3) Employment Opportunities and Conditions -- Challenges for Nurses in a Managed Care Environment

A. Job Loss: Effect of Market Competition on Nurses Employed in Hospitals

Frenzied consolidation of the health care industry, positioning for sudden changes in regional markets, and increasing competition for managed care contracts have led many hospitals to seek aggressive cost-containment measures even though the data confirm that their financial reserves are stronger than ever (Gerstein, 1995). Hospitals want to ensure that they can absorb any short-term financial adjustments needed to offset revenue losses due to deep discounting for new managed care contracts and that they have sufficient revenues for advertising and promotion. Additionally, they want to be able to fund mergers, acquisitions, and other new business arrangements that may become (or appear) necessary in quickly changing markets. Hospitals in the for-profit sector are also under pressure to ensure high levels of return for their investors. As we have seen, these efforts have led to major downsizing, reengineering and job redesign, including cross-training and substitution of cheaper, minimally trained workers for higher paid professionals -- especially registered nurses.

If the actuarials are correct and between 200,000 and 400,000 hospital beds eventually are eliminated, the impact on RN jobs in hospitals will be substantial. Currently, the hospital industry reports RN staffing at about 1.1 RN per licensed, occupied bed per 24-hour period. These two statistics, when taken together, have led some policy makers to conclude that there will eventually be a reduction in the hospital-based RN workforce of between 220,000 and 440,000 jobs (PEW, 1995)

When the managed care market matures to the point where managed care systems compete not only on cost, but on quality of care as well, the demand for RNs will increase. However it is unlikely that the new job opportunities will be created one-for-one to fully offset the number of jobs lost due to the elimination of hospital beds as the industry continues to consolidate. Nurses will need to acquire new skills to assure their marketability in the future. Acquiring and using new information systems and technology will become an essential skill for the nursing workforce. The current nursing workforce will need training and education to stay current of these new technologies

B. New Job Opportunities for Nurses in Managed Care

Many managed care organizations now place an almost exclusive emphasis on cost containment. This is a far cry from the original goals of managed care -- provision of coordinated, seamless services that emphasize prevention and primary care. However in the more integrated and consolidated markets, as managed care price reductions approach their limit, patient satisfaction, provider access, and documentable quality are expected to take center stage (Gerstein, 1995). Many nurses are already identifying important new opportunities to help achieve those goals, as well as creating new roles for nursing. According to the AHA 1995/1996 environmental scan, the greatest health care employment opportunities will be in nonacute care settings, such as home care, primary or custodial care, and case/care management (Gerstein, 1995).

Managed care organizations that value quality and recognize the importance of prevention, wellness, and early intervention can benefit greatly from nurses' expertise in a variety of roles. In turn, nurses can help guide managed care to focus on providing a full range of quality, cost-effective services. In addition to jobs in the more traditional institutional settings such as hospitals, ambulatory, and long term care facilities, some of the fastest growing roles for nurses in managed care include jobs in home care, case management, risk management, patient advocacy, patient education, benefits coordination, and provider liaison (ANA, 1996). Two of the fastest growing areas of job opportunities for nurses are:

(1) Primary Care Provider

Perhaps the most widely identified role for nurses in managed care is that of the primary care provider, the gatekeeper to the rest of the system. Many HMOs already utilize APRNs as primary care providers. Managed care's emphasis on primary care and health maintenance, the current shortage of primary care physicians, and growing chronic care needs are propelling other job opportunities for APRNs and physician assistants (PAs). Managed care corporations are recognizing that APRNs can increase patient access and compliance, are less costly to employ than physicians, and are effective in patient-centered care coordination. They are increasingly accepted by both patients and physicians, so much so that the U.S. Department of Labor predicts a 36 percent increase in these jobs through 2005 to accommodate growing demand. APRNs can provide 60 to 80 percent of basic services performed by primary care physicians (DOL, 1996). Furthermore, according to AHA, more than half of all HMOs are planning wider use of mid-level providers to cope with the primary care physician shortage (Gerstein, 1995).

(2) Demand Management and Telehealth

Opportunities for experienced registered nurses also exist in the rapidly growing area of telehealth, or "demand management services," as it is frequently called in managed care. MCOs increasingly turn to telephone triage and on-line health advice services to reduce members' avoidable visits to health providers. According to the MCOs, this not only helps reduce unnecessary costs, but contributes to better outcomes by helping members become more involved in their own care. Historically, demand for outpatient health care has been largely unmanaged. According to Michael Wood, a consultant with William Mercer, Inc., in Seattle, "The objective of demand management is to help people stay well and obtain the appropriate level of high quality care. Cutting costs is a natural benefit of it." (Bureau of National Affairs, 1996). Consumer satisfaction is also reportedly very high. As a result, MCOs are either buying a demand management program from a vendor or building their own, thereby creating jobs for experienced nurses. Wood advises his clients that nurses must have at least five years' experience in order to bring clinical judgement to each call. For example, Informed Access Systems, Inc., one of several national demand management vendors, employs more than 100 registered nurses -- up from 15 two years ago. The company now handles more than 1 million calls annually and continues to grow rapidly (Bureau of National Affairs 1996).

According to AHA, demand management will receive greater attention in the future, focusing on reducing utilization through programs that support health and medical self-care. About six million people have access to 24-hour telephone health information and counseling services, which coach consumers through care options. "Electronic house calls" that extend health care beyond the borders of physicians' offices are provided by growing numbers of services (Gerstein, 1995).

C. Exclusion of APRNs from Managed Care Plan Provider Panels

The nursing community continues to express concern about some managed care organizations' pattern of excluding APRNs from provider panels. This has the effect, of course, of preventing APRNs from serving as providers for patients enrolled in those managed care organizations. APRNs in some markets have won the opportunity to be managed care providers -- whether through educating the managed care plan administrators, organizing consumer demand, seeking legislation, or other means.

During the 103rd Congress, many non-physician provider groups sought legislation (in conjunction with comprehensive federal health reform efforts) to prevent managed care organizations from excluding whole categories of health care professionals from participating as providers. These efforts were unsuccessful, but provided an opportunity to educate policy makers about the issue of exclusion of classes of health care professionals. These efforts should not be confused with efforts to secure "any willing provider" legislation. "Any willing provider" measures seek to prevent managed care organizations from excluding individual health professionals or providers who are willing to participate as providers, and to accept the managed care organization's conditions for participating. Physician groups, pharmacists, and others have actively sought such measures in many states, often successfully. What nurses have sought, by and large, is legislation to prevent the exclusion not of individuals, but of whole professional categories.

While nurses generally support calls for equal pay among professionals for the same services, some managed care plans may consider this a disincentive to hire nurses if they can hire physicians at the same rate.