Physician Assistant

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Are nurse practitioners cost effective?

April 3, 2012 in Nonphysician Clinicians | 5 comments

Nurse practitioners (NPs) are non-physician clinicians that can often either assist or directly provide primary care. Some studies have found that NPs can independently manage 80 percent of patients’ primary care needs. Other studies show that NPs provide high-quality care.

A recent article, however, suggests that NPs may not be cost effective.  This is a curious result because NP salaries are much lower than primary care physicians (PCPs).  Consider the following difference between the hourly wage for  physician assistants compared to family and general physicians.

Drs. Liu and D’Aunno, however, argue that employing a nurse practitioner or physician assistance creates additional cost.  First, the physician often needs to supervise the nurse practitioner.  Physicians who spend time supervising NPs have less time to spend with patients.  Second, some share of patients will have more complex conditions that only the physician will treat.  These patients will have two office visits (first with the NP, then with the physician), but would only have needed one visit if they had seen the PCP initially.  Third, if the NP is underutiliized, then the practice will be paying the NP for little work.

This is not to say that NPs are not cost-efficient.  I believe that increasing the role of the NP can increase efficiency.  The Lui and D’Aunno article, however, does note some of the conditions that are necessary for practices to leverage NPs effectively.

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Wal-mart to be the biggest health retailer in the nation?

November 9, 2011 in Current Events, Nonphysician Clinicians | 1 comment

Hot off the press:

Walmart announced it would stop offering health insurance benefits to new part-time employees, the retailer sent out a request for information seeking partners to help it “dramatically … lower the cost of healthcare … by becoming the largest provider of primary healthcare services in the nation.”

Why would Wal-mart want to provide health care services?  Here are some reasons:

  • Many health care services are high margin.
  • With some exceptions (e.g., Kaiser), most current health care service providers do not take advantage of economies of scale, particularly with respect to information technology (IT) services.
  • Wal-mart could take advantage of their current IT infrastructure to readily create EHR.  In fact, Walmart has offered commercial EHR software & services to healthcare providers since 2009.
  • This effort builds on the success of walk-in clinics at stores like CVS (MinuteClinic).  These efforts increase brand loyalty (people usually have a good opinion of the places they get health care) and increases store traffic.  Further, between 2007 and 2009 retail clinic use increased 10-fold.
  • Wal-mart recently dropped health insurance for its employees.  This could be a public relations mechanism to provide some care to these employees.
  • Wal-mart recently dropped health insurance for its employees.  These people will need low cost primary medical care since insurance won’t cover these services.
  • It could create a service provider which is national in scope an already has an existing distribution network.  Wal-mart has 3,800 stores nationwide that it can use to house these clinical services.
  • Wal-mart already delivers prescriptions drugs through its low cost generics program and Medicare Part D drug plan.

The Wall Street Journal reports that Wal-mart is actively seeking partners for its health care expansion.  I would assume that Wal-mart with staff the clinics with low-cost nurse practitioners (NPs) and physician assistants (PAs).

Although some health reformers have aimed to bolster the role of primary care providers, Wal-mart’s actions may help NPs and PAs who provide primary care while putting competitive pressures on MDs who provide primary care.

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