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ECONOMICS, EDUCATION, AND POLICY

Five-Year Follow-Up on the Work Force and Finances of United States Anesthesiology Training Programs: 2000 to 2005

From the Department of Anesthesiology, University of Michigan Health System, Ann Arbor, Michigan.

Address correspondence and reprint requests to Kevin K. Tremper, PhD, MD, Department of Anesthesiology, University of Michigan Health System, 1500 E. Medical Center Drive, Ann Arbor, MI 48109-0048. Address e-mail to ktremper{at}umich.edu.

Abstract

BACKGROUND: In the middle 1990s, there was a decrease in anesthesiology residency class sizes, which contributed to a nationwide shortage of anesthesiologists, resulting in a competitive market with increased salary demands. In 1999, a nationwide survey of the financial status of United States anesthesiology training programs was conducted. Follow-up surveys have been conducted each year thereafter. We present the results of the sixth survey in this series.

METHODS: Surveys were distributed by e-mail to the anesthesiology department chairs of the United States Training Programs. Responses were also received by e-mail.

RESULTS: One hundred twenty-one departments were surveyed with a response rate of 60%. The 87% of departments seeking at least one additional faculty had an average of 2.8 faculty open positions (5.5% open positions overall which is down from 9.7% in 2000). Of the 96% of departments that employ certified registered nurse anesthetists (CRNAs) 89% were seeking additional CRNAs, averaging 3.6 open positions. The average department received $4.9 million (or $116,000/faculty) in institutional support. When the portion of this support allocated for CRNA salaries was removed, the average department received $4.1 million (or $95,000/faculty) in institutional support. This is a 16% increase over the previous year. Faculty academic time averaged 17% (where 20% is 1 d/wk). Departments billed an average of 11,320 anesthesia units/faculty/yr. Although the average anesthesia unit value collected was $31, departments required approximately $40/U to meet expenses. Medicaid payments averaged $15, ranging from $5 to $30/U.

CONCLUSION: These results demonstrate the continuing need for institutional support to keep anesthesiology training departments financially stable.

Because of the dramatic reduction in anesthesiology residents in the United States (U.S.) training programs in the late 1990s, there was a resultant reduction in anesthesiologists available for the work force in the early 2000s (1–3). This reduction in the number of trainees finishing residencies produced a competitive market for recruiting and retaining faculty in U.S. anesthesiology training programs. Those market forces resulted in increased salaries, which placed the academic training departments in financial jeopardy. In 1999, the Society of Academic Anesthesiology Chairs/ Association of Anesthesiology Program Directors (SAAC/ AAPD) Council commissioned a survey of U.S. anesthesiology training programs to determine the degree of faculty shortage and the significance of the financial hardship being placed on the training departments (4,5). This survey noted that the average department was nearly 10% short of faculty, and that approximately half of the departments were financially in the red, despite receiving approximately $34,000/yr/faculty in institutional support (5). Over the next 4 yr, follow-up surveys have been conducted which noted that open faculty positions have remained constant, whereas the amount of institutional support has progressively increased to the range of $80,000 to $100,000/yr/faculty (6–8). Because of the magnitude of the institutional support in the most recent 2004 survey, a smaller sub-survey of chief financial officers of academic institutions was conducted, which confirmed these findings (9). The purpose of this current article is to report on the results of the fifth follow-up survey conducted in the Fall of 2005 and to compare these results with the previous 5 yr of data.

METHODS

For the past 5 yr, e-mail surveys have been sent to the program directors of the U.S. anesthesiology training programs (6–8). The follow-up surveys conducted in 2001 through 2004 have focused on: open faculty positions, open certified registered nurse anesthetist (CRNA) positions, the departments’ financial margin, and the amount of institutional support received. In the 2004, and in this current 2005 survey, the amount of institutional support used to support CRNA salaries was also determined. This is important because of the significant resources required to support these salaries. The primary purposes of this 2005 survey were similar to those of the previous surveys; that is, to determine the number of faculty and CRNA open positions in academic training departments and to determine the amount of financial support being provided to those departments by their institutions (Appendix A). The current survey also asks the unit value charged, the average unit value collected, and the number of anesthesia units billed during the academic year. Finally, this survey also requested the unit value received for Medicaid patients. The first survey request was sent by e-mail in September 2005 and reminders were e-mailed approximately every 2 wk for the next 16 wk to nonresponders.

