Turmoil in HealthCare: Will Blacks seize the industry’s emerging professional and business opportunities?
This summer, thousands of African-American physicians and other health-care professionals will meet in San Diego, Calif., for the 102nd Annual Convention and Scientific Assembly of the National Medical Association (N.M.A.), the nation’s oldest and largest organization of Black doctors. The mood likely will be far from festive. Aside from its usual scholarly exchange of opinion on medical advances, the gathering is certain to tackle a startling shift in the federal government’s health-care focus that emerged with the release in December of the “National Healthcare Quality Report” and the “National Healthcare Disparities Report.” Prepared by the Department of Health and Human Services’s Agency for Healthcare Research and Quality, the reports are the first comprehensive effort to measure the quality of health care in America and differences in access to health-care services for so-called priority populations nationwide.
Randall W. Maxey, M.D., N.M.A.’s current president, has already sounded his organization’s alarm. “We are perplexed that the two reports released today appear to shift the focus away from the goal of eliminating health-care disparities. The new focus has as its premise ‘increase health-care quality for all,’ with health disparities based on race and ethnicity all but disappearing,” he told reporters on Dec. 22, the day the reports were released.
The disparities are grave. African-Americans, for example, experience higher death rates from heart disease and stroke than whites and are two times more likely than whites to have diagnosed diabetes. African-American women are more likely to die of breast cancer than women of any other race or ethnicity, African-Americans 65 years and older are less likely than whites to report having received flu and pneumonia vaccines, and African-American infants have a higher mortality rate than white infants.
Such disparities signal a health-care system in deep trouble even as it boasts the most scientifically advanced services in the world and accounts for more expenditures (more than $1 trillion annually) than that of any other nation. Public health activists point to excessive costs, government cutbacks, soaring numbers of uninsured Americans and inadequate investment in the continuum of health care as further proof of an ailing system.
With the fallout acute in African-American communities, and some 75 million demanding baby boomers about to come of Medicare age, health care can be a boon to Black professionals and entrepreneurs alike. Opportunities range from careers in education, management and medical practice to providing goods, such as medical supplies and surgical equipment; services, such as transportation, staffing and facility maintenance; and home- and clinic-based care, including alternative medicine. The N.M.A. notes that African-Americans comprise only 3.7 percent of the country’s physicians, roughly the same percentage as practiced 75 years ago.
Health services are one of the largest and fastest growing industries in the country. Not only will they account for 13 percent of all wage and salary jobs created between 2000 and 2010, but nine out of 20 occupations projected to grow the fastest also are concentrated in health services, the Bureau of Labor Statistics reports. “The elderly population, a group with much greater than average health-care needs, will grow faster than the total population between 2000 and 2010, increasing the demand for health services, especially for home health care and nursing and personal care. Medical group practices and integrated health-care systems will become larger and more complex, increasing the need for office and administrative support workers,” the Bureau says in its report, “Employment Outlook: 2000-10: Industry Output and Employment Projections.” By 2010, for example, employment of personal and home care aides is projected to increase by 67 percent, medical assistants by 60 percent, physician assistants by 57 percent and medical records and health information technicians by 54 percent.
Industry trends are reshaping not only the nature of the health services work force, but also the manner in which services are provided. Hospital care, for example, is shifting from an inpatient to an outpatient basis to contain costs. The average length of a hospital stay fell to 4.9 days in 2001 from 6.6 days in 1985. Some hospitals have expanded into long-term and home health-care services. Others are contracting out all kinds of services. In a survey in 2000, business advisors Deloitte & Touche found that only 48 percent of hospitals surveyed expect to be stand-alone, independent facilities in 2005, against 61 percent in 2000.
In other trends, more Blacks are using nursing and personal-care facilities. Group practices, where practitioners with the same or different specialties practice together privately, are expanding. Facilities range from clinics and freestanding emergency care centers to ambulatory surgical centers, with physicians and surgeons increasingly coming on board as salaried employees. Offices and clinics of other health practitioners are proliferating, among them chiropractors, optometrists and podiatrists, as well as occupational and physical therapists, psychologists, audiologists, speech-language pathologists and dietitians. They also include alternative-medicine practitioners, such as acupuncturists, homeopaths, hypnotherapists and naturopaths. Hospitals and nursing facilities have begun to contract out for these services.
Similarly, the number of establishments offering allied services is increasing. These are as diverse as kidney dialysis centers, drug treatment clinics and rehabilitation centers, blood banks and providers of childbirth preparation classes. The number of laboratories that provide analytic or diagnostic services is also increasing as hospitals outsource these services. Home health care has become one of the fastest growing areas in the entire U.S. economy, thanks to new in-home medical technologies, patients’ preference for care at home and improved insurance terms. Advances in medical technologies are allowing more complex treatments to be performed on an ambulatory basis, while advances in telecommunications technology has given rise to tele-medicine, the diagnosis and treatment of patients over distances.
