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Health: crossroads over the horizon?

Health: Crossroads Over the Horizon?

The health industry is a major component of the entire service industry and, indeed, of the economy as a whole. As the employer of more than 7 million Americans--including large numbers of minority and women workers--the health industry provides an exceptionally large number of jobs, many of them suitable for entry-level workers and recent graduates. It has also been growing at an astonishing rate. From 1958 to 1982, employment in doctors' and dentists' offices more than doubled, hospital employment tripled, and jobs in nursing homes, rehabilitation centers, clinics run by health maintenance organizations, and other health facilities increased more than fivefold.

It is increasingly apparent that the growth of jobs in the health sector will not continue at this breakneck pace. Many different forces are at work, including far-reaching--some would say revolutionary--changes in the financing and oganization of health care. These are expected to slow overall growth in the industry, affecting some occupations more than others.

Why the industry is changing, what kinds of changes are occurring, and which occupations will be affected most are "front burner' topics for people in the health field. But, due to the industry's size, they should concern almost everyone who deals with career guidance and education planning. The timing and the exact nature of the changes in the health sector are far from clear. People investigating future prospects in this industry should be prepared to assess and reassess developments as they unfold.

Forces for Growth and Containment

Powerful forces for expansion continue to act on the health industry. Pressures to increase the amount and quality of health care are likely to intensify in the years ahead because of the aging of the population, scientific progress, and the tradition of applying advances in medical technology as rapidly as possible. The American public has repeatedly demonstrated that it places a high value on continued improvements in medical care, most of which involve the sophisticated --and expensive--technology of the modern hospital. However, precisely because of the expense, finding ways to slow the rate of expansion of one of the Nation's principal growth industries is, paradoxically, a top priority for government and business alike.

The adverse consequences of continued rapid growth in health care spending are impossible to ignore, and the major purchasers of care--corporations, unions, insurance carriers, and government --are in rare agreement about the need for a change.

Because every dollar spent on health care means a dollar that cannot be spent on something else, controlling health care spending is likely to remain an overriding concern for years to come. The question career planners and counselors need to ask is, "How will health costs be held down?' The answer to that question will suggest which health occupations will offer the best prospects in the years ahead.

More Care for Less Money?

Undoubtedly, management efficiencies could eliminate some fat from the system. But, realistically, costs cannot be controlled simply by eliminating waste. Several different approaches to the problem of controlling growth have already been implemented, however, and others are being discussed. Among these methods are placing moratoriums on the construction and expansion of facilities; restricting the purchase of expensive equipment such as CT scanners; mandating second opinions prior to surgery or hospitalization; requiring that preoperative diagnostic workups be done before a patient is admitted into the hospital; revamping the way hospitals, physicians, and other providers are paid; and increasing the patient's share of the bill for health insurance and hospitalization.

With regard to construction, many States have tried to limit Medicaid outlays for nursing home care by controlling the number of beds in nursing homes over the last decade. Increases in the number of nursing home beds have been prohibited outright for short periods of time. New construction of these facilities has, in fact, slowed markedly. But the moratoriums have not been the major reason for the change; much more important in this predominantly for-profit industry has been the level of reimbursement by State Medicaid programs, which has barely kept pace with costs, making investment in nursing homes less profitable than it used to be.

Medicare's "prospective payment' system was introduced by law in 1983. An ambitious effort to control hospital costs by changing the way hospitals are paid for the services they provide, it could result in the most fundamental change in the delivery of health care since the advent of voluntary health insurance in the 1930's and the enactment of Medicare and Medicaid nearly 20 years ago.

Under prospective payment, a hospital knows in advance how much Medicare will pay for treatment of a patient with a particular diagnosis. Since the hospital must bear the loss if the cost of treatment exceeds the fixed Medicare payment, the hospital benefits by being selective about the patients it admits, by discharging patients as soon as possible, and by making greater use of outpatient facilities-- which are exempt from prospective payment. Hospital stays have declined in the short time the new payment system has been in effect, in part because prospective payment spurs hospitals to provide services, such as laboratory tests and X-rays, on an outpatient basis. Hospitals appear to be taking steps to shorten the average length of stay, increase admissions, shift their caseload away from Medicare, accept fewer charity patients, and offer new, moneymaking services in such areas as home health, wellness and health promotion, and rehabilitation.