RESULTS

The survey in Appendix A was distributed by e-mail to 121 SAAC/AAPD member department chairs. The overall response rate was 60% (69/115). (Six departments were excluded in the analysis because of their inability to complete the survey because of their department’s financial structure.) The results are presented in Tables 1–7. The average anesthesiology department has 44 faculty and 96% of those departments have an average of 17 CRNAs, Table 1.

Overall, departments provide faculty with 17% nonclinical time (Table 3), where 1 d/wk is considered 20% (Appendix A). Where faculty start their in-house call late in the day, 69% of departments did not count this day as an academic day and 31% did count it as an academic day.

From a financial funds flow perspective, U.S. anesthesiology training programs can be divided into three types: academic medical center model (AMC model) are those with departments within medical schools; budgeted department model (budgeted model) are those departments which are part of a larger clinical enterprise in which the finances are managed; and the independent department model (independent model) are those departments which are structured like private practice groups (5). The financial data from this report are from the AMC and independent model departments. The financial data for the budgeted model departments were incomplete and/or unavailable because these departments cannot provide profit and loss information because of their expense-based budgeting, e.g., county institutions, military facilities, and large clinic practices (4,5). For the purpose of this survey, a full-time faculty (FTE) is an anesthesiologist who is on a department’s budget. For the fiscal year ending June 30, 2005, based on the stated revenue and expense dollars reported, half of the departments had a positive margin of an average of $1,555,000 or $37,100/ FTE, whereas 40% of departments had a negative margin of $1,670,000 or $49,900/FTE. When taken as a whole, departments, on average, had a slightly positive margin of $104,000 or $2400/FTE. All these calculations include institutional support dollars. Table 5 presents the institutional support which averaged $4,900,000 or $116,000/FTE in fiscal year 2005. If the funds provided to the departments to support CRNA salaries are removed, the overall support is reduced to $4.1 million or $95,000/FTE. Table 6 itemizes the support by hospital, medical school, and other. As in previous years, the largest portion of support is provided by hospitals ($3,523,000), whereas by medical school and others are $779,000 and $512,000 respectively.

As noted in Table 7, although the average department charged $81.54/U, the average department collected $31.00/U, or a 38% rate of collection. Medicaid payments average $15.00/U, with a range from $5.00/U to $30.00/U.

DISCUSSION

Given the progressive decrease in percent of open faculty positions over the past 5 yr, it would appear that the shortage of anesthesiology faculty in teaching institutions may be resolving, Table 2. The results of the SAAC Salary Surveys, with respect to open faculty positions, has been used to assess the validity of our current series of financial surveys (5–8). The 2005 SAAC Survey reported 219 open positions (or 2.7 positions/department), which agrees well with our findings of 2.8 open positions per department (personal communication with Rebecca Lovely, University of Florida, Gainesville, FL). The SAAC Salary Survey has also found a progressive decrease in the number of open faculty positions over the past 5 yr, from a high of 3.3 in 2000 to a low of 2.7 positions per department in 2005. Given that both surveys have found the same trend, it would suggest that the shortage of faculty for academic anesthesiology departments is resolving, possibly because of the greater availability of faculty resulting from the increased number of resident graduates or the increased salaries provided by academic departments, or for both of these reasons.

