By Debra Miller, CSG Director of Health Policy
While state policymakers often wring their hands over health care spending and how it may squeeze out other policy priorities, the flipside of that spending is jobs—lots of them and more to come in the future.
In 2012, the 17 million health care and social assistance jobs made up 14.6 percent of all
services producing jobs in the U.S., according to the Bureau of Labor Statistics. Only business and professional services and state and local government were bigger segments of the services producing sector—at 15.4 percent and 16.5 percent respectively.
The bureau projects health care and social assistance jobs will grow to nearly 22 million by 2022 and become the biggest job sector in 2022.
The rate of job growth in the health care sector has been nothing short of phenomenal.
Jean Moore, director of the Center for Health Care Workforce Studies at the University of Albany in New York, said health jobs grew by 22.2 percent from 2002 to 2012, compared to just 0.2 percent for all other job sectors. That growth is projected to continue in the next decade—from 2012 to 2022—with 26.5 percent growth in health care compared to 8.9 percent in other sectors.
Moore said the health care segment will grow, but the jobs and professions that make up the growth will depend on a number of factors.
“We are entering into pretty drastic changes in health care,” Moore said.
The problems with the current system are pretty well documented, she said.
“Services are fragmented. We are not getting particularly good outcomes. Services cost a fortune. Access to care varies greatly,” she said. “Providers are under the gun to improve access, improve quality and increase cost-effectiveness.”
But how providers make those changes, and how those changes will affect jobs, isn’t clear.
Take nurses, who make up the single largest occupational sector in health care. The demand for nurses historically has been driven by acute care delivered in hospital settings.
“But what if we move more services to ambulatory settings and there is a corresponding decline in the number of hospital beds and admissions?” Moore said. She gave New York as an example. An initiative there aims to reduce inappropriate hospital admissions for Medicaid enrollees.
Job Growth and the ACA
The Affordable Care Act, passed in 2010, also will influence the changing nature of the health care delivery system and its impact on the health care workforce.
Kentucky Gov. Steve Beshear, in his state of the commonwealth address in January, said his state’s decisions to expand Medicaid eligibility and increase the number of insured people—key elements of the ACA—already are growing health care jobs.
“From November 2013 to November 2014, the number of core health services jobs in Kentucky increased by 5,300,” Beshear said.
Since Gov. Beshear’s speech, a Deloitte Consulting and University of Louisville analysis commissioned by Kentucky found that Medicaid expansion will create more than 40,000 jobs through 2021, with an average salary of $41,000. For the past year, in addition to new jobs created in health care and social services, the report found another 6,600 jobs were created in other employment sectors.
The report also estimates a cumulative impact of $30.1 billion of the state’s economy through 2021. An additional $1 billion in a combination of state income taxes, state sales taxes and local payroll taxes are estimated during the time period 2014–2021.
“For all the naysayers who claimed that expanding Medicaid was a budget-busting boondoggle, take a look at the facts,” Beshear said at the report’s release in February, according to The (Louisville) Courier-Journal. “It’s working and it’s literally paying off. The state is saving money, hospitals are earning more, and our people are getting healthier.”
The Kentucky report underscores how the traditional Bureau of Labor Statistics data on current and projected employment by job sector probably underestimates how much the ACA has increased health care employment, according to Manoj Shanker, an economist with the Office of Employment and Training in the Kentucky Education and Workforce Development Cabinet. Shanker said BLS data cannot measure the effect of increased health care spending in generating multiplier effects in other employment sectors.
“Typically, smart doctors and smart hospitals outsource jobs, so, as a result, they are not counted in the health care sector,” Shanker said. He said the fee structure for Medicaid particularly encourages outsourcing to offset lower compensation rates.
Shanker said his local Kentucky hospital had outsourced many of its administrative and billing functions to a company in Georgia. The individual checking in the patient is the same person working the same job, but now is counted in the professional and business services sector, not health care and social assistance.
A national report refines Kentucky’s results.
President Obama’s Council of Economic Advisers in July 2014 released a report, “Missed Opportunities,” that found the 24 states that had not expanded Medicaid missed out on 85,000 new jobs in 2014 because of that decision. The report also said expanding Medicaid in those states would generate an additional 184,000 jobs in 2015 and 103,000 in 2016.
