Which Way Do You Go?

T en years from now will you still work with managed care organizations? Will you be putting in more hours because fewer dermatologists are around? Will new genetically based drug therapies radically transform the way you treat your patients? Trying to provide definite answers to those and similar questions is, of course, a fool’s errand. But clues exist today that can provide, if not an accurate crystal ball, at least one in which the mist is not quite so heavy. In this article, we’ll offer a view of the major trends shaping dermatology over the next 5 to 10 years and how they might affect your practice. These forces fall into three major areas: social, practice and clinical. SOCIAL FORCES In this first category, your practice is likely to be shaped by the Baby Boomers, a generation that will demand more health care as its members age. But you’ll also feel the power of the “3Ms”: managed care, Medicare and malpractice insurance. Here Come the Boomers As Baby Boomers age, they’ll place a strain on virtually every aspect of the nation’s healthcare system, including dermatology. Dermatology “is going to become very busy in taking care of that patient population,” says Paul S. Cabiran, M.D., of the Department of Dermatology at Ochsner Clinic Foundation, Baton Rouge, LA. Projections from the U.S. Census Bureau provide some insights. From July 2001 to July 2010, the number of residents age 65 and over is projected to increase from 35 million to 39.7 million. But then, in an acceleration of that trend, from July 2011 to July 2020 this population is forecast to grow from 40.4 million to 53.7 million. (See “Projections of U.S. Population Age 65 and Older.”) Many Baby Boomers lead, active, perhaps sun-filled lives, meaning that more of them will likely start showing up in dermatologists’ offices with problems such as skin cancers and actinic keratoses. This bulge of demand may well coincide with a shortage of dermatologists in the future –- an issue we’ll discuss in a few moments. Managed Care: On the Wane? Although managed care still weighs in as a major force in healthcare delivery, its predominant position seems to be on the decline. For instance, the number of full-service HMOs operating in the United States continues to shrink, according to research firm InterStudy Publications. The total number of HMOs dropped to 531 as of July 1, 2001, down from 560 one year earlier. All regions in the country, regardless of changes to HMO enrollment, lost more HMOs than they gained during that time. What’s more, total HMO enrollment continued to decline, says InterStudy, though the rate of decline appears to be slowing. As of July 1, 2001, there were 78 million HMO enrollees, down from 78.9 as of July 1, 2000. (See “Total HMO Enrollment and Growth Rate: July 1992 to July 2001.”) In South Florida, which has always been an advanced market for managed care, says David Wagener, CEO of Skin and Cancer Associates/Center for Cosmetic Enhancement, Fort Lauderdale, FL, HMOs have become more like insurance companies. He sees a move to open access as opposed to tight controls on physician contact. That’s a view shared by Dr. Cabiran, who also sees a trend toward open access where gatekeepers don’t control the system. If managed care is losing its power, what comes after it? Some feel we may see some sort of universal coverage designed to cover catastrophic health issues. Perhaps, surmises Dr. Cabiran, we’ll see a shift from insurance covering virtually every procedure to coverage for major medical events, with more day-to-day expenses handled by the individual payor. “The idea that healthcare is a right that includes coverage for everything, every prescription, every visit is probably doomed to failure,” suggests Phillip Williford, M.D., associate professor of dermatology and director of dermatologic surgery at Wake Forest University School of Medicine, Winston-Salem, NC. “It doesn’t tend to make people act like consumers” except that it makes them simply consume more and more. Some personal cost is needed, he feels, so that the system isn’t inundated by trivial demands. What’s more, where before physicians might have perceived a need to join with every third-party contract, in many areas of the country “that’s not the reality — people have long waiting lists,” says Dr. Williford. Physicians, Dr. Williford notes, are becoming more attuned to business costs. Doctors, he suggests, used to say “I’ll take this crummy contract, but I’ll make it up in volume” — but they can’t make it up on volume if they lose money on every patient. “A lot of people have had this sort of ‘epiphany’ and it may not work everywhere, but I think it’s going to work in a lot of places,” says Dr. Williford. The Mixed Bag of Medicare Subject to the winds of politics, this entitlement program may represent a mixed bag for the future. Casselberry, FL-based consultant Inga Ellzey, CEO of Inga Ellzey Practice Group, Inc., notes that Medicare payments for dermatologists have increased steadily for the past 5 years. In 2002, when many specialty practices saw reductions in reimbursements, dermatologist reimbursements increased 1.7% overall, she says. Practice expense gains in past years are cushioning dermatologists from the full effect of Medicare physician reimbursement dropping 5.4% as of January 1, 2002, says the American Academy of Derma-tology Association (AADA). But without adjustments to this formula, “Dermatologists will begin absorbing significant Medicare payment reductions in 2003 and subsequent years. Some physicians have been forced to stop accepting new Medicare patients because the fee schedule’s reimbursement levels are so low,” the AADA says. The “Medicare Modernization and Prescription Drug Act of 2002,” recently passed in the House of Representatives, provides