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Study Shows Physicians Shying Away from Providing Charity Care

Trend Could Foreshadow Access Problems for Poor and Uninsured People

News Releases
August 23, 2001

Alwyn Cassil: (202) 264-3484

ASHINGTON, D.C.—The proportion of physicians providing charity care dropped from 76 percent to 72 percent between 1997 and 1999, raising concerns that access to care for poor and uninsured people could decline in the future, according to a study released today by the Center for Studying Health System Change (HSC).

While the overall number of practicing patient care physicians increased slightly from 347,000 in 1997 to 363,000 in 1999, the number of physicians providing charity care—about 260,000—remained constant, meaning the proportion of physicians providing charity care declined, according to the study. The findings are based on the Community Tracking Study Physician Survey of more than 12,000 physicians and are detailed in a new HSC Issue Brief—Physicians Pulling Back from Charity Care.

"Policy makers should take note that an important part of the safety net—physician charity care—is in danger of fraying," said Paul B. Ginsburg, Ph.D., president of HSC, a nonpartisan policy research organization funded solely by The Robert Wood Johnson Foundation. "If insurance costs continue to rise rapidly and the number of physicians providing charity care declines, access to care for the poor and uninsured will be in jeopardy."

Because the reduction in the percentage of physicians providing charity care was offset by an increase in the overall number of practicing physicians, the impact on medically indigent patients, including the uninsured, was probably negligible, said Marie C. Reed, M.H.S., an HSC health research analyst and lead study author. Additionally, the average amount of charity care supplied by physicians who did provide charity care remained steady at about 11 hours a month.

According to HSC’s Community Tracking Study Household Survey, the number of uninsured persons did not change significantly between 1997 and 1999, and the average number of physician visits reported by the uninsured held steady at two a year—about half as many as people with health insurance.

Recent estimates of physician supply indicate the number of practicing physicians is growing at only about 1 percent a year—a much lower annual rate than the 3 percent in the 1990s—raising the question of whether there will be enough new physicians to offset declines in physicians providing charity care, especially at a time when health care costs are rising rapidly.

"The proportion of physicians willing to provide charity care is shrinking, while demand for charity care is likely to increase if rising health care costs add to the ranks of the uninsured," Reed said.

Three underlying changes in the medical marketplace may explain why fewer physicians are providing charity care:

  • Physicians increasingly are employees of medical practices rather than owners, and employed physicians are less likely—and perhaps less able—to provide charity care than physicians who own their practices.
  • Physicians are under significant financial pressure from lower payment rates following a decade-long effort by health plans and employers to rein in costs, and these pressures may diminish physicians’ capacity to provide charity care.
  • Physicians may have less time to devote to charity care because they are dealing with more administrative burdens from multiple payers and managed care.

Physicians’ willingness to provide charity care is a key component of the nation’s safety net. While HSC’s recently completed site visits to 12 nationally representative communities indicate the safety net in some communities has improved in recent years, there are signs of strain.

Widespread accounts of pressures on hospital emergency departments and academic medical centers indicate that key parts of the safety net may be unable to serve the medically indigent to the extent they have in the past.

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The Center for Studying Health System Change Ceased operation on Dec. 31, 2013.