Advanced Practice Providers Optimize Efficiency and Improve Financial Performance

For the past six years, more than 60 percent of healthcare organizations surveyed have increased their advanced practice provider population.

Access to primary and specialty care providers remains a key concern in the United States as populations grow, a shortage of physicians continues, and care distribution deteriorates in underserved communities and non-metropolitan areas. It is estimated that there will be a total shortfall any of up to 121,300 physicians by the year 2030, according to new data from the Association of American Medical Colleges.

This shortage will have an effect on quality and performance and allows for potential disruption of the care team, impacting hospital and health system operations.

To help meet this demand for physicians, many hospitals and health systems are rapidly expanding the number of employed advanced practice providers (APPs), making them one of the fastest-growing healthcare workforces. Not only has this workforce more than doubled in the last 15 years, but physician assistants and nurse practitioners were also ranked in 2018 as the third and fourth best overall jobs by U.S. News & World Report.

See related sidebar: Advanced Practice Provider Strategy Improves Results

Studies indicate that APPs can enhance the provision of patient care by helping to improve access, quality, service, and affordability and, as a result, the demand for APPs is at an all-time high (Jackson, G.L. et al., “ Intermediate Diabetes Outcomes in Patients Managed by Physicians, Nurse Practitioners, or Physician Assistants: A Cohort Study,” Annals of Internal Medicine. Nov. 20, 2018, and Hylton, H.M., Scardino, T.G., “ Improving Access to Care: The Physician/Physician Assistant Team – Development of a Lymphoma-Specific Physician/Physician Assistant Team at a Comprehensive Cancer Center,” Physician Assistant Clinics, July 2016, Vol.1, Issue 3, pp. 489-497). 

According to SullivanCotter’s 2018 Advanced Practice Provider Compensation and Pay Practices Survey:

• For the past six years, more than 60 percent of organizations surveyed have increased their APP population.
• Since 2012, employed APP populations have experienced double-digit growth each year with actual growth outpacing projected growth.
• Actual APP compensation has averaged 0.2 to 0.9 percent higher than planned each year since 2012, and in 2017, compensation grew by 3.6 percent.
• In 2018, organizations reported an APP average external turnover rate of 11 percent.

Redefining APP Strategy at Phoenix Children’s Hospital

To tap into the full potential of APPs and design a workforce strategy aligned with organizational goals, organizations must undertake a deliberate and strategic review of the scope of practice, care team role, levels of engagement, governance, and compensation and payment structures for all APPs.

Consider the success of the Phoenix Children’s Hospital (PCH), one of the largest children’s hospitals in the country, ranking in 10 specialties by U.S. News & World Report. The 433-bed facility recognized the need to utilize APPs more effectively to help transform patient care delivery.

Leadership at PCH realized that their APP workforce had grown swiftly and organically without a comprehensive strategy to support its sustainability. This created obstacles regarding recruitment, retention, deployment, and job satisfaction, and left the organization unable to tap into the full potential of their rapidly growing team of front-line providers.

Committed to keeping up with—and getting ahead of—the pace of change in health care, PCH developed and implemented several overarching goals that included optimizing APPs to top of license, developing competitive APP recruitment and engagement strategies, and positioning the hospital as a top physician and APP employer.

The Results

Over a two-year period, the effects of the comprehensive APP strategy were significant as PCH experienced improvements in quality, access, APP retention, and satisfaction. Results included the following:

• 50 percent reduction in time to fill APP positions from 79 to 38.5 days
• APP turnover decreased by an average of 47 percent since 2016.
• Improved APP and physician productivity in multiple specialty areas: 
  • Orthopedics: 197 percent increase in APP wRVUs with no decrease in physician wRVUs. In addition, the efficiencies gained by optimizing the APP role on the care team resulted in a 12 percent increase in surgeries (and accompanying productivity and revenue) with no additional staff. 
  • Gastroenterology: a 50 percent increase in APP wRVUs with slight increase in physician wRVUs as a result of APP optimization. This allowed for a 31 percent increase in APP outpatient visits and a 9 percent increase in physician outpatient visits 
  • Urology: a 31 percent increase in APP wRVUs and more than a 250 percent increase in APP post-operative visits.

As health care continues to evolve and providers expand their APP workforces, the Phoenix Children’s Hospital model can serve as a roadmap for any healthcare organization—non-pediatric or pediatric—to support the critical role APPs play in transforming care delivery, improving performance, and helping to achieve key financial results.

Lessons Learned

This type of workforce strategy also requires alignment of physician and APP compensation programs and is leading to shifts in provider incentive practices. Performance-driven compensation strategies should be customized to the unique needs of each organization and are a critical component of a comprehensive APP workforce plan.

Other lessons learned during this strategic process at PCH included a clear set of principles for successful program development and implementation: 

• Define team-based care models based on patient needs and clinical specialty
• Ensure clinicians work to their full potential and support top-of-license practice
• Build a culture and infrastructure to support integration, retention, and engagement of APPs
• Measure progress to ensure sustainability
• Develop a clinical workforce plan that includes all members of the care team
• Consider implementing an integrated physician and APP compensation program 

The APP workforce continues to grow and plays a critical role in transforming care delivery and enhancing organization-wide performance, and APP workforce strategies must be tailored to support not only optimization of the entire clinical team, but organizational financial sustainability as well. If brought on board strategically, effectively utilized and integrated into the system, APPs can be a key component in addressing physician productivity, driving long-term performance and improving access, quality, service and affordability.