This most recent SAAC survey also found an increase in salaries for academic faculty but at a decreasing rate from previous surveys. According to the SAAC Salary Survey an assistant professor paid at the 50th percentile received $250,000 in 2005, which is a 3.6 increase over the 2004 salary. Previous surveys have noted larger increases. In past years, the salary increases were 7.4% (2003), 8.1% (2002), and 14.2% (2001) for assistant professors. It appears that the salary pressure is decreasing and that the large salary increases of the early 2000s are now decreasing to a rate of increase of other health care providers (10). This decreased salary pressure may translate to a decreased need for institutional support.

The 2005 average institutional support (including CRNA support) has increased to $116,000/faculty, which is a $18,000/faculty increase, (or 18%) over 2004, Figure 1. The University HealthSystem Consortium (UHC) (2001 Oak Brook, IL) is an organization that provides data sharing for academic medical centers. It also provides services to assist university hospitals in benchmarking funds flow between departments, hospitals, and medical schools. In 2005, Dr. David Burnett of the UHC contacted the primary author of our current survey series (Dr. Kevin Tremper) to discuss a concern expressed to him by the chief financial officers of AMCs regarding the validity of the support dollars data. The data from this series of surveys had been used to help determine the appropriate support for anesthesiology departments at some of the UHC member hospitals. Dr. Burnett concluded that a subsurvey could be conducted to provide validation of the financial results of support dollars provided by hospitals to academic anesthesiology departments. He selected 12 large UHC hospital members at random and determined the mean and median support dollars for anesthesiology departments from the chief financial officers. The mean and median of those support dollars were also retrieved from the most recent financial survey of anesthesia department chairs (8). These data were found to be very similar, thereby providing some validation of the hospital support portion of the financial data (9).

View larger version (14K): [in this window] [in a new window]   Figure 1. This figure presents the total institutional support per faculty anesthesiologist full time equivalent (FTE) from the years 2000– 2005. For each year the high and low lines are the 90th percentile and 10th percentile, the edges of the boxes are the 75th and 25th percentile, and the line in the middle of the box is the median value. Note the years 2004 and 2005 marked with an asterisk represent the institutional support per faculty FTE with the Certified Registered Nurse Anesthetists salary support subtracted.

With this support, the average department is slightly in the black (1.5%), although there are still the haves and the have-nots, with 40% of the departments in the red, an average of approximately $50,000/FTE and 50% of departments with a positive margin of $37,000/FTE. Note that the average dollars collected per unit is $31.00, with a wide range of $17/U to $70/U. The Medicaid unit value payment also has a wide range of $5/U to $30/U. At a $17/U, the faculty who bills for 11,500 U will generate an annual income of approximately $200,000, not accounting for the cost of collections, malpractice, or other expenses. Faculty in a department which collects $70/U can generate $805,000/yr.

It is clear that for faculty doing the same work (units billed), some will easily cover their expenses and others will not. The average units billed for faculty for 2005 was 11,320—relatively unchanged from the previous year. (Table 5) The units billed/faculty is not a measure of faculty productivity, but it is more a measure of faculty utilization. It does determine the ability of a faculty member to generate his or her cost. Given the average support of slightly more than $4,000,000/yr, and the average units billed per department of approximately 500,000 U/yr, the average department is receiving a subsidy of approximately $8/U to produce a break-even budget. Given the average collection of $31/U this would imply that the average department needs to collect between $39/U and $40/U to break even. Each department can easily determine their break-even unit value by taking their expense budget and dividing it by the number of units billed per year. This can be compared with the average dollars collected per unit to determine the gap that will require support, unless the utilization of faculty services is improved. Faculties are assigned to operating rooms or other sites to provide anesthesia services. In general, they have little or no control over the workload at the site, which is mostly determined by the scheduling process and the speed of the surgeon (12,13). Assuming that an anesthesia faculty can be the primary determinate of the dollars they generate per year is similar to assuming that an airline pilot is the primary determinant of the occupancy rate or funds generated per flight. It would be useful to determine these financial data on a basis of sites covered (anesthetizing locations), but because this survey did not request the number of operating rooms or sites to be covered, it is beyond the scope of this analysis. Future surveys would benefit from a more in-depth analysis of these types of data.