for a statutory update of 2% starting January 1, 2003. The Baby Boomer generation coming of age along with the potential for programs such as a prescription drug benefit may mean that “Medicare spending is just going to go through the roof,” according to Dr. Williford. The potential for declining payments and reimbursements over the next 10 years is a very real issue, he says. For many physicians in the future, “Medicare will increasingly become a low-pay kind of insurance.” This brings up the prospect of physicians simply not enrolling in the Medicare system (and potentially with other third-party payors) in the first place and moving instead to a cash-only payment system. For dermatologists, where some procedures aren’t that expensive, this may be particularly viable. Such a trend is already noticeable in New York City and North Carolina, says Dr. Williford. Malpractice Poses Threat Meanwhile, malpractice insurance threatens to have a stunning impact on healthcare delivery. Rocketing premiums are encouraging doctors to retire early or simply leave practice. (See “Medical Liability Crisis: A National View.”) Dermatologists are seeing increases of 25% to 40%, and even doubling of premiums, though trends vary state to state, according to Clay J. Cockerell, M.D., clinical professor of dermatology and pathology at the University of Texas Southwestern Medical Center at Dallas and secretary-treasurer of the American Academy of Dermatology (AAD). Times are especially hard for those who do high-risk procedures. Florida-based CEO Mr. Wagener calls the crisis “very real” and one that he doesn’t see going away in short order. Ultimately, the malpractice problem may lead to a crisis in patient access. As doctors leave practice or move to states where malpractice premiums aren’t as onerous, patients may simply have fewer doctors to choose from. The pendulum, says Dr. Cockerell, is swinging so far that one might expect a “major backlash” involving legislation to address the problem. “Because clearly,” he says, “malpractice suits are not the way to regulate and to drive medical care and medical practice.” Mr. Wagener’s 15-office, 20-dermatologist group is becoming “very highly attuned to risk management,” he says. For instance, one staff member has taken a certificate program in risk management. Political activism, suggests Dr. Cockerell, is another avenue for response. (At press time, President Bush had proposed medical liability reform legislation to Congress that included a $250,000 cap on non-economic damages, among other provisions.) PRACTICE-SPECIFIC FORCES Besides these groundswells of social change, you’re going to have to contend with a range of other more specific forces. They include a potential shortage of dermatologists, greater use of physician extenders, shifts from medical and surgical dermatology to cosmetic dermatology, and the regulation of office-based medicine. Shortage Ahead? Baby Boomers’ increasing need for care along with a relatively stagnant number of dermatologists may blend into something approaching the “perfect storm” for the profession. “Despite decades of data suggesting that all specialties were facing severe overpopulation, increasing anecdotal evidence from physicians and patients suggests that there might actually be a shortage of medical dermatologists,” according to Archives of Dermatology (“Too Few or Too Many Dermatologists?” Oct. 2001, Vol. 137). The United States has more than 9,000 dermatologists, according to the article. A companion Archives article maintains that long waiting times for appointments suggests that the current supply of dermatologists isn’t adequate to meet the demand (“Waiting Times to See a Dermatologist Are Perceived as Too Long by Dermatologists,” October 2001, Vol. 137). More than 60% of surveyed dermatologists exceeded benchmark waiting times of 3 weeks for a new patient appointment and 2 weeks for a return appointment. The profession is entering a decade where it faces “person-power issues in dermatology,” says Neil Swanson, M.D., professor and chair of dermatology, Oregon Health & Science University (OHSU), Portland, OR, and AAD vice president. “Numerous pieces of evidence” point to a current shortage and suggest that things will get worse before they get better, according to Alexa Boer Kimball, M.D., M.P.H., assistant professor, dermatology, at Stanford University Medical Center and chairperson of the Workforce Task Force for AAD. Only 12 new dermatology residency positions will be available nationwide beginning July 2003, according to Dr. Cockerell. And of course those dermatologists won’t be available for practice for years. Multiple factors lead to this possible shortage. One proposed explanation is the increasing number of women in dermatology: from 278 female dermatologists in 1970 to 2,853 in 1998, according to Archives. Some suggest that because women may choose to work fewer hours so they can meet childcare needs, they may not provide the same number of patient care hours as male dermatologists. Dr. Kimball, however, feels that this argument is overrated. In a survey of graduating residents and fellows, researchers found that women work on average only 4 hours less per week than men. And men and women, says Dr. Kimball, are spending roughly the same amount of time seeing medical dermatology patients. She also points out that, at least in other medical professions, women tend to have longer careers than men. Another factor involves a lack of residency spots. Potential dermatology residents can’t find a vacancy, says Dr. Kimball. Different types of funding for these residency spots may help address this issue. A third factor involves teachers. Fewer individuals are going into academic medicine, suggests Dr. Cockerell. Thus, not enough teachers may be available