The Cost of Losing a PhysicianThe Cost of Losing a Physicianin a Rural Communityin a Rural Community

ByByGerald A. DoeksenGerald A. Doeksen

Regents Professor and DirectorRegents Professor and DirectorNational Center for Rural Health National Center for Rural Health

WorksWorksPresentation at Hawai’i State Office of Rural Health Meeting, “Achieving Quality Through Change,” October 24-26, 2007,

Waikoloa, Hawai’i

H

W Rural Health WorksR National Center for

Objectives:Objectives:I.I. To provide three tools useful in To provide three tools useful in

measuring physician needs and impacts measuring physician needs and impacts on a Local Economyon a Local Economy

1)1) Estimate the number of primary care Estimate the number of primary care physicians a rural area can supportphysicians a rural area can support

1)1) Estimate the economic impact of a Estimate the economic impact of a rural physician on local economyrural physician on local economy

1)1) Project needs for specialists in a rural Project needs for specialists in a rural areaarea

II.II. To estimate economic impact of Kaua’i To estimate economic impact of Kaua’i Veterans Memorial Hospital & West Veterans Memorial Hospital & West Kaua’i Clinics on local economyKaua’i Clinics on local economy

1)1) Estimate the number Estimate the number of primary care of primary care physicians a rural physicians a rural area can supportarea can support

I.I. To provide three tools useful in To provide three tools useful in measuring physician needs and impacts measuring physician needs and impacts on a Local Economyon a Local Economy

TotalAge Population Visit Rate Visits Population Visit Rate Visits Visits

Under 15 882 2.5 2,205 833 2.4 1,999 4,20415-24 782 1.2 938 751 2.2 1,652 2,59025-44 1,270 1.5 1,905 1,203 3.2 3,850 5,75545-64 1,089 3.3 3,594 1,135 4.2 4,767 8,36165-74 310 6.0 1,860 357 6.4 2,285 4,14575+ 207 7.7 1,594 319 7.1 2,265 3,859Total 4,540 12,096 4,598 16,818 28,914

Local Primary Care Physician Office Visits (58.9%) 17,030

Male Female

Annual Primary Care Physician Office VisitsGenerated in the Example Medical Service Area

PRIMARY MEDICAL SERVICE AREA

Usage Level 70% 80% 90% 100%

Primary Care Visits 11,921 13,624 15,327 17,030

Number of Primary Care Physicians 2.4 2.8 3.1 3.5

Primary Care Physician Shortage 0.4 0.8 1.1 1.5

Primary Care Physician Office Visits and PhysicianShortages for Different Local Usage by Residents

in the Example Medical Service Area

2)2) Estimate the economic Estimate the economic impact of a rural impact of a rural physician on local physician on local economyeconomy

I.I. Three tools useful in measuring physician Three tools useful in measuring physician needs and impacts on a Local Economyneeds and impacts on a Local Economy

Physician Office ImpactsPhysician Office Impacts

EmploymentEmployment 4 4

Wages, Salaries and Wages, Salaries and BenefitsBenefits

$287,000$287,000

Total Clinic RevenueTotal Clinic Revenue $394,000$394,000

Physician Impact onPhysician Impact onLocal Hospital Inpatient & Outpatient Local Hospital Inpatient & Outpatient

Visits,Visits,Employment, and Wages, Salaries & Employment, and Wages, Salaries &

BenefitsBenefits

No. of Inpatient VisitsNo. of Inpatient Visits 134134

Inpatient RevenueInpatient Revenue $457,000$457,000

Outpatient RevenueOutpatient Revenue $295,000$295,000

Total Hospital RevenueTotal Hospital Revenue $752,000$752,000

EmploymentEmployment 1313

Wages, Salaries, and Wages, Salaries, and BenefitsBenefits

$435,000$435,000

Summary of Physician ImpactSummary of Physician Impactfrom Clinic and Hospital Activitiesfrom Clinic and Hospital Activities

EmploymeEmploymentnt

Wages, Salaries, Wages, Salaries, and Benefitsand Benefits

TotalTotalRevenueRevenue

ClinicClinic 44 $287,000$287,000 $394,000$394,000

HospitalHospital 1313 $435,000$435,000 $752,000$752,000

TotalTotal 1717 $722,000$722,000$1,146,00$1,146,00

00

EstimateSecondary

Impacts

Households

Industry

Basic

ServicesGoods &

$

Inputs

Products

Inputs

$ $

$

$

Services

$ $

Labor

Community Economic System

EmploymentEmployment

Multiplier Total Impact

Clinic 4 1.38 6Hospital 13 1.38 17Total 17 23

Wages, Salaries, and Benefits

Income Multiplier Total Impact

Clinic $287,000 1.16 $333,000Hospital $435,000 1.28 $556,000Total $722,000 $889,000

