This article from the Wall Street Journal talks about the increasing shortage of physicians in the U.S. and how it looks as though it will only get worse. To make matters worse, many people believe that the new healthcare reform act will cause more people to consume healthcare resources, thereby increasing the need for healthcare professionals even more.
"It will probably take 10 years to even make a dent into the number of
doctors that we need out there," said Atul Grover, the AAMC's chief
advocacy officer.
Obviously an increased need for healthcare professionals will benefit the healthcare staffing industry. However, many measures need to be taken to ensure the shortage doesn't grow to severe. Even though healthcare reform will positively affect the healthcare staffing industry, too severe of a shortage will hurt us all as a country. Unfortunately, the healthcare reform bill did not go far enough in addressing the growing need for healthcare professionals.
Proponents of the new health-care law say it does attempt to address the
physician shortage. The law offers sweeteners to encourage more people
to enter medical professions, and a 10% Medicare pay boost for
primary-care doctors.
This map is a great visualization of the shortage of physicians across the country.
Of course, how this legislation is carried out will determine the exact changes we all see and feel. There are several sources around the web that have posted summaries on some of the most immediate changes the healthcare reform legislation will make.
To me, the biggest question here is about the cost and potential tax increases we will all face as individuals and businesses. According to this interactive tool from the Washington Post, neither my premiums nor my personal taxes will increase due to healthcare reform. The really good news is that my premiums were expected to rise between 10-15% before "Obamacare," so I'm going to see this as being positive.
For businesses, it now appears that not providing health insurance to your employees will earn you a penalty. It will be interesting to see if this legislation changes the classifications or definitions of employees as to when insurance has to be provided. However, most large companies already provide insurance for all of their internal employees and offer it as a benefit to their field staff who meet qualifying hours. Therefore, there should be no impact to most healthcare staffing agencies in this regard. For new and small healthcare staffing companies (under 50 employees) there is even better news. Not only will these companies avoid potential penalties for lack of employee insurance provisions, they can qualify for stipends to provide insurance to their employees. This will offer tremendous assistance to start-up companies who otherwise couldn't offer coverage.
Unfortunately, big businesses will most likely see a tax increase to help pay for all the new legislation. Although I'm not a fan of paying more in taxes, I'm also not 'anti-tax' across the board. Paying taxes for certain things that benefit society, such as healthcare, is a good thing. I'm one of those crazies that believes in the greater good so I'm willing to pay a little more for it.
Many people disagree with this view completely and feel that healthcare reform is nothing short of socialism and the end of the American Empire. During a recent webinar hosted by the Staffing Industry Analysts, many CEO's of large staffing companies were discussing how detrimental this legislation will be to their business and all the other horrible things healthcare reform will bring. I've even had people on my blog leave comments and send me emails suggesting the same. For example, Randy Mensinger from Custom Healthcare left a comment on one of my healthcare reform blog posts stating he feels this will put the company he works for (and many others) out of business. He was so upset with my opinion that he even followed up on my comment with an email full of obscenities and calling me all kinds of things I won't repeat here.
So obviously not everyone shares my opinion. I'm willing to admit I could be wrong. If I am and businesses have to start carrying such a heavy tax burden that it puts them out of business I'll be right back here advocating against healthcare reform. I completely respect an opposing view and honest debate on healthcare reform. However, there are several things I don't understand, such as:
Being disrespectful and unprofessional to each other. It doesn't matter who you are, but, if you work for or represent a staffing company in our small industry I don't think it benefits you in any way to be unprofessional and disrespectful.
Where was the vociferous anti-tax movement during the bush years when we were spending trillions of dollars on an unjust war that was started for made up reasons? Perhaps if we hadn't spent so much money then (and now) we'd have money for things like healthcare for our citizens.
Many people are up in arms about the mandate that every American will be required to have health insurance. However, the health insurance mandates are actually a Republican idea. These mandates are only going to benefit the health insurance industry and those politicians beholden to this industry. So clearly their outcry is merely political posturing.
No matter how you feel, what we all really need is information, facts and a real debate. Much of the information coming from the media is full of sensational, unfounded claims. It's not only irresponsible, it's dangerous. Unfortunately, without reinstating the Fairness Doctrine it's only going to get worse. For example, this video:
I'm all for free speech but when this much hateful, misinformed rhetoric is pumped through the media for several hours a day, every day, it's no wonder people are resorting to violence against members of congress over something like healthcare reform. There are many reasons justifying the call for revolution. However, I assure you, healthcare reform is not one of them.
In summary, I truly believe that healthcare reform will benefit us as individuals and as a country. It will be a huge win for the healthcare staffing industry. That said, I'm not a fan of the government and will watch the outcomes of this legislation closely and with a critical eye. I am also willing to admit when I'm wrong. Therefore, if the sky starts falling or we witness the collapse and devastation of the medical staffing industry, you'll see me at the next tea party rally.
I hope the opposite is also true. If you're an opponent of this legislation and none of these horrible things come to pass it would be great to hear you admit you were wrong someday.
The economy continues to take its toll on the healthcare staffing industry. Even the largest healthcare staffing agencies can't seem to find any shelter.
As of today, Medical Staffing Network has yet to report its full 2009 results. However, in 2009 MSN lost $20 million of revenue in
the first three quarters, on revenue of $265.2 million. This was a 37% decline in sales from the same period in 2008.