Medicare's prospective payment system currently applies only to inpatient hospital care, but experts are trying to develop a way of extending it to care provided by physicians, nursing homes, home health agencies, and rehabilitation facilities. Many State Medicaid programs already use some form of prospective payment. And this new approach to financing health care is widely expected to influence other payers, including the Veterans Administration, the Department of Defense, Blue Cross, and other insurance plans. No part of our health care system is likely to be untouched by its effects.

Different Kinds of Care

Uncertainty as to the methods that will be used to finance health care in the future presents one obstacle to projecting employement. Complicating matters further is the changing nature of care required or desired. Care rather than cure is appropriate for many of the ill; health promotion and disease prevention will be increasingly stressed for the healthy.

The very rapid increase in the number of older Americans will fuel demand for health services for the rest of this century and well beyond. But the health care system, as presently structured, is not well equipped to deal with the problems of the elderly. Most elderly patients need continuing attention to several overlapping, irreversible conditions. Such patients are poorly served by the dominant form of health care, which stresses the high-technology treatment of acute conditions. These patients need long-term care that addresses their psychological, social, and medical needs.

Another factor that could reshape the health industry is the movement to promote good health and prevent disease in the first place. There is a growing consensus about the value of fostering a healthful way of life; identifying and safeguarding against environmental hazards; and detecting genetic, other biological, and nonbiological factors that increase the risk of disease or disability for particular individuals or groups. Three overwhelming reasons have brought about this change: First, it saves lives; second, it improves the quality of life; and third, it may save money in the long run. In an era of cost containment, the notion that a dime of prevention is worth a dollar of cure has broad appeal.

Changes in Organizations

Efforts to control costs, care for the chronically ill, and reduce the risk of sickness are already bringing about change in organizations that provide health care. Once a largely service-oriented nonprofit organizational structure, the health sector is now adopting many of the practices of a profit-oriented industry. Open competition for the health care dollar has led to a new emphasis on consumer convenience (house calls by physicians, mobile dentistry, and 24-hour emergency centers in shopping malls, for example) and to the still novel sight of billboards, newspaper ads, and circulars extolling the benefits of a particular hospital, dentist, or mental health professional.

New organizational entities are flourishing. Health care is still delivered in doctors' and dentists' offices, hospitals, and nursing homes, for the most part. But new delivery systems are taking hold; among them are emergency centers, birthing centers, outpatient surgical centers, and diagnostic imaging centers. Greater diversity in the way health care is delivered and paid for is inevitable, given rapidly rising enrollments in health maintenance organizations (HMO's) and the growing acceptance of preferred provider organizations (PPO's). Private practice by therapists, psychologists, clinical social workers, and other health professionals is becoming more common. This reflects, among other things, patient acceptance of health service providers who are not physicians, successful assaults on laws that made some services the exclusive prerogative of physicians, changes in regulations governing hospital admitting privileges for practitoners, and decisions by third-party payers (insurers, such as Medicare) to reimburse these practitioners.

New approaches to delivering care for the sick and dying are creating new employment settings and job opportunities. The hospice movement, for example, introduced to the United States from England, promotes humane and compassionate care for people who are dying. Hospice programs stress emotional and spiritual support for the patient and the family and dispense painkillers and other drugs to help control the excruciating pain that often accompanies terminal cancer, the disease most often suffered by hospice patients. Approximately 100,000 patients were served by more than 1,300 hospice programs in 1984, according to the National Hospice Organization.

Strong interest in alternatives to nursing home care has produced extremely rapid growth in the home health industry, on the one hand, and has brought forth a variety of community-based facilities and programs, on the other. Community-based programs are as diverse as the communities they serve. Examples include adult day care programs, group homes, and life care communities.