Soaring costs and lack of insurance coverage are perhaps the biggest obstacles to the delivery of quality health care. The Kaiser Family Foundation, which tracks health-care issues, reports that average premiums rose nearly 14 percent in 2003, the third year of double-digit increases. Employers are pushing more of the costs onto their workers, raising co-payments and deductibles. Layoffs are also exacting a toll on health benefits. Census figures show the number of Americans without health insurance shot up by 2.4 million in 2002 to 43.6 million, the largest annual increase in a decade. The final tally for 2003 should be even higher because of the weak job market and state cuts in Medicaid programs.
It’s even worse for Blacks. The proportion of Blacks without health insurance rose to 20.2 percent in 2002, higher than the overall national average of 15.2 percent uninsured. And, says the Census Bureau, losses in health coverage are impacting more middle-class and working families. Middle-income households accounted for most of the increase in the number of uninsured. In households with annual incomes of $25,000 to $74,999, the number of uninsured people rose in 2002 by 1.4 Continued on page 35 million to 21.5 million, with the increase most noticeable in the $25,000 to $49,999 bracket.
High insurance costs are also hurting service providers, from doctors to ambulance companies. Liability costs have driven so many obstetrician-gynecologists out of business that the American College of Obstetrics and Gynecology has issued a ‘Red Alert’ in nine states, including New York and New Jersey. “People are giving up practicing obstetrics-gynecology. There is a huge problem attracting young bright medical students to the field. It used to be a premiere specialty. Now it’s almost at the bottom in terms of attractiveness,” complains Louis D. Camillien, chief of gynecology and vice chair, department of obstetrics and gynecology, New York Methodist Hospital, Brooklyn. “Clearly, as you attract less competent, less qualified medical students, it will reflect the quality of OB-GYN in this country in the next 10, 15, 20 years.”
Tight state and federal budgets that limit compensation for providers are exacerbating the situation. “We were fortunate that some of the proposed cuts with most recent budget negotiations in Albany didn’t go through. But it remains a threat. The reimbursement methodology never provides for us the amount we need to meet the costs. So it’s a challenge to make sure that whatever we do get defrays the uncompensated costs we do have,” says K. Candis Best, chief information officer and chief operating officer of the North Brooklyn Health Network, one of the seven networks of New York City’s public health system.
Leslie Allicks, president of Women in Health Management and director of provider advocacy in the Office of Managed Care at New York University Medical Center, says managed health-care programs are an attempt to hold down insurance costs. Comprising mainly preferred provider organizations (P.P.O.’s), health maintenance organizations (H.M.O.’s) and hybrid plans such as point-of-service (P.O.S.) programs, they pay providers set rates for services to patients. “Managed care was developed primarily out of abuses and misuses of our health-care system by the physicians and out of poor consumer knowledge and lack of responsibility on the patient side. There was very little oversight, no real guidelines to make care standard from one doctor to another,” she says. “Americans have this notion that the government is going to pay for everything, that there is this bottomless pit of money for health care, and it’s just not that way.”
But even managed care seems to be part of the problem these days. Ernest Baptiste, vice president and executive director of St. Vincent’s Catholic Medical Center, St. Mary’s Hospital Division, in Brooklyn, says managed care companies are making huge profits at the expense of hospitals. In 2001, managed care companies saw collective profits of $535 million, while hospitals saw losses of $343 million, he says. “Starting in 1998-1999 that’s been the trend. At the end of the day our rates from managed care are going down,” he says.
Allicks concedes that all is not well. “From what I understand, even the H.M.O.’s are reducing the amount of money they are paying doctors, and the amount of input welcomed by the managed care companies is decreasing when it comes to policy decisions and benefit coverage. At this point managed care needs to really involve the providers more because they are the ones who know what the standard of care should be for a particular disease,” she says.
Patients have to be more educated about managed care plans, warns Best. “We’re paying close attention to the transition to managed care and the potential impact on access to care. When people get these letters about managed care plans, they either sign up for a plan that their provider does not take, or they don’t sign up at all. They are auto-assigned to a plan when they don’t sign up on their own and so they risk finding themselves enrolled with a provider that their insurance company does not cover. And it’s not easy to switch,” she says.
The health-care industry is reshaping itself to accommodate sea changes in technology, social demographics and the economy. In the process, new professional and business opportunities are emerging, especially in minority communities. Whether enough Blacks will seize these opportunities to make a significant difference in the state of African-American health care is a serious concern.