Impact of Health Reform on Healthcare Jobs BIANCA K. FROGNER, PHD - PowerPoint PPT Presentation

Impact of Health Reform on Healthcare Jobs BIANCA K. FROGNER, PHD ASSOCIATE PROFESSOR, DEPARTMENT OF FAMILY MEDICINE DIRECTOR, CENTER FOR HEALTH WORKFORCE STUDIES ( TWITTER: @UWCHWS) UNIVERSITY OF WASHINGTON “PANEL ON CRITICAL AND EMERGING ISSUES IN HSR” ACADEMYHEALTH ANNUAL RESEARCH MEETING NEW ORLEANS, LA JUNE 26, 2017

Acknowledgements Collaborators: ◦ Joanne Spetz, PhD, Professor, Associate Director of Research, Healthforce Center, University of California, San Francisco ◦ Steve Parente, PhD, MPH, MS, Professor, University of Minnesota, Carlson School of Management ◦ Shelley Oberlin, MHA/MBA, Health Systems Innovation Network, LLC Other Acknowledgements: ◦ Health Systems Innovation Network, LLC for adaptation of ARCOLA model ◦ Jonathan Keisling, American Action Forum

Background (1) Healthcare industry has been “job engine” for US economy for last decade: • Healthcare employment grew by 21.7% between 2003 and 2013 1 o Driven by growth in ambulatory care employment • Over 15.7 million people working in healthcare as of May 2017 2 • One of largest employment sectors ( 10.7% as of May 2017) 1. Frogner, 2017, MCRR; 2. BLS: https://data.bls.gov/pdq/SurveyOutputServlet; 3. Frogner, Spetz, Parente, Oberlin, 2015, IJHEM; BLS: https://www.bls.gov/emp/ep_table_103.htm

Number of Jobs by Sector, 2016 7,000,000 5,901,050 6,000,000 5,000,000 4,000,000 3,312,800 3,000,000 2,516,790 2,000,000 1,390,000 1,354,620 834,190 1,000,000 - Hospitals Outpatient Care Physician Offices Other Ambulatory Home Health Care Nursing/Residential Centers Services Care Facilities 1. https://www.bls.gov/oes/

Healthcare Jobs by Sector and Type, 2016 1 Healthcare Practitioners/Technical Jobs Healthcare Support Jobs All Other 100% 90% 32.4% 38.8% 80% 39.8% 40.0% 49.3% 50.6% 70% 12.5% 60% 17.3% 19.0% 50% 10.6% 37.1% 40% 31.9% 30% 55.1% 42.9% 41.0% 20% 40.0% 24.2% 10% 17.5% 0% Hospitals Outpatient Care Physician Offices Other Ambulatory Home Health Care Nursing/Residential (N=5,901,050) Centers (N=834,190) (N=2,516,790) (N=1,390,000) Services Care Facilities (N=1,354,620) (N=3,312,800) 1. https://www.bls.gov/oes/

Background (2) Prior to new administration, healthcare jobs projected to grow into the next decade: • Another 20 to 26% growth (3 to 4 million additional jobs) projected by 2022 3 o 40% (1.2 million) jobs driven by ACA expanding health insurance coverage leading to greater healthcare access and demand • 7 out of 10 fastest growing occupations projected by 2024 are healthcare jobs 4 o Jobs common in long-term care  demand from aging population with multiple chronic diseases 1. Frogner, 2017, MCRR; 2. BLS: https://data.bls.gov/pdq/SurveyOutputServlet; 3. Frogner, Spetz, Parente, Oberlin, 2015, IJHEM; BLS: https://www.bls.gov/emp/ep_table_103.htm

Projected Gain in Jobs by Sector, 2014-2024 760,400 800,000 735,700 700,000 622,500 600,000 522,700 500,000 368,400 400,000 348,100 300,000 200,000 100,000 - Hospitals Outpatient Care Physician Offices Other Ambulatory Home Health Care Nursing/Residential Centers Services Care Facilities

Healthcare Job Gains by Sector and Type: BLS NEM 2014 to 2024 Healthcare Practitioners/Technical Jobs Healthcare Support Jobs Other 100% 90% 24.7% 35.1% 38.1% 80% 40.3% 45.3% 55.1% 70% 12.2% 60% 17.2% 25.0% 50% 11.7% 35.1% 40% 63.1% 30% 31.8% 44.8% 43.0% 20% 39.9% 24.6% 10% 13.2% 0% Hospitals Outpatient Care Physician Offices Other Ambulatory Home Health Care Nursing/Residential (N=368,400) Centers (N=348,100) (N=522,700) (N=622,500) Services (N=760,400) Care Facilities (N=735,700) 1. https://www.bls.gov/emp/ep_table_109.htm

Study Motivation and Question With debates about ACA repeal and replace, several reports project job loss with reduction in government spending/subsidies and repeal of mandate: • Ku et al. 2017 newly released report projects 924,000 job loss across economy by 2026 1 o 78% ( 725,000 jobs ) lost in healthcare alone • Bivens 2017 report projects 1.2 million job loss across economy by 2019 2 • Frogner & Spetz 2017 blog post suggests our projection of 1.2 million healthcare jobs driven by ACA will not be realized 3 Study Question: How will health reform impact jobs within healthcare industry? 1. Update Frogner et al. 2015 IJHEM paper to look at impact of AHCA proposal 2. Compare results using different projection models for insurance coverage loss/uptake 3. Examine change in jobs within healthcare sector and by job type 1. www.cmwf.org; 2. http://www.epi.org/publication/repealing-the-affordable-care-act-would-cost-jobs-in-every-state/; 3. UCSF blog post: https://healthforce.ucsf.edu/blog-article/healthcare-policy/aca-repeal-pull-job-opportunities

