Journal of Dermatology for Physician Assistants

The official journal of the Society of Dermatology Physician Assistants

Cost-Effectiveness of PA Employment in Dermatology

By Roderick S. Hooker, PhD, MBA, PA

“Are physician associates/assistants (PAs) cost-effective in their employment?” This question has arisen in several situations involving PAs and nurse practitioners (NPs) in various settings and roles. Based on the literature, it seems clear they are cost-effective in primary care and surgery. The list of PA and NP activities in various disciplines and areas of healthcare provision that are cost-effective is long, and each peer-reviewed publication seems to put to rest the question of their value to employers. This is especially true in primary care.1Donald F, Kilpatrick K, Reid K, et al. A systematic review of the cost-effectiveness of nurse practitioners and clinical nurse specialists: what is the quality of the evidence? Nurs Res Pract. 2014;2014:896587. doi:10.1155/2014/8965872Hooker RS, Everett CM. The contributions of physician assistants in primary care systems. Health Soc Care Community. 2012;20(1):20-31. doi:10.1111/j.1365-2524.2011.01021.x The existing body of evidence strongly supports PAs and NPs in general medicine/family medicine as not only cost-effective, but also “cost-beneficial.” PAs and NPs are considered cost-beneficial when they do not negate their wage differential by ordering more tests, incurring more liability, or taking longer in an encounter than a physician, on average. Instead, they produce the same outcome as a physician in the same setting and under the same circumstances but with less than one-half the annual compensation.3Quella A, Brock DM, Hooker RS. Physician assistant wages and employment, 2000-2025. JAAPA. 2015;28(6):56-63. doi:10.1097/01. JAA.0000465222.98395.0c. Sometimes the outcome of care by the PA is better than the physician-matched cohort.4Morgan PA, Smith VA, Berkowitz TSZ, et al. Impact of physicians, nurse practitioners, and physician assistants on utilization and costs for complex patients. Health Aff (Millwood). 2019;38(6):1028-1036. doi:10.1377/hlthaff.2019.00014
The literature on team use involving PAs and NPs is even more striking. While “team” has many definitions, all teams have, at a minimum, two or more members working interdependently towards a common goal.5Everett CM, Docherty SL, Matheson E, et al. Teaming up in primary care: Membership boundaries, interdependence, and coordination. JAAPA. 2022;35(2):1-10. doi:10.1097/01.JAA.0000805840.00477.58 In contemporary studies, it appears that teams that include PAs and NPs can produce even better outcomes than traditional physician-only practices.6Pany MJ, Chen L, Sheridan B, Huckman RS. Provider teams outperform solo providers in managing chronic diseases and could improve the value of care. Health Aff (Millwood). 2021;40(3):435-444. doi:10.1377/hlthaff.2020.01580.

The literature on PA cost-effectiveness has been summarized in a comprehensive systematic review. In works gathered across various settings, spanning five countries, and of many medical and surgical specialties, the result was that PAs are cost-effective employees.7van den Brink GTWJ, Hooker RS, Van Vught AJ, Vermeulen H, Laurant MGH. The cost-effectiveness of physician assistants/associates: A systematic review of international evidence. PLoS One. 2021;16(11):e0259183. Published 2021 Nov 1. doi:10.1371/journal.pone.0259183. In total, 42 papers met review criteria and were extensively evaluated. Remarkably, few displayed significant risks of bias (an exclusion criterion). The bottom line is that PAs are cost-effective, in general, and in a dozen specialties.

Although the dermatology literature was scanned for PAs and many publications reviewed, no labor input or cost-effectiveness study emerged. Some differentiation on melanoma diagnoses by PAs and MDs was reported, which implicated scope of practice and supervision issues of dermoscopy.8Anderson AM, Matsumoto M, Saul MI, Secrest AM, Ferris LK. Accuracy of skin cancer diagnosis by physician assistants compared with dermatologists in a large health care system [published correction appears in JAMA Dermatol. 2018 Jun 1;154(6):739]. JAMA Dermatol. 2018;154(5):569-573. doi:10.1001/jamadermatol.2018.0212. 9Nault A, Zhang C, Kim K, Saha S, Bennett DD, Xu YG. Biopsy use in skin cancer diagnosis: Comparing dermatology physicians and advanced practice professionals. JAMA Dermatol. 2015;151(8):899-902. doi:10.1001/jamadermatol.2015.0173.