RevenueOutput

Multiplier Total Impact

Clinic $394,000 1.37 $540,000Hospital $752,000 1.32 $993,000Total $1,146,000 $1,533,000

Total Physician Impact

IN SUMMARYIN SUMMARY

ONE RURAL PHYSICIAN GENERATES:ONE RURAL PHYSICIAN GENERATES:

2323 JOBSJOBS

$889,000$889,000 WAGES, SALARIES & WAGES, SALARIES & BENEFITSBENEFITS

$1,533,000$1,533,000 TOTAL REVENUETOTAL REVENUE

THIS IS A HUGE IMPACT

3)3) Project needs for Project needs for specialists in a rural specialists in a rural area:area:

I.I. Three tools useful in measuring physician Three tools useful in measuring physician needs and impacts on a Local Economyneeds and impacts on a Local Economy

Estimate Medical Specialty Estimate Medical Specialty Physician Service NeedsPhysician Service Needs

Estimate Surgical Specialty Estimate Surgical Specialty Physician Service NeedsPhysician Service Needs

Example ApplicationExample Application

Need for Need for Medical Specialty Physician Medical Specialty Physician

ServicesServicesMedical SpecialtyMedical Specialty Population/Physician Population/Physician

RatioRatio

AllergyAllergy 94,00094,000

CardiologyCardiology 26,00026,000

GastroenterologyGastroenterology 41,00041,000

Hem/OncologyHem/Oncology 47,00047,000

NephrologyNephrology 65,00065,000

NeurologyNeurology 41,00041,000

PulmonaryPulmonary 59,00059,000

RheumatologyRheumatology 86,00086,000

Need for Need for Surgical Specialty Physician Surgical Specialty Physician

ServicesServicesSurgical SpecialtySurgical Specialty Population/Physician Population/Physician

RatioRatio

ENTENT 35,00035,000

GeneralGeneral 13,00013,000

Ophthalmology Ophthalmology 27,00027,000

OrthopedicOrthopedic 17,00017,000

UrologyUrology 34,00034,000

Example of Example of Medical Specialty Physician Services Medical Specialty Physician Services

based on Market Service Population of based on Market Service Population of 9,1389,138

Medical SpecialtyMedical Specialty Number of Specialists Number of Specialists (FTEs)(FTEs)

AllergyAllergy .10.10CardiologyCardiology .36.36GastroenterologyGastroenterology .22.22Hem/OncologyHem/Oncology .20.20NephrologyNephrology .14.14NeurologyNeurology .22.22PulmonaryPulmonary .16.16RheumatologyRheumatology .11 .11

Surgical SpecialtySurgical Specialty Number of Specialists Number of Specialists (FTEs)(FTEs)

ENTENT .08.08GeneralGeneral .62.62OphthalmologyOphthalmology .35.35OrthopedicOrthopedic .48.48UrologyUrology .24.24

Example of Example of Surgical Specialty Physician Services Surgical Specialty Physician Services based on Market Service Population of based on Market Service Population of

9,1389,138

Estimated Days Per WeekEstimated Days Per Week

% FTE% FTE

.10.10

.20.20

.30.30

.40.40

.50.50

.60.60

Days/Days/weekweek

1/21/2

11

1 1/21 1/2

22

2 1/22 1/2

33

Example PhysicianExample PhysicianSpecialty Clinic ScheduleSpecialty Clinic Schedule

SpecialistSpecialist

General SurgeonGeneral Surgeon

Orthopedic Orthopedic SurgeonSurgeon

CardiologistCardiologist

OphthalmologistOphthalmologist

UrologistUrologist

Days per WeekDays per Week

33

2 1/22 1/2

1 1/21 1/2

1 1/21 1/2

11

II.II. To estimate the To estimate the economic impact of economic impact of Kaua’i Veterans Kaua’i Veterans Memorial Hospital and Memorial Hospital and West Kaua’i Clinics on West Kaua’i Clinics on the local economythe local economy