Adult day care programs onganized on a medical model serve severely impaired adults, including stroke victims and patients with Alzheimer's disease. Day care programs organized on a social model generally serve adults who are frail or mildly confused; activities and staffing emphasize recreational, psychological, and social needs. Group homes serve young people and adults who require a supportive environment because of a chronic condition, such as mental illness, mental retardation, developmental disability, or substance abuse. There are some group homes for the elderly, but not many. Life care communities represent a new approach to older people's housing and health needs. Intended for middle- and upper-income residents who can afford the services they provide, life care--or continuing care-- communities offer retirement housing, congregate meals, housekeeping, social amenities, and a guarantee of appropriate health care, no matter what.

Concern for health before people are ill is also bringing about new health organizations. Although public health departments, school systems, and community hospitals will doubtless continue to serve as the focal point for activities to promote health and prevent disease, other sites, including corporate wellness centers and senior centers, are gaining in importance. Growing interest on the part of the business community is evident in corporate wellness centers, fitness programs, and health screening initiatives. Nutritional awareness and exercise programs for older people are increasingly commonplace at senior centers, congregate meal sites, and other community settings.

Changes and Future Jobs

Predicting specific changes and their impact on health careers is impossible. Nonetheless, if cost control remains a central focus of health policy, the consequences for hospital workers in particular can be broadly identified:

Slower job growth due to the shift of much diagnostic and nonemergency care to outpatient facilities.

Loss of some jobs due to hospital closures, consolidations, mergers, and shared-service arrangements.

Reduction in the number of hospital workers in administrative, clerical, food service, and housekeeping jobs due to corporate restructuring and management efficiencies such as contracting-out and centralized recordkeeping, purchasing, marketing, and planning.

Reduced hours and restraints on wages through practices such as voluntary time off without pay.

Shifts in staffing patterns, such as eliminating positions for licensed practical nurses or nursing aides.

Increases in the use of temporaries and work on an as-needed basis.

Hospitals are already searching energetically for ways to cut labor costs, which make up 60 to 70 percent of their budget. Nationally, surveys conducted by BLS and by the American Hospital Association show a decline in hospital employment since 1982. Staffing levels have fallen because hospitals are admitting fewer patients, and patients are leaving the hospital sooner than they used to. These trends are not simply a response to the Medicare prospective payment system. They also reflect efforts to reduce hospital use on the part of State Medicaid agencies and private health insurance plans.

Several studies of the employement impact of prospective payment are underway. The American Hospital Association, under contract to the U.S. Department of Health and Human Services, is collecting data that will permit an analysis of the effects of the new payment system on job duties, staffing patterns, and credential requirements. In addition, a number of associations--among them the American Nurses Association and the American Medical Association --are monitoring the impact of the new system on their members.

The outlook for hospital workers is mixed. Clinical staff, including nurses and respiratory therapists, have been laid off in some places. But most layoffs of clinical staff appear to be in occupations at lower skill levels, notably licensed practical nurse (LPN), nursing aide, and orderly. The new emphasis on outpatient care has spurred demand for discharge planners, home health workers, and rehabilitation personnel. And several recent studies of hospital employment report strong demand for nurses, physical therapists, occupational therapists, respiratory therapists, and radiologic technologists. Prospects should be excellent for workers at the cutting edge of clinical, financial, and information management. Heads of departments--such as nursing, pharmacy, radiology, and other services--and unit managers will need a greater knowledge of financial management because they will be required to control and justify the costs of the services their departments provide.

Prospective payment, which is based on diagnostic-related groups (DRG's), is credited with stimulating demand for physician assistants as well as medical records personnel, because of their importance in limiting costly diagnostic coding errors and in reducing costs. Opportunities for medical records staff inparticular should be excellent because of expanded data requirements, more detailed record analysis, shortened billing time, new quality control measures, shortened time to transcribe reports, increased contact with physicians, and expanded office hours.

Prospective payment has even led to a new administrative specialty and job title: DRG coordinator, who monitors the preparation and submission of the required reports, coordinates the efforts of the various departments such as medical records and nursing, and prepares information on prospective payment for the staff and the community.

