Anesthesia Through the Lens of Demographics
Summary: Common wisdom is one thing, but looking at the raw data gives us a more accurate perspective on the reality of the situation. Today's alert dives into the numbers and reveals trends regarding age, gender and case type.
The prevailing view among most anesthesia providers is that their patient populations are slowly aging. According to the Urban Institute, the number of Americans over 65 will more than double over the next 40 years. By 2040, one in five Americans will be of Medicare age, while in 2000, it was one in eight. For most clients, the percentage of patients covered by Medicare and Medicare HMO plans has been increasing by about one percent a year. This growth in older Americans reflects the aging of baby boomers born between 1946 and 1964 during the early post-WWII era. For example, today's new enrollees were born in 1956.
To assess the impact of demographic trends on our clients, we conducted a review of 20 large groups from all across the country based on changing age and gender patterns over a period of five years, from 2016 to 2020. Curiously, the percentage of patients over 65 actually decreased from 2016 to 2020, from 45 percent of the total patient population to 40 percent. This may or may not be good news, depending on one's perspective.
As the chart below demonstrates, there have been year-over-year increases in some patient groups, such as patients from 60 to 70; but decreases in others, such as those over 80. This is consistent with the basic demographic patterns of baby boomers. Of particular note is the dramatic increase in patients aged 50 to 55, those born between 1966 and 1970, which as indicated below is primarily a result of increased utilization of anesthesia for endoscopic procedures and colonoscopies.
Because of the impact of the coronavirus in 2020, there was a 14 percent decrease in total patient volume from 2019 to 2020. This drop notwithstanding, the 2020 numbers are consistent with the trends of the previous four years. What these data clearly show is that the percentage of Americans over 80 who require major surgery is dropping.
Traditional demographic analysis compares both age and sex of patients. For younger populations, many studies have shown that women have higher utilization rates than men during their child-bearing years but that eventually male utilization of medical services overtakes that of women. The reality is actually quite different. Since women tend to outlive men, their utilization of medical services remains strong. In this study, female utilization of surgical services was consistent over the five years at 54 percent.
Of particular interest to anesthesia providers is the mix of services provided. While the dramatic growth in the provision of anesthesia to patients undergoing endoscopic procedures preceded 2016, it may come as a surprise to some to learn that endoscopic anesthesia has consistently represented about 25 percent of all services provided. As the chart below indicates, there was a dramatic increase in patients under 60 getting colonoscopies from 2016 to 2020. Many practices saw a drop in Medicare patients getting colonoscopies in 2020, which is indicated here. Because these were elective procedures, most observers believe this volume will return to normal in 2021.
What is the significance of these insights to the typical anesthesia practice? For many providers, the data presented here is confirmatory in that it documents the gradual erosion of practice revenue potential based on the impact of Medicare and repeated rate reductions and the loss of billable units for endoscopic cases. As an example of the potential impact of this trend, orthopedic cases tend to generate more units per case and may include charges for nerve blocks and ultrasonic guidance. They also tend to be performed on younger patients who are covered by commercial insurance. As the population ages though, there will be an ever-smaller percentage of these cases as the volume of patients being treated for colonoscopies and cataracts increases.
On the other hand, the data indicates a clear predictability to practice patterns. These trends evolve over time. In today's practices, there are very few dramatic developments. These trends should guide the strategic planning of the practice. Essentially, this means that, as we move forward, cost will be the most important determinant of the future success of a practice. Efficiency and productivity of anesthesia providers will be the key to success.
This information also reminds us all of another critical practice management issue. Anesthesia providers are trained to focus on what happens inside the operating room. Each anesthetic is both art and science, designed to create a unique patient experience that optimizes the safety and comfort of the patient. Anesthesia providers do more to enhance the overall surgical experience than surgeons; Versed is a wonderful drug. The problem is that what really determines the income and lifestyle of each provider is not what happens in the O.R. but what happens outside the O.R. Despite their best clinical skills, anesthesia providers are ultimately captive to market trends that are way beyond their control.
If you would like a breakdown of case mix trends by age and/or gender, please contact your account executive. You can also reach us at info@anesthesiallc.com.