Medical Service Area

Kauai Veterans Memorial Hospital and West Kauai Clinics

Zip CodeZip Code

Area2000

Census2000 ESRI

2006 ESRI

% Chg

2011 ESRI

% Chg

96705 Eleele 1,955 2,161 2,353 2,478

96716 Hanapepe 2,475 2,649 3,032 3,245

96741 Kalaheo 6,277 5,299 5,660 5,918

96747 Kaumakani 607 542 555 572

96752 Kekaha 2,930 3,231 3,330 3,437

96765 Lawai n/a n/a n/a n/a

96769 Makaweli 638 638 622 636

96796 Waimea 2,205 1,663 1,725 1,781

17,087 16,183 17,277 6.8% 18,067 4.6%

Medical Service Areas by Zip Code Population for

Populations

Total MSA

Kauai Veterans Memorial Hospital

Indicator Kauai County State of Hawai'i United States

Per Capita Income (2005) $29,101 $34,489 $34,471

Unemployment Rate (2006) 2.3% 2.4% 4.6%

Unemployment Rate (July 2007) 2.8% 2.9% 4.9%

% of All People in Poverty (2004) 8.6% 9.0% 12.7%% of Under Age 18 in Poverty (2004) 10.4% 10.8% 17.8%

Transfer Dollars as Percentage ofTotal Personal Income (2005)

Economic Indicators for Kauai County, the State of Hawaii, and the Nation

16.7% 12.8% 14.9%

Dollars % of Dollars % of Employment Categories ($1,000) Total ($1,000) Total

Total transfer payments ($1,000) 302,946 100.0% 5,603,084 100.0% Govt payments to individuals 290,780 96.0% 5,363,384 95.7% Ret & disab ins benefit pymts 114,592 37.8% 2,202,523 39.3%

Medical pymts 131,753 43.5% 2,191,382 39.1% Medicare 48,622 16.0% 1,032,782 18.4% Public assist medical care 82,508 27.2% 1,129,486 20.2% Military medical ins pymts 623 0.2% 29,114 0.5%

Income maint benefit pymts 30,322 10.0% 632,192 11.3% Unemp ins benefit pymts 5,332 1.8% 93,217 1.7% Vtrns benefit pymts 7,513 2.5% 196,847 3.5%

State of Hawai'i

Transfer Payments (NAICS) for Kaua'i County and State of Hawai'i, 2005

Kaua'i County

Health Total Full-Time Income

Sector & Part-Time (Payroll plus Benefits)

Component Employment

West Kauai Medical Center 156 $10,716,639

Physician Clinics 38 $1,886,861

Other Medical and Health Services 31 $2,174,668

Total Direct Economic Activities of Kauai Veterans Memorial Hospital and West Kauai Clinics 225 $14,778,168

Direct Economic Activities

of the Kauai Veterans Memorial Hospital and West Kauai Clinics, FY 2007

CommunityEconomic

System

Households

Industry

Basic

ServicesGoods &

$

Inputs

Products

Inputs

$ $

$

$

Services

$ $

Labor

Health Care Number of Employment Secondary Total

Entity Employees Multiplier Impact Impact

West Kauai Medical Center 156 1.38 59 215

Physician Clinics 38 1.42 16 54

Other Medical and Health Services 31 1.42 13 44

Totals 225 88 313

Employment Impact of Health Services

of Kauai Veterans Memorial Hospital and West Kauai Clinics, HI 2007

Health Care Income Secondary TotalComponent Income Multiplier Impact Impact

West Kauai Medical Center 10,716,639 1.24 $2,571,993 $13,288,632

Physician Clinics 1,886,861 1.18 $339,635 $2,226,496

Other Medical and Health Services 2,174,668 1.31 $674,147 $2,848,815

Totals $14,778,168 $3,585,775 $18,363,943

Income Impact of Health Servicesof Kauai Veterans Memorial Hospital and West Kauai Clinics, HI 2007

Other CAH Hospital Other CAH Hospital StudiesStudies

KaKa u Hospital in Pahala, Hawaiu Hospital in Pahala, Hawai i i County County

Hale HoHale Ho ola Hamakua in ola Hamakua in Honokaa, Hawaii CountyHonokaa, Hawaii County

Samuel Mahelona Memorial Samuel Mahelona Memorial Hospital in Kapaa, KauaHospital in Kapaa, Kaua i Countyi County

SummarySummaryI.I. Physician ModelsPhysician Models

1)1) Presented Model to Estimate Presented Model to Estimate Physician NeedsPhysician Needs

2)2) Presented Model to Estimate Presented Model to Estimate Impact of PhysiciansImpact of Physicians

3)3) Presented Model to Estimate Presented Model to Estimate Specialty Physician NeedsSpecialty Physician Needs

II.II. Economic impact of Kaua’i Economic impact of Kaua’i Veterans Memorial Hospital and Veterans Memorial Hospital and West Kaua’i ClinicsWest Kaua’i Clinics

Contact Information:

Gerald A. DoeksenRegents Professor and Director

National Center for Rural Health Worksgad@okstate.edu

405-744-6083

National Center for Rural Health Works

www.ruralhealthworks.orgwww.ruralhealthworks.org

H

W Rural Health WorksR National Center for