“The company believes that based on currently projected cash inflows
generated from operations, it is possible that the company may be unable
to pay future scheduled interest and principal payments due to its
senior lenders as such obligations become due,” Medical Staffing Network
stated in the SEC filing.
Today, AMN Healthcare announced similar numbers. AMN reported fourth-quarter revenue fell 51.1% on a
year-over-year basis to $144.7 million. However, their relative good news was that their gross margins improved, reporting improvements from 25.7% to 28.4% from the
previous years quarter. AMN's fourth-quarter nurse and allied healthcare staffing revenue also fell
64.3% to $74.0 million from $207.3 million in the year-ago quarter. Unlike Cross Country, revenue in the segment fell 9.9% sequentially from the third quarter.
"I'm certain most would agree that 2009 represented the most
challenging year in the history of the healthcare staffing industry,"
President and CEO Susan Nowakowski said. "The unprecedented rise in
unemployment and severe economic contraction wreaked havoc and resulted
in precipitous drops in demand volumes unlike any other time."
Sadly, signs of economic recovery for the healthcare staffing industry still seem distant.
Think about the services you make use of every day from business to personal. Booking a hotel, finding a photo online, sharing information with your friends, or managing your internal work projects. Imagine if any of these services were as difficult to work with as our current healthcare system. Would you continue to use them?
Not being a big fan of the government, what shocks me is that, in this case, we're not talking about the government running something inefficiently. We're talking about private business. It's the private insurance companies that have failed to deliver a viable model or useful service when it comes to healthcare. How people can continue to support this broken system when they would have no tolerance for a similar level of service from the services they use everyday is beyond me.
This video is a parody of what it would be like to book a plane ticket with a travel agency that had a business model similar to our current healthcare system. Makes you think.
Gregg is an active blogger and continues to try new things. He is definitely helping to further advance the use technology and social media in the staffing industry. Thanks for having me on your show Gregg.
Bureau of Labor Statistics preliminary data show the healthcare sector created
267,000 new jobs in 2009. This is a significant drop from 2008 when
healthcare created 363,600 new jobs.
One thing we've learned is that healthcare was not completely
recession-proof over the last year and a half as we've seen a number of
large-scale layoffs across the board," says David Cherner, managing
partner of Health Workforce Solutions, LLC, a San Francisco-based
research firm. But, certainly, it is much stronger than any other
segment of the economy.
Here's to hoping the healthcare segment stays strong and proves to be a good year for jobs.
It's a question that never seems to go away. Can hospitals truly eliminate all of their agency usage? Perhaps a better question is - should they? From a management perspective, the healthcare staffing industry seems to be one of the last to see the usage of temporary labor as being negative.
By now we've all read the L.A. Times article that highlighted some bad practices of a few staffing agencies and used these examples to paint the entire industry with more negative stereotypes.
This week, Rebecca wrote another article about how hospitals are making effective use of technology to reduce their reliance on agency staff. She points out hospitals that have effectively deployed internal staff scheduling software to fill more shifts with internal staff, offer more scheduling flexibility and improve morale. The Healthleaders Media article made several great points on this topic
and I wanted to add a few of my own.
It's no secret that scheduling software applications can dramatically
improve a hospital's staffing situation. However, software won't solve the nursing shortage. It bothers me to say that. I'm a huge believer in technology but sadly, it will not solve all of our problems. Even though the economy has given us the illusion that the shortage of healthcare professionals has decreased, this is only a temporary situation (no pun intended). All analysis suggests the shortage will only continue to get worse. According to the Bureau of Labor, at 23%, the demand for nursing will be much greater than the average for all other occupations between 2006 and 2016. So no matter how efficient the software, if there's no staff to manage - there's no staff - and working with temporary labor is still necessary.
Deploying a solution to better manage your internal staff while ignoring the management of staffing agencies won't solve your hospital's staffing problem. Hospitals need a solution that will manage all of their staffing - both permanent and temporary.
The article includes some popular generalizations about the use of healthcare agency staff such as: using agency requires more organization and effort and that it "can
sometimes lead to resentment among the permanent staff, who question
why their hospital is willing to pay twice as much to agency nurses to
fill open shifts as it pays to its own loyal staff."
Healthcare Vendor Management Systems ensure that the process for managing agency staff is simple and effective. Implementing such a system means that the same, if not less, effort than managing internal staff is required. In addition, nurses do not get paid 2x as much if they work for an agency. The mark up on pay rates to agency staff does not equate to being 2x the cost of internal staff (especially if you factor in other benefits for internal staff) and this money is not all paid to the nurse. Further, there is an implication in this statement that the mark up is unnecessary. The mark up exists to provide quality staff, often under short notice and goes to cover the business costs of properly recruiting, screening, hiring and placing these professionals.
The solution is to more effectively utilize staffing agencies - not work toward eliminating them. Attempting to eliminate agencies can actually end up being more costly to hospitals in the long run due to increased staff overtime, burnout/turnover and higher management costs due to a lack of efficient processes if/when using agency staff is necessary. Additionally, until the nursing shortage is over it's not feasible for every hospital to fully eliminate their agency usage. Therefore, a better goal is to focus on more effective agency management - not elimination.
In the past I've written about several reasons to use agency staff so I won't repeat myself here. I'll only close by saying that focusing on things such as improved orientation, better credential compliance management and process automation with a comprehensive workforce management system is a more effective solution for hospitals in regard to addressing their concerns with agency staff.
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