Linda M' Lacey

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Measuring Supply and Demand for Healthcare
Professions

• Linda M. Lacey
• President
• Lacey Research Associates

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My background

• 15 years as the Associate Director Research for
  the North Carolina Center for Nursing
• Supply/demand cycle of research
• Extensive use of administrative data
• Primary data collection efforts
• To address supply-side issues the administrative
  data could not
• To collect demand data from employers
• Research Associate with BC/BS of NC
• Research Associate Project Manager with the
  Cecil G. Sheps Center for Health Services Research

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Mission of the Virginia HWDC

• To improve the healthcare system in the
  Commonwealth by
• improving data collection and
• measurement of the healthcare workforce
• through regular assessment of workforce supply
  and demand.

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Mission Implications

• Improve upon current data collection efforts if
  needed
• Accurate and appropriate data collection is
  critical in order to be able to plan for the
  future and provide access to quality healthcare.
• - VA Healthcare Reform Commission
• Align data collection surveys with long-range
  data needs
• Implement data collection strategies that ensure
  data quality and completeness.

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Mission Implications

• Focus on measurement of workforce metrics that
  illuminate where and how people work
• 1. Include these critical elements in survey
  instruments
• Productivity (hours worked)
• Practice location(s) by county
• Practice type
• Personal demographics
• Professional demographics

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Factors affecting supply in the future

• aging out retirement of the baby boomers
• labor productivity - more part-timers?
• New entrants at older ages fewer years in the
  profession / decreased physical ability?
• Poor image of health care as a career choice

• Demographic bottleneck - fewer young workers to
  recruit into anything
• Capacity limits in our education systems
• Bottle-necks created by a shortage of qualified
  faculty

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ROI for high quality supply data

• The ability to track changes in number,
  composition, location, and work behavior in each
  professional group over time.
• A source of Virginia-specific data for
  forecasting
• May reveal unanticipated shifts/trends
• More effective and cost-efficient public policy
• by tracking intervention outcomes applied to the
  education system, recruitment campaigns, loan
  repayment programs, etc.

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Mission Implications

• Regular assessment of supply and demand for
  health professionals means that demand data will
  be needed
• 1. What is demand data exactly?

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Need vs. Economic Demand

• Need A level of care or service that
  traditionally has been or ought to be consumed by
  a population group in order to attain a desired
  health status
• Economic Demand The quantity of services or
  personnel which consumers, insurers, or employers
  are willing to buy at various prices.

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Factors affecting demand in the future

• Population aging - more health care demand
• Sicker patients
• Older patients
• Inability to substitute less knowledgeable labor
• Labor productivity changes

• New technologies or medical discoveries
• Expanding roles outside of the traditional
  practice settings
• The economy
• Government health care payment policies

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Demand data continued -

• Where will the necessary information come from?
• Is there a single source of information for all
  health professions?

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Sources of Demand Data

• Virginia Employment Commission
• Occupational Forecasts by the BLS
• U.S. Census projections
• Forecasting models for both MDs and nurses are
  available through HRSA Bureau of Health
  Professions
• Employer surveys

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ROI for collecting demand data

• Employer surveys
• Industry-specific information based on Virginia
  employers
• Ability to collect exactly the information needed
  to address Virginia policy issues
• Benchmark metrics are valued by employers - e.g.
  vacancy rates, turnover rates, weeks-to-fill,
  etc.
• Ability to do sector and geographic analyses to
  pinpoint problem areas in the Commonwealth
• Ability to match supply characteristics with
  industry sectors to identify potential problems
  areas -e.g. expected retirement rates in
  hospitals vs other employment settings

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Supply and demand comparisons

• What is the best way of assessing shortage,
  surplus or balance in various healthcare
  workforce groups?
• Depends on your philosophy, data availability,
  and/or analysis capabilities

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When is it a shortage?

• Economic Demand model
• When the total number of providers available and
  willing to work at a specific wage is smaller
  than the total number of providers that employers
  or clients want to hire at that wage.

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When is it a shortage?

• Need model
• When the total number of providers available is
  smaller than the total number of providers needed
  to meet the healthcare needs of the population.

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Forecasting the future

• By the time you have current supply data and
  current demand data in hand, it is already out of
  date.
• It tells you where you have been.
• Forecasting is the Holy Grail of workforce
  planning.
• It tells you where you are headed maybe.

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Methods of forecasting supply

• Historical trends
• Manpower to population ratios
• Econometric (through-put) models that examine
  all supply inputs and outputs

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Methods of forecasting demand

• Population ratio methods
• Service targets / standards
• Analysis of service utilization by population
  groups
• Econometric simulation methods

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Bringing it together
The end result is a graph or table that predicts,
in a general way, what can be expected if nothing
changes.
Repetition is important!
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Overview

• Much to do at the beginning
• Success is heavily dependent on strong
  collaboration among stakeholders
• Long-term gains include
• Technology upgrades for some boards
• Better operational and administrative efficiency
• A better informed legislature
• A factual basis for policy and spending decisions
• Regular updates of progress toward policy goals

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Questions?

• Thank you.
• Questions?