Are dermatology PAs cost-effective to their employers? Are they in roles of substitution or as complements? Do they return more revenue than their wages to the private practice entrepreneur, or are they used to improve care throughput in a practice like Kaiser Permanente? In 2012, results from a membership survey conducted by the Society of Dermatology Physician Assistants (SDPA) reported the return on investment is positive.10Thomas E, Coombs J, Kim J, Hyde M. A survey of fellow members of the Society of Dermatology Physician Assistants. JAAPA. 2013;26(2):56. doi:10.1097/01720610-201302000-00011 Self-reported value aside, other questions linger. When employed in the same setting, is there a division of labor between a dermatology MD/DO, PA, or NP? Organizational efficiency experts and managers want to know these fundamental questions for staffing purposes. At the same time, why are PAs and NPs being employed in dermatology practices when the American Academy of Dermatology seems unbracing?

While the answer to this labor economic question remains open, some compelling evidence points in a positive direction. Clearly, after a half century of utilization, if PAs and NPs were not useful to dermatologists, they would not be employed.11Sargen MR, Shi L, Hooker RS, Chen SC. Future growth of physicians and non-physician providers within the U.S. Dermatology workforce. Dermatol Online J. 2017;23(9):13030/qt840223q6. Published 2017 Sep 15. If they produced greater liability than physicians, their role would be checked. On the other hand, if demand is outstripping the supply, contemporary adjustments need to be made to meet this demand. What is clear to this observer is that dermatology services are increasing because of PAs and NPs working in this domain.12Laughter MR, Maymone MB, Presley CL, et al. Advanced practice providers and the dermatology literature: a bibliometric analysis of trends 1973–2018. J Dermatol Nurses Assoc. 2021;13(5):258-264. Whether this growth will catch up with the theoretical demand of the next decade remains for more granular data.

How productive are dermatology PAs? Are they taking undifferentiated patients as the next dermatology request, or are they managing what is handed to them (referred to as a ‘hand-maiden’ role)?13Aldredge LM, Young MS. Providing guidance for patients with moderate-to-severe psoriasis who are candidates for biologic therapy: Role of the nurse practitioner and physician assistant. J Dermatol Nurses Assoc. 2016;8(1):14-26. 26. doi:10.1097/JDN.0000000000000185. Which type of provider is producing the best ‘compensation to production ratio’? How satisfied are patients with dermatology PAs? Are there differences in outcomes of care when each type of dermatology provider is compared? Does a PA or NP certified by any agency improve compensation or serve as a requirement of employment when the longitudinal outcomes of care by these three providers of dermatology have not been quantified?

Americans sit on a rich tranche of data to answer many fundamental medical questions. Countrywide, the records reside in large databanks at the National Center for Health Statistics (https://www.cdc.gov/nchs/index.htm), Medical Group Management Association, Kaiser Permanente, and others. Locally, each practice produces an electronic record that characterizes the clinician, the patient, ICD code, CPT code, prescription, RVUs, and length of visit. An individual in a small practice or an administrator in a large setting like the Veterans Health Administration could easily download these data. Questions to ask include, “What is the annual productivity of a dermatology PA, and how does he or she compare to a physician? Are there statistical differences in out-comes of care?”

The value of publishing such data is it serves as a historical marker on the development and evolution of PAs and their benefit to society. One of the more critical outcomes of the investigation of PAs has been that they are cost-effective in many roles. In general, they produce a social good that would not be served given a scarcity of physicians.14Hooker RS. Do physician assistants provide a “social good” for America?JAAPA. 2009;22(9):12. doi:10.1097/01720610-200909000-00002 To this end, I believe the role of dermatology PAs should be more than superficially known if they are to be valued by all parties and masters of their societal role.