Methodology and Data Healthcare Jobs (#) Insurance Status (#) 2016 Utilization Rates by Actual - Hospitals - Uninsured Insurance Status (#) - Outpatient - Employer sponsored - Hospitals % Δ - Physician offices Δ Healthcare insurance (ESI) - Outpatient Utilization - Long-term care - Individual Market - Physician offices Jobs by Setting by Setting - Home health - Medicaid - Other ambulatory 2016 to 2025 2016 to 2025 - Skilled nursing - Long-term care - Residential - Home health 2025 - Skilled nursing Projected - Residential Data Source: Data Source: Data Source: - ARCOLA 1 - 2016 Occupation - Health Exchanges CBO 2 Employment Statistics 4 - - Claims data OACT/CMS 3 - Note: Only modeling changes related to <65 population 1. ARCOLA: Parente et al, 2017; 2. CBO: https://www.cbo.gov/system/files/115th-congress-2017-2018/costestimate/americanhealthcareact.pdf; 3. OACT/CMS:https://www.cbo.gov/system/files/115th-congress-2017-2018/costestimate/americanhealthcareact.pdf; 4. https://www.bls.gov/oes/

Insurance Coverage Projections under Current Law v. AHCA: Percent Change from 2016 to 2025 Insurance Current Law American Health Care Act Type ARCOLA 1 OACT/CMS 2 CBO 3 ARCOLA OACT/CMS CBO Uninsured +59% +10% +4% +50% +51% +89% Employer No +4% -2% -1% +2% -3% Sponsored change Health Insurance Individual -43% -2% +14% +23% -9% -18% Market Medicaid +8% +10% +4% -16% -1% -21% 1. ARCOLA: Parente et al, 2017; 2. OACT/CMS:https://www.cbo.gov/system/files/115th-congress-2017-2018/costestimate/americanhealthcareact.pdf; 3. https://www.cbo.gov/system/files/115th-congress-2017-2018/costestimate/americanhealthcareact.pdf

Number of Healthcare Jobs Lost/Gained under Current Law v. AHCA Current Law AHCA 1,000,000 627,522 500,000 274,655 64,535 - (171,250) (174,929) (500,000) (1,000,000) (1,500,000) (1,627,311) (2,000,000) ARCOLA OACT/CMS CBO

Difference in Job Loss/Gain between Current Law v. AHCA, by Sector ARCOLA OACT/CMS CBO 100,000 3,435 - (9,967) (15,387) (22,812) (24,486) (24,966) (40,860) (49,454) (55,846) (100,000) (66,809) (79,762) (100,890) (108,566) (118,136) (200,000) (229,961) (260,334) (300,000) (315,071) (400,000) (500,000) (521,161) (600,000) Hospitals Outpatient Physician Offices Other Ambulatory Home Health Care Nursing/Residential Services Care Facilities

Difference in Job Loss/Gain between Current Law v. AHCA, by Job Type ARCOLA OACT/CMS CBO - -47,461 (100,000.00) -70,982 -90,732 -97,592 -139,517 -142,368 (200,000.00) (300,000.00) -288,790 (400,000.00) (500,000.00) (600,000.00) -558,506 -605,087 (700,000.00) Healthcare Practitioners/Technical Healthcare Support Jobs All Other Jobs

Summary of Findings • Job gains expected under Current Law under ARCOLA and OACT/CMS assumptions o CBO assumptions suggest slight job loss • CBO assumptions paint worst job scenario under AHCA with over 1.5 million healthcare jobs lost o OACT/CMS best picture with job gains under AHCA, but not as large gains as under Current Law • AHCA has negative impact on healthcare jobs across all models, sectors, and job type o Ranging from 235,785 to 1.5 million fewer jobs under AHCA v. Current Law • Physician offices may experience largest loss in jobs under ARCOLA and CBO assumptions o OACT/CMS assumptions suggest largest loss in hospitals • All job types expected to fare worse under AHCA o Other non-healthcare jobs expected to experience largest loss across models

Limitations • Did not include any changes related to Medicare o May be important for long-term care • Assumptions vary across models o Different baseline insurance coverage estimates o Hard to predict response by states, employers and individuals • Utilization rates based on 2011 data o Did not model how utilization changes over time • Did not account for changes in health workforce or healthcare employer response to change in demand

Conclusions and Policy Implications • Ambulatory care, particularly physician offices, are at most risk at losing jobs o Shifting workers back to inpatient care and emergency services? o Existing issues in supply of workers for long-term care, which health reform does not address • All models suggest healthcare job growth may slow under AHCA o However, overall healthcare job growth may continue, most likely driven by demand from aging population. o Need to still think about how novel and flexible ways of using workers (e.g., team based care, emerging roles, telemedicine, mHealth) are changing demand for healthcare jobs • Projections may mask shifts across states o State level monitoring needed to better understand how shifts in care utilization and employer use of healthcare workers is changing demand for healthcare workers.