). This speaks
to the importance of local hospitals
and other medical facilities to the

6 Health Care Workforce: Future Supply vs. Demand

economy of a community and to the
political importance of health care
overall, even in the face of efforts to
“bend the health care cost curve.”

There is little doubt that the health
care workforce affects us all. There is
also little doubt that it is hard to make
policy decisions based on unknowns
and projections that vary greatly from
one report to another.

This is especially so while health
care delivery itself may be undergoing
a dramatic transformation. Ed Sals-
berg, director of the new Na-
tional Center for Health Work-
force Analysis, observed that
“increasing the supply alone
will not be sufficient to as-
sure access. Redesigning the
delivery system to make more
effective use of our health
workforce is critical.” However,
we can try to interpret what the projec-
tions of workforce shortages really tell
us; and we can attempt to identify the
policy questions that we face now and
will face in the near future.

Are the physician shortages abso-
lute or distributional? What choices
are medical students, nursing students,

and others making with regard to area
of practice and why? Which health
professional categories are growing
jobs? What role will nurses play in the
redesign of health care delivery?

How can we make primary care
more attractive as a career and how
can we attract more providers to
underserved areas? Does increasing
the supply through additional medi-
cal schools, nursing schools and other
training programs get at the shortage
in adult primary care?

On the national versus state front,
there are additional policy issues
that require a closer look, issues not
touched on here. For example, in the
era of technology and the advances
being made in telemedicine, what hap-
pens when providers practice across
state lines? Will their state licenses
allow them privileges to practice in
other states and will they be reim-
bursed for their services? Is there a

need for national standards so that
state licensing and scope of practice
laws do not impair access?

Policymakers, stakeholders and the
American public can look forward to
developments on several fronts:
• Data forthcoming from the Na-

tional Center for Health Workforce
Analysis providing some answers
on workforce needs;

• Recommendations on policy issues
from the new National Health Care
Workforce Commission to the Sec-
retary and Congress; and

• Physicians, nurses and all mem-
bers of team-based care working
together to design and implement a
more efficient, high quality, patient
centered medical system.

For the sources used in writing this
issue brief, email info@allhealth.org
or call 202/789-2300.

Alliance for Health Reform
1444 I Street, NW, Ste 910
Washington, D.C. 20005
Phone 202/789-2300
Fax 202/789-2233
www.allhealth.org

Acknowledgements
This publication was made possible by

a grant from the Robert Wood Johnson
Foundation. The Alliance is grateful for that
support.

The Alliance also thanks Deanna Okrent,
the author of this paper.

The Alliance is a nonpartisan, not-for-
profit group committed to the education of
journalists, elected officials and other shapers
of public opinion, helping them understand
the roots of the nation’s health care problems
and the trade-offs posed by various proposals
for change.

Design by Yael Konowe of Yael Design,
Reston, Va.

Printed on recycled paper, © 2011.

Selected Experts
n Linda Burnes Bolton, Cedars Sinai Medical Center 310-423-5191
n Peter Buerhaus, Vanderbilt University 615-322-4400
n Jay Crosson, Kaiser Permanente Health Policy Institute 510-393-9430
n Catherine Dower, University of California San Francisco 415-476-1894
n Susan Hassmiller, Robert Wood Johnson Foundation 609-627-7585
n Darrell Kirch, Association of American Medical Colleges 202-828-0400
n Robert L. Phillips, Jr., The Robert Graham Center 202-331-3360
n James Potter, American Academy of Physician Assistants 703-836-2272
n Tom Ricketts, Cecil G. Sheps Center 919-966-5541
n Ed Salsberg, HRSA 301-443-9355
n Dorie Seavey, PHI (Paraprofessional Healthcare Institute) 617-630-1694
n Joel Teitelbaum, George Washington University 202-994-4423

Selected Websites
n Alliance for Health Reform www.allhealth.org
n Association of American Medical Colleges www.aamc.org
n Cecil G. Sheps Center for Health Services Research www.shepscenter.unc.edu
n HealthReformGPS www.healthreformgps.org
n HRSA Bureau of Health Professions bhpr.hrsa.gov
n Institute of Medicine www.iom.edu
n MedPAC www.medpac.gov
n PHI (Paraprofessional Healthcare Institute) www.PHInational.org
n Robert Graham Center www.graham-center.org
n Robert Wood Johnson Foundation www.rwjf.org

For additional experts and websites on this and other subjects, go to www.allhealth.org