Roderick S. Hooker, PhD, MBA, PA, is Adjunct Professor of Health Policy at Northern Arizona University in Phoenix, Arizona.

Disclosure: The author has disclosed no potential conflicts of interest, financial or otherwise, relating to the content of this article.

References

  • 1
    Donald F, Kilpatrick K, Reid K, et al. A systematic review of the cost-effectiveness of nurse practitioners and clinical nurse specialists: what is the quality of the evidence? Nurs Res Pract. 2014;2014:896587. doi:10.1155/2014/896587
  • 2
    Hooker RS, Everett CM. The contributions of physician assistants in primary care systems. Health Soc Care Community. 2012;20(1):20-31. doi:10.1111/j.1365-2524.2011.01021.x
  • 3
    Quella A, Brock DM, Hooker RS. Physician assistant wages and employment, 2000-2025. JAAPA. 2015;28(6):56-63. doi:10.1097/01. JAA.0000465222.98395.0c.
  • 4
    Morgan PA, Smith VA, Berkowitz TSZ, et al. Impact of physicians, nurse practitioners, and physician assistants on utilization and costs for complex patients. Health Aff (Millwood). 2019;38(6):1028-1036. doi:10.1377/hlthaff.2019.00014
  • 5
    Everett CM, Docherty SL, Matheson E, et al. Teaming up in primary care: Membership boundaries, interdependence, and coordination. JAAPA. 2022;35(2):1-10. doi:10.1097/01.JAA.0000805840.00477.58
  • 6
    Pany MJ, Chen L, Sheridan B, Huckman RS. Provider teams outperform solo providers in managing chronic diseases and could improve the value of care. Health Aff (Millwood). 2021;40(3):435-444. doi:10.1377/hlthaff.2020.01580.
  • 7
    van den Brink GTWJ, Hooker RS, Van Vught AJ, Vermeulen H, Laurant MGH. The cost-effectiveness of physician assistants/associates: A systematic review of international evidence. PLoS One. 2021;16(11):e0259183. Published 2021 Nov 1. doi:10.1371/journal.pone.0259183.
  • 8
    Anderson AM, Matsumoto M, Saul MI, Secrest AM, Ferris LK. Accuracy of skin cancer diagnosis by physician assistants compared with dermatologists in a large health care system [published correction appears in JAMA Dermatol. 2018 Jun 1;154(6):739]. JAMA Dermatol. 2018;154(5):569-573. doi:10.1001/jamadermatol.2018.0212.
  • 9
    Nault A, Zhang C, Kim K, Saha S, Bennett DD, Xu YG. Biopsy use in skin cancer diagnosis: Comparing dermatology physicians and advanced practice professionals. JAMA Dermatol. 2015;151(8):899-902. doi:10.1001/jamadermatol.2015.0173.
  • 10
    Thomas E, Coombs J, Kim J, Hyde M. A survey of fellow members of the Society of Dermatology Physician Assistants. JAAPA. 2013;26(2):56. doi:10.1097/01720610-201302000-00011
  • 11
    Sargen MR, Shi L, Hooker RS, Chen SC. Future growth of physicians and non-physician providers within the U.S. Dermatology workforce. Dermatol Online J. 2017;23(9):13030/qt840223q6. Published 2017 Sep 15.
  • 12
    Laughter MR, Maymone MB, Presley CL, et al. Advanced practice providers and the dermatology literature: a bibliometric analysis of trends 1973–2018. J Dermatol Nurses Assoc. 2021;13(5):258-264.
  • 13
    Aldredge LM, Young MS. Providing guidance for patients with moderate-to-severe psoriasis who are candidates for biologic therapy: Role of the nurse practitioner and physician assistant. J Dermatol Nurses Assoc. 2016;8(1):14-26. 26. doi:10.1097/JDN.0000000000000185.
  • 14
    Hooker RS. Do physician assistants provide a “social good” for America?JAAPA. 2009;22(9):12. doi:10.1097/01720610-200909000-00002

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