Outsourcing Medical Education from Nevada: Costs and Consequences

John Hudak, Ph.D.

Fellow, Center for Effective Public Management

The Brookings Institution

29 September 2014

jhudak@brookings.edu

@JohnJHudak

Requirements Outsourcing

• A product of value• A geographic transfer – Location of origination– Destination

• A cost to location of origination/benefit for destination

Outsourcing & Medical Education

• Every state has healthcare needs• Every state has medical training opportunities• Every state has addition training capacity• Supply & demand of medical professionals– Surplus of medical professionals– Shortage of medical professions

• Results: importing or exporting of medical professionals

Outline

Part I. A Geographic Basis for a New Medical School

Part II. A Healthcare Basis for a New Medical School

Part III. A Funding Basis for a New Medical School

Part IV. Conclusions

A Geographic Basis for a New Medical School

A Geographic Basis for a New Medical School

A Geographic Basis for a New Medical School

A Geographic Basis for a New Medical School

A Geographic Basis for a New Medical School

A Geographic Basis for a New Medical School

A Geographic Basis for a New Medical School

A Geographic Basis for a New Medical School

Allopathic Medical Schools Founded 2000-2013

Medical SchoolYear of

FoundingCentral Michigan University College of Medicine 2013

Western Michigan University Homer Stryker School of Medicine 2012

Oakland University William Beaumont School of Medicine (MI) 2011

Frank Netter School of Medicine at Quinnipiac University (CT) 2010

Florida Atlantic University Charles Schmidt College of Medicine 2010

Hostra University North Shore-LIJ School of Medicine (NY) 2010

Virginia Tech Carilion School of Medicine 2010

The Commonwealth Medical College (PA) 2008

University of California-Riverside School of Medicine 2008

Texas Tech Univ. Health Sciences Center Paul Foster School of Medicine 2008

Florida International University Herbert Wertheim College of Medicine 2006

University of Central Florida College of Medicine 2006

Cleveland Clinic Lerner College of Medicine 2002

Florida State University College of Medicine 2000

A Geographic Basis for a New Medical School

Distance between New & Existing Medical Schools

New Medical SchoolYear of

FoundingNearest Existing Medical School Distance

Central Michigan University College of Medicine 2013 Michigan State University 68Western Michigan University Homer Stryker School of Medicine 2012 Michigan State University 51Oakland University William Beaumont School of Medicine 2011 Wayne State University 27

Frank Netter School of Medicine at Quinnipiac University (CT) 2010 Yale University 9Florida Atlantic University Charles Schmidt College of Medicine 2010 University of Miami 43Hostra University North Shore-LIJ School of Medicine 2010 SUNY-Downstate (Brooklyn) 20Virginia Tech Carilion School of Medicine 2010 University of Virginia 121The Commonwealth Medical College (PA) 2008 Penn State 113Univ. of California-Riverside School of Medicine 2008 Loma Linda University 12Texas Tech University Health Sciences Center Paul Foster School of Medicine 2008

Univ. New Mexico/TX Tech (Lubbock)

272/344

Florida International Univ.Herbert Wertheim College of Medicine 2006 University of Miami 12University of Central Florida College of Medicine 2006 University of South Florida 85Cleveland Clinic Lerner College of Medicine 2002 Case Western Reserve Univ. --Florida State University College of Medicine 2000 University of Florida 149

A Healthcare Basis for a New Medical School

A shortage of medical professionals in Nevada• Family Practice Doctors 47th out of 51 (states + DC)• Pediatricians 46th out of 51• Orthopedic Surgeons 51st out of 51• Ophthalmologists 48th out of 51• Psychiatrists 50th out of 51• OB/GYNs 40th out of 51• RNs 50th out of 51

**Research conducted by University of Nevada School of Medicine, rankings based on measure of medical professionals per 100,000 residents.

A Healthcare Basis for a New Medical School

A Shortage of Medical Training in Nevada• Fewest MD students per 100,000 residents* (Nevada: 9.5 / 100,000;

National Average: 25.8 / 100,000)• Medical residents/fellows per 100,000 residents, Nevada is 46th.

