U.S. Physician Charity Care Continues Decade-Long Decline

2 out of 3 Doctors Provide Charity Care in 2004-05 -- Down from 3 out of 4 in 1996-97

News Release
March 23, 2006

FURTHER INFORMATION, CONTACT:
Alwyn Cassil (202) 264-3484 or [email protected]

WASHINGTON, DC -- The share of U.S. physicians who provided charity care fell by 8 percentage points over the past decade, declining to 68 percent of physicians in 2004-05 from 76 percent in 1996-97, according to a national study released by the Center for Studying Health System Change (HSC).

The decline in physician charity care took place as the number of uninsured Americans climbed to 45.5 million in 2004, signaling mounting stress on the health care safety net.

"The decline in physician charity care -- long a critical part of the safety net -- is alarming given the increase in the number of uninsured Americans," said Paul B. Ginsburg, Ph.D., president of HSC, a nonpartisan policy research organization funded principally by The Robert Wood Johnson Foundation.

The percentage of physicians offering any free or reduced-cost care dropped to 68.2 percent in 2004-05 from 71.5 percent in 2000-01, extending a trend that dates to at least 1996-97, when 76.3 percent of physicians provided charity care, the study found. Despite a decrease in the share of physicians providing charity care, the absolute number of physicians offering such care remained relatively steady because the overall number of U.S. practicing physicians grew from about 347,000 in 1996-97 to 397,000 in 2004-05.

But the volume of physician charity care relative to the number of uninsured declined, with charity care hours per 100 uninsured people falling from 7.7 hours in 1996-97 to 6.3 in 2004-05 -- an 18 percent decrease. Most of this reduction occurred after 2000-01, primarily because of the large increase in the uninsured population, from 39.6 million in 2000 to 45.5 million in 2004.

"Already, there are signs that uninsured Americans are having more problems getting care, and if the decline in physician charity care continues, those problems are probably going to get worse," said HSC Senior Researcher Peter J. Cunningham, Ph.D., coauthor of the study with HSC Health Research Analyst Jessica H. May.

The study concludes that persistent financial pressures and shifts in physician practice arrangements may partly account for the continuing decline in physician charity care.

Based on HSC's nationally representative Community Tracking Study Physician Survey, the study's findings are detailed in a new HSC Tracking Report -- A Growing Hole in the Safety Net: Physician Charity Care Declines Again. The 1996-97 and 2000-01 surveys contain information on about 12,000 physicians, and the 2004-05 survey includes responses from more than 6,600 physicians. Response rates for the surveys range from 52 percent to 65 percent.

Other key study findings include:

Physician Specialty

The share of physicians providing charity care declined across all major specialty groups, geographic regions, and in both urban and rural areas. Surgical specialists were the most likely among specialty physicians to provide charity care, probably because many are required to be on call at hospitals and encounter many uninsured patients who need emergency services. Pediatricians were the least likely to provide charity care, perhaps reflecting the fact that fewer children lack insurance because of more generous public coverage eligibility.

Practice Characteristics

Levels of charity care were highest among physicians in solo or small group practices and those who were full or part owners of their own practice. About 80 percent of physicians in solo practice or small groups -- 10 physicians or fewer -- provided charity care in 2004-05, and this had not changed significantly since 1996-97. By comparison, physicians in larger groups and institutional-based practices (i.e., medical schools or hospitals) were much less likely to provide charity care, and charity care among these physicians declined sharply between 1996-97 and 2004-05. During the same period, the percentage of physicians in solo or two-physician practices dropped from 40 percent to 31 percent, while the percentage in large groups, hospitals, and medical schools rose from 21 percent to 26 percent.

Physician Income

Provision of charity care declined for physicians at all income levels. Physicians with the highest incomes continued to report the greatest provision of charity care, with 75.6 percent of physicians with practice incomes exceeding $250,000 providing charity care in 2004-05, compared with 66.4 percent of physicians earning less than $120,000.

The Center for Studying Health System Change is a nonpartisan policy research organization committed to providing objective and timely research on the nation's changing health system to help inform policymakers and contribute to better health care policy. HSC, based in Washington, D.C., is funded principally by The Robert Wood Johnson Foundation and is affiliated with Mathematica Policy Research, Inc.

Sources and Further Reading

U.S. Census Bureau — Health Insurance Coverage Data — The uninsured population estimates cited in this study (39.6 million in 2000 to 45.5 million in 2004) are derived from Census Bureau data, providing context for the growing demand for physician charity care.

AMA — Physician Practice Arrangements — The AMA master file was used as the sampling frame for the Community Tracking Study Physician Surveys. The AMA also tracks shifts in physician practice arrangements, including the trend from solo practice to larger groups discussed in this study.

CMS — Provider and Supplier Enrollment — CMS tracks the number of practicing physicians nationally. This study references the growth from 347,000 to 397,000 physicians during the study period, which offset some of the decline in the charity care participation rate.

Robert Wood Johnson Foundation — RWJF was the principal funder of HSC and the Community Tracking Study Physician Surveys spanning 1996-97 through 2004-05 that provided the data for this study.

KFF — The Uninsured and the ACA — KFF publishes research on the uninsured population and access to care, providing context for the growing safety-net pressures that accompanied the decline in physician charity care documented in this study.