As in previous years, the institutional support has a wide range and is not normally distributed; but it is progressively increasing, even when the amount which is provided for CRNA support is removed. This willingness of institutions to support departments and faculty salaries should level off as the nationwide anesthesiologist shortage is diminished and academic departments are able to recruit faculty. Given the current graduation rate of trainees and the expansion of services, it is not clear at which point the production rate of anesthesiologists will meet the nation’s needs.

The data found in this survey suffer from the same potential errors as do data from all surveys, including the previous ones in this series. A skewed response population or errors in the respondent understanding the survey questions are two common problems that may affect accuracy. The response rate of 60% in this survey, although less than the others in this series, again compares very favorably with other surveys published by organizations such as the Medical Group Management Association, which reports response rates of 25%–30% (14). In addition to the changing response rates over the past 5 yr of these follow-up surveys, different institutions have responded in each year; therefore, it is difficult to follow specific changes in the respective size of programs and support related to individual program characteristics. For that reason, the data were presented as changes in mean values.

CONCLUSION

We conclude from this sixth survey (5th follow-up survey) that U.S. anesthesiology training programs still require increasing financial support to maintain financial viability. The average academic department is currently receiving $95,000/faculty, which is a 16% increase over the support of just 1 yr ago. This support number is calculated after the dollars being provided for CRNA salaries are removed. Despite this support, 40% of the departments are still functioning with a negative margin. The primary cause of this negative financial status appears to be the large variation in reimbursement for services provided. Although the number of units billed is relatively constant, the reimbursement for those units varies dramatically, making it nearly impossible to generate a recruitable salary in any location where the mix is such that the average amount collected is less than $40/U. In addition, this most recent data suggest the substantial shortage of faculty for anesthesiology departments may be resolving.

APPENDIX A: 2005 FOLLOW-UP SAAC/AAPD SURVEY

Staffing

How many faculty anesthesiologists do you have? _________

(A faculty anesthesiologist who is employed full-time is one regardless of his/her percent of non-clinical time.)

How many open faculty positions do you have? _________

How many CRNAs do you have? _________

How many open CRNA positions do you have? _________

Department Finance (For Fiscal Year Ending June 30, 2005)

What was your department’s ...

1. Total income

(all sources, not including interest or donations)? $_________

2. Clinical Income? $_________

3. Research Income? $_________

What is your annual institutional support for your department from all sources (hospital, medical school, state, etc)

(Do not include pro-fee income, research grant, gift or endowment income.)

How much from the Hospital? $_________

How much from the Med School? $_________

How much from Other sources? $_________

Does your institutional support dollars include funds to support CRNA salaries? () Yes () No

If yes, how much? $_________

What was your department’s total expense? $_________

How many anesthetic units did you bill last year? _________

(e.g., the University of MI billed 780,284 U in FY 2004/05)

Faculty Academic Time

What is the average amount of non-clinical (academic) time per faculty, not counting the day after in-hospital call? (1 d/wk = 20%). _________% (for this calculation, if your faculty start late on the day they are on in-hospital call, count this as an academic day)

If your faculty start late on the day of in-hospital call, do you ordinarily count this day as an academic day? Yes () No ()

Unit Value Charge

What is your unit value charge for anesthesia? _________

What is the average unit dollar amount you collected $_________/unit

(e.g., the University of MI charges $85/U, but collects $32/U on average)

What unit value do you receive from Medicaid? $_________/unit

CRNA Financial Support (Complete Only If You Have CRNAs)

Does your department pay for CRNAs? Yes () No ()

If yes, how many? _________ How much is the total cost? $_________

Does the hospital pay for CRNAs? Yes () No ()

If yes, how many? _________ How much is the total cost? $_________

Footnotes

Accepted for publication December 14, 2006.

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