Missouri, which has not expanded Medicaid eligibility, completed a similar analysis.
The state Economic Research and Information Center concluded in a June 2014 report that the state’s health care jobs were growing at less than half the rate of the average growth in peer states that expanded Medicaid. The report also found Medicare and Medicaid cuts caused a direct loss of about 3,145 hospital jobs and impacted an additional 2,001 jobs due to indirect effects on companies that support hospitals and businesses that rely on hospital worker spending.
ACA and Health Care Delivery
ACA programs and policies also are likely to refocus the health care system toward primary and preventive care, Moore said.
Janet Haebler, associate director of state government affairs for the American Nursing Association, agreed.
“The majority of registered nurses work in hospitals, but with the ACA, that will change,” she said.
BLS data project more than 1 million new nurses will be needed between 2012 and 2022. More than half of those—526,800—are replacements for nurses retiring or otherwise leaving the profession. By contrast, a little less than 300,000 new physicians and surgeons will be needed over the same decade.
Haebler said there are enough nurses in the pipeline to meet projected increased demands now, but that will not be the case soon. The problem will be compounded by a projected shortage of nursing faculty. One half of all nursing faculty will retire in the next 10 years, she said.
One policy solution to get more nurses prepared to train the next generation is the type of legislation making its way through the New York legislature. All nurses would be required to earn their baccalaureate degree within 10 years of being licensed. The legislation was first introduced in 2005 and finally passed the assembly in 2014. Such legislation would increase the number of nurses with a bachelor’s of science in nursing degree who could go on to higher degrees and teaching.
On the practice side, Haebler said, states are removing barriers that prevent nurses, especially nurse practitioners, from performing duties that are consistent with their education and training. Some states are moving away from restrictive physician supervision, collaboration agreements and prescribing limitations.
Nurses are ideally suited to be care coordinators, supervising other health professionals, including community health workers and paramedics who are moving into providing community-based care in chronic disease management, Haebler said
“The future (of health care) is on the ambulatory side, on primary care and chronic disease management. Workers will need to learn new things: how to coordinate care, what is population health, how to manage chronic diseases and how to work on teams,” Moore said.
That could lead to growth in relatively new positions in health care, such as certified case managers and community health workers.
New Health Care Professions
As health care systems emphasize high-quality care and cost effectiveness, the use of certified case managers is becoming more commonplace.
Certified case managers have been recognized for about 20 years and now number 37,000 professionals actively working in patient care, according to Patrice Sminkey, chief executive officer of The Commission for Case Manager Certification. Nurses make up 87 percent of those certified, while another 5 to 6 percent are social workers.
“The field is growing because of the ACA,” Sminkey said. “We were at 20,000 case managers right before health care reform.”
The ACA is developing new models of care, she said, that require the use of a full, coordinated health care team. Case managers are key components of the medical home care model, as well as improved models of care for people dually eligible for Medicare and Medicaid.
Certification of case managers is not yet required by federal or state law, but some employers may ask for, or require, it shortly after hiring. Third-party accreditation also may require the exam-based credential.
Sminkey recommended that state policymakers include certified case managers in health system redesign conversations.
Community health workers are members of a second relatively new profession that has been shown to improve health outcomes and reduce health care costs. The Centers for Disease Control and Prevention finds a return on investment of $2 for every $1 spent.
A community health worker is a front line public health worker who is a trusted member of the community in which she works or has a keen understanding of the community served. They do not usually provide clinical services, but instead work to coordinate services, access appropriate services and provide outreach and advocacy.
A June 2014 report, Building a Community Health Worker Program, concludes that a well-designed community health worker program can improve population health, improve patient experience and lower per capita healthcare costs.
According to a CDC review of state laws, 15 states and the District of Columbia have enacted at least one statutory provision related to community health workers. A review published by the Harvard Law School Center for Health Law & Policy Innovation, found three states—Ohio, Oregon and Texas—have highly developed regulations governing the profession. Three other states—Alaska, Minnesota and New Mexico—allow Medicaid reimbursement for community health worker services.