(Nevada: 8.1 / 100,000; National Average: 25.4 / 100,000)• Medical residents/fellows per 100,000 residents in primary care roles,

Nevada is 47th. (Nevada 5 / 100,000; National Average: 12.2 / 100,000)

*Ranking based on states with existing allopathic medical schools

Note: All data drawn from 2013 State Physician Workforce Data Book from the Association of American Medical Colleges (AAMC)

A Healthcare Basis for a New Medical School

An Opportunity for Nevada Medical Training

Silver State Loyalty in Medical Training• 69.2% of Nevada residents in MD programs matriculate in state

• Among people who attend medical school & perform residency in NV, 79% stay to practice in state.– 5th Nationally– National mean: 66.6%

A Funding Basis for a New Medical School

A Funding Basis for a New Medical School

A Funding Basis for a New Medical School

A Funding Basis for a New Medical School

• GME Funding to the States–Medicare & Medicaid Programs– Assistance for Residencies and Fellowships– Largest Funding Source in US– Funding Levels Set by Congress– Bipartisan Reform Bills

• Tuition Dollars (Federal Subsidy)• Program Plans (Private Sources)• Philanthropy (Private Sources)

A Funding Basis for a New Medical School

GME funding per capita, 2005-2009

Year National Average Nevada Nevada's Rank (out of 46)*

2005 $16.06 $4.03 46

2006 $16.05 $4.65 46

2007 $16.43 $5.77 46

2008 $17.02 $6.96 45 (MS)

2009 $17.94 $8.55 44 (NM, MS)*Includes the 45 states with allopathic medical schools + DCNote: Data drawn from the Robert Graham Center [Graham Center Data]

A Funding Basis for a New Medical School

Results of multivariate analysis of GME

funding among all states

Among all states, every additional medical school graduate = +$527,000 in additional GME funds

Among all states, adding a medical school = $41.4 million in additional GME funds

Among all states, data suggests** the addition of a public OR private medical school is associated with a substantial increase in GME funds

**those results do not achieve statistical significance

A Funding Basis for a New Medical School

Results of multivariate analysis of GME funding among states with 3 or fewer medical schools

Every additional medical school graduate is associated with an increase in additional GME funding, though results do not achieve statistical significance

Every additional medical school = $26.1 million in additional GME funding

Every additional public medical school = $19.8 million in additional GME funding

Every additional private medical school is associated with an increase in additional GME funding, though results do not achieve statistical significance

A Funding Basis for a New Medical School

A Funding Basis for a New Medical School

Since 2010, NIH funds to new medical schools, excluding Cleveland Clinic/Lerner School exceeds $57 millionIn 2013:

FAU (2010): $2.25 million FIU (2006): $3.01 million

FSU (2000): $2.17 million CMU (2013): $337,431

UCR (2008): $4.40 million UCF (2006): $5.65 million

Cleveland Clinic/Lerner School (2002): $82.19 million

A Funding Basis for a New Medical School

A Funding Basis for a New Medical School

A Funding Basis for a New Medical School

Additional Types of Funding – HRSA

HRSA Funding per Capita, Mountain West RegionState Grant Dollars per CapitaMontana $139.12 New Mexico $106.93 Idaho $79.55 Wyoming $54.68 Utah $50.67 Arizona $45.09 Nevada $24.69

Note: Includes all active grants in FY2014. Data drawn from NHRSA website.

CONCLUSIONS

• Las Vegas among the most isolated cities in the US for medical training

• Population, healthcare needs, geography, funding levels all suggest a need for an allopathic medical school

• Training doctors in Las Vegas may limit medical brain drain

CONCLUSIONS

• ACA will increase healthcare demand in Southern NV, an area already facing shortages

• A new medical school can create tremendous federal, private market, and private charity opportunities for Las Vegas region

• A new medical school likely increases research-related private market activity and FTEs

CONCLUSIONS

• Federal healthcare funding to Nevada is among the worst in the nation, fitting a trend in federal funding to the state

• Expanded medical training will increase opportunities for research funding

• Reform proposals for Medicare GME funding will help states like Nevada (growing population, political clout)

THANK YOU