Measures to cut costs will almost certainly lead to a shift in staffing patterns. This could mean the emergence of an all-purpose, "multicompetency' technician, trained to perform the work of several different health technologists. Using such personnel rather than more specialized technicians permits greater flexibility in staffing and thus reduces the number of workers on duty. This could heighten demand for registered nurses, since their training enables them to perform some of the tasks now handled by health technologists.

Uncertainty as to future directions in long-term care is another reason why it will be difficult to project the degree of growth in health occupations. The prospect of explosive growth in the population needing long-term care is widely acknowledged, but the issue of financing and delivering that care is being side-stepped at present. All insurers--Federal, State, and private--are extremely reluctant to expand long-term care benefits because of concern about costs.

The changes in the organization and delivery of health care discussed above have implications not only for the number of people employed in the health sector but also for their places of employment, advancement opportunities, wages and working conditions, and labor-management relations.

Patterns of medical practice have already shifted. This is particularly significant for physicians, dentists, and other practitioners, a growing proportion of whom are eschewing solo practice and taking wage and salary jobs in health maintenance organizations, corporations, clinics, and so forth. The trend is in the opposite direction for the traditionally salaried workers--nurses, therapists, psychologists, and social workers--who are increasingly entering private practice, although the overwhelming majority are still wage-and-salary professionals.

The emergence of so-called alternative delivery systems is already shifting employment growth from hospitals to freestanding emergency centers, surgicenters, home health agencies, hospices, and other outpatient facilities.

Changes in the kind of care needed are also affecting employment. For example, the widely perceived need to integrate and coordinate a fragmented long-term care system has heightened interest in case management or care coordination approaches and has led to the creation of community agencies and private firms that specialize in coordination rather than the actual delivery of health care. Case managers work with individual clients and assume overall responsibility for setting up and monitoring a plan of care.

Support remains strong for providing long-term care at home or in homelike surroundings rather than in institutions such as nursing homes, State mental hospitals, or training schools for the mentally retarded. This movement should mean continued growth in the number of halfway houses, group homes, and other residential care facilities. Group homes are staffed by on-site counselors and aides and visited by therapists, physchologists, and other specialists associated with the sponsoring agency. Adult day care programs generally employ rehabilitation and therapy personnel, in addition to administrative, clerical, and food service workers.

Health promotion for middle-aged and older adults appears to be another growth area. Business firms and hospitals have taken the lead in setting up health education and health screening programs. Concern with exercise and physical fitness will continue to generate jobs in a wide variety of settings. Health promotion and disease prevention offer attractive opportunities for teaching, consulting, and innovative programming by practitioners other than physicians, such as nurses, nutritionists, psychologists, therapists, and exercise physiologists.

Keeping Information Up to Date

The effects of these changes on job opportunities in the health industry is unclear. For jobseekers, training programs, and employers alike, there are more questions than answers right now. Career and guidance counselors will find this a confusing time, and they should prepare themselves for contradictory assessments of job prospects.

One important unknown is the matter of supply. Job outlook after all, reflects the relationship between the number of job openings and the number of people seeking to fill those openings. To the extent that new graduates are a major source of supply--as in the case of medicine, dentistry, nursing, and many allied health occupations--fewer students preparing to enter the health field would mean less competition and more favorable job prospects, other things being equal. In fact, enrollments in health curriculums may well decline, given demographic trends, cutbacks in student aid, and a highly uncertain financial environment for hospital-based training programs. Programs that contract with hospitals to provide clinical training for their students are adversely effected by Medicare's prospective payment system, and a number of programs have reduced class size or closed altogether.

Ultimately, job outlook in the health sector will depend on how closely supply (which may grow more slowly than in the past) matches demand (which assuredly will grow more slowly than in the past.) Complicating matters further, future trends in supply as well as demand will vary by employment setting, occupation, skill level or specialty, and geographic region.

Counselors trying to keep up with changes in their own communities will need to strengthen their relationships with local employers and training programs. Continuing contact with hospitals, health maintenance organizations, home health agencies, public health departments, and medical societies should keep counselors informed on changing needs.
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Author:Kahl, Anne; Clark, Donald E.
Publication:Occupational Outlook Quarterly
Date:Jun 22, 1985
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