This piece was created by Las Vegas HEALS and posted in Healthcare Quarterly
Nevada’s economy is growing at a healthy pace, especially when looking at where the Silver State was a decade ago. More than 250,000 new jobs have been created in the state since the recession, a number that will be increasing with the dozens of new projects across the state, including the $1.9 billion Las Vegas Stadium and the $4 million Apple shipping and receiving warehouse in downtown Reno. But despite these promising job growth numbers coming to the state, there is still work to be done. The need for doctors in the state of Nevada is a very real problem, and because of the state’s low reimbursement rates, it’s an issue that won’t be going away anytime soon.
This real problem has dismal numbers, with the state ranking 48th in the country for physicians per capita. Nationally there are about 251 physicians for every 100,000 people, whereas the state of Nevada has just under 200. Las Vegas ranks poorly in the number of specialists and subspecialists, ranging from endocrinologists to oncologists, pediatrics to geriatrics. This problem in Nevada is due to several factors, including population growth, an increase of people with insurance since the Affordable Care Act took effect, a lack of graduate medical education (GME), and poor doctor reimbursement rates.
Graduate Medical Education
Having the opportunities for graduate medical education as well as seats in the classroom is key in fixing the doctor shortage problem in Nevada. According to Doug Geinzer, chief executive officer of Las Vegas HEALS, a nonprofit, membership-based association whose mission is to foster strategic alliances in the health care community, “we have doctor shortages across all areas, it’s not just in one particular specialty. An area that compounds the problem is that, as a region, we didn’t have significant academic medicine present until recently, but it’s growing now and will create more doctors for our future.”
Touro University, Nevada’s largest medical school, recently expanded its medical school from 135 students to 181 students due to its large number of applications; and UNLV’s medical school will be welcoming its second class of 60 students in July. Even with the graduate medical education expansion, including having residencies in almost every valley hospital, the state is lacking in graduate medical education opportunities, so that poses the question: Where will all these medical students go once they graduate?
“The challenge we have in the state is not the number of medical schools or medical students, it’s the lack of residency programs which are commonly known as graduate medical education,” said Shelley Berkley, Touro University chief executive officer and senor provost. “Our students who graduate from medical school have to leave the state in order to satisfy their 3-year residency requirements.”
A residency is a stage of graduate medical training for new doctors in which they practice medicine under the supervision of a hospital or clinic. The average residency lasts three years, and the students practice in their chosen specialty, such as emergency medicine or pediatrics. States typically have 40 residents per 100,000 people, but Nevada has somewhere between 12 and 14 residencies per 100,000. Funding for graduate medical education comes out of the Medicare fund from the federal government. A number of years ago, Congress put a cap on graduate medical education in order to attempt to balance the federal budget. For growth states such as Nevada, this action proved to be devastating, as there was no funding to create additional residency spots and no place to obtain additional funds. Fast forward to two legislative sessions ago, Governor Brian Sandoval announced that $10 million will be distributed throughout the state to expand graduate medical education opportunities.
“The legislature and Governor Sandoval have been helpful in providing resources to help create residency programs in the state, but it is just the tip of the iceberg,” said Berkley. “If we want to actually keep young future doctors from leaving town and leaving the state, we have to provide a dramatic increase in residency programs to keep them here. What is so troubling is that national statistics demonstrate that 70 percent of doctors end up practicing where they do their residency, so unless the student has strong ties to Nevada, if they are forced to leave in order to satisfy their residency requirement, 70 percent are not coming back. So right now, we are educating a whole lot of future doctors to practice someplace else.”
Population growth and low reinbursement
Low reimbursement rates are another reason that Nevada can’t seem to retain doctors. “Doctors are in high demand wherever you go in the country — there are shortages, it’s not just in Nevada. However, when these students get out of medical school, most are saddled with somewhere between $175,000-$225,000 of student loan debt,” said Geinzer. “Medical school garners the highest level of school loans, so these doctors have to earn a good living, therefore they need to be reimbursed at adequate levels or they can’t pay their student loans. Doctors can earn 20 percent more in the neighboring Southwest states, which will allow them to service their student debts a lot quicker.”
There is a common myth that all doctors’ wages come easily to them, and they spend their days on the golf course. However, doctors’ salaries are based on how much they get reimbursed from the insurance companies for services they perform, and those reimbursement rates vary by state. A doctor’s compensation is directly tied to reimbursement, and Nevada is one of the worst reimbursed states in the country, with Medicaid being the provider with the lowest reimbursement rates. In 2013, Gov. Brian Sandoval expanded Medicaid, and the number of enrollers in the state doubled from 320,000 Medicaid utilizers to 650,000. As supportive as the medical community has been about this expansion, the state’s reimbursement rates did not go up, so doctors are seeing triple the number of patients using the payer that reimburses the least in the state, Geinzer noted.
Todd Sklamberg, chief executive officer of Sunrise Hospital and Medical Center, said, “within the state of Nevada, Medicaid reimburses acute care hospitals across the state at 57 percent of our cost, not our charges, but the cost to provide care. Since 2001, there has been one increase in 2015, so over the last 17 years there has only been one rate increase. If you assume an inflation rate of 3 percent annually, our costs in this timeframe have gone up by almost 50 percent with no increase in the reimbursement. Sunrise Hospital specifically gets reimbursed half our cost — it’s a challenge.”
On the private practice end of the spectrum, the low reimbursement rates affect the level of care that patients receive due to the lack of doctors in primary care. “One of the things that happens with low reimbursement rates is physicians in primary care tend to see more patients per hour than they can easily accommodate,” said Dr. Howard Baron, president-elect of the Nevada State Medical Association. “What ends up happening is when physicians are overbooked in their primary care clinic, they end up making referrals to specialists for things that may have been able to stay in primary care in other states. Primary care doctors don’t have enough time per patient to do extended visits to take care of things that are more medically complex. With the influx of patients, the specialists get overwhelmed with problems that don’t always require specialty care, and then that drives up the cost and time for the patients, and also decreases the satisfaction of the service, so it’s a whole vicious cycle.”
Medical professionals agree that something has got to give in Nevada when it comes to reimbursement rates. “If we don’t get the reimbursement part of the equation right, we’re going to find ourselves in a place where our taxpayer dollars are going to be supplementing training doctors to go to other states to work, which is not what we want to happen,” said Geinzer.
The Future of Health Care in Nevada
Although health care has faced challenges in Nevada for years, significant efforts are being made to fix the problem including bringing top-of-the-line medical entities to the state, such as the new VA hospital, Roseman University and the Cleveland Clinic Lou Ruvo Center for Brain Health. Medical professionals also believe that just by starting the discussion on this topic, changes can be made. “I think having the conversation is a huge start, putting it out there really helps,” said Cleveland Clinic Administrative Director Erick Vidmar. “Bringing players in the market, like the Cleveland Clinic and others, have improved the quality of care provided in Nevada. As we improve quality, people will recognize that quality costs additional money so that will help drive reimbursements up and attract new providers.”
The doctor shortage is not just a Nevada problem. By 2030, studies predict a shortage of more than 100,000 doctors in the United States. Nevada needs to be committed to fix this problem by continuing to fund additional graduate medical education opportunities so the state can produce more homegrown doctors. The reimbursement rates also need to be improved as a way to recruit and retain doctors to the state.
“It has to be a collaborative effort to find a solution to improve reimbursement rates,” said Las Vegas HEALS Chairman of Board of Directors Bob Cooper. “It is a complex, challenging issue, but it’s one that needs to be addressed in order to improve health care for the future. Our organization’s goal is to start this serious conversation as soon as possible with our members and key stakeholders.”