to train the future workforce. Use of Physician Extenders Besides the obvious solution of training more dermatologists, another answer involves the use of physician extenders. Today, it’s fairly common for dermatologists in most places to have them, and this “will be almost the norm” in the next few years, suggests Dr. Cockerell. The number of PAs in dermatology has increased “exponentially,” says Dr. Kimball, and will likely continue. That trend has some people concerned and others excited, says Dr. Kimball. Obviously, these clinicians need to be used appropriately. Shift to Cosmetics Related to this shortage issue are concerns that dermatology is migrating from its traditional roots as a medical specialty to a medical/surgical/cosmetic specialty. Some have speculated, says Archives, that there is a growing shortage in medical dermatologists, created as surgical and cosmetic procedures have begun to occupy an increasing share of dermatology practices. “The way that things are evolving, we will unfortunately see a decline in the number of people trained in medical dermatology,” says Dr. Williford. Areas such as rheumatology and vasculitis require a significant level of expertise and skill, but are reimbursed relatively poorly versus things such as Botox, he maintains. “The revenue streams are so obviously superior in providing outpatient elective cosmetic procedures” to those who can afford it. More dermatologists, says Ms. Ellzey, are offering cash cosmetic services instead of dealing with oversight from managed care companies. This reduces hassles and at the same time increases cash flow. Dr. Swanson, though, suspects that the profession will see a “peak and plateau” in the curve of dermatologists moving from medical to cosmetic dermatology. In the early ’90s, the rise of capitation meant that patients lost direct access to dermatologists. That force, combined with unfavorable reimbursement rates, encouraged physicians to look for other ways to develop revenues, including cosmetic work. Now, he sees managed care hassles lessening with the decline of gatekeepers and improved access to dermatologists. And that means less reason to emphasize cosmetic procedures. Regulating the Office On the regulatory front, several states have enacted major guidelines or regulations to address office procedures, especially surgical procedures and anesthesia, according to the AADA. Policymakers, the Academy says, have considered such things as requiring office-based physicians to have hospital privileges for procedures performed in the office and office accreditation. More bills or regulations are expected. Reducing medical errors associated with office-based procedures should be part of the effort to improve healthcare quality, states a recent article in Health Affairs (“Preventing Errors in the Outpatient Setting: A Tale of Three States,” July/August 2002, Vol. 21, No. 4). To help ensure safety, the authors recommend various strategies: • maintaining physicians’ knowledge base • requiring accreditation of outpatient facilities • regulating cosmetic surgery procedures • enlisting the help of professional organizations. The debate between those who want and those who oppose such regulation is characterized by an awful lot of “fervor and vitriol and not a lot of data,” says Dr. Williford. He predicts some regulation of the office, though not as “draconian” as some might expect. Patient interests may not be well-served with over-regulation of the office setting, suggests Lawrence Eichenfield, M.D., chief of pediatric and adolescent dermatology, Children’s Hospital and Health Center, San Diego. If procedures had to be done in the hospital or ambulatory surgery center instead of the office, patients might see markedly increased costs for minor procedures. And a backlash may develop if patients’ ability to receive care is constrained, suggests Dr. Eichenfield, who also serves as professor of pediatrics and medicine at the University of California, San Diego School of Medicine. You can divide the debate into two camps, suggests Allan Wirtzer, M.D., Mid Valley Dermatology, Sherman Oaks, CA, and member of the AAD board of directors. In one camp are those who suspect that states will require regulation sooner or later, so dermatologists may as well comply with accreditation requirements at the earliest date. The other camp holds that the bureaucratic requirements make no sense. Dr. Wirtzer compares this issue to the Clinical Laboratory Improvement Amendments (CLIA) which, he feels, served only to make running an office more expensive –- and did little else – for the vast majority of dermatologists. CLINICAL ADVANCES Besides these social and practice trends, look for the next 5 to 10 years to hold clinical advances in areas such as genetics, biologic therapies and lasers. Genetics Genetics, suggests Dr. Eichenfield, will make a large difference in understanding disease and have a direct influence on how dermatologists treat patients. On the one hand, he sees a “continued march” in the association of congenital diseases with specific genetic defects. He also forecasts an evolution in the understanding of risk factors for the development of common skin disorders that are genetically influenced. In pediatric dermatology, for instance, researchers are understanding genodermatoses one by one in terms of the abnormal mutations that cause disease. This leads to understanding both the particular disease and the working of normal skin, he says. Such discoveries will, says Dr. Eichenfield, “greatly change our ability to make specific diagnoses, and we will rely more and more on genetic testing.” Further, as researchers use genetic technologies such as DNA microarrays to understand disease, there can be a “very rapid development of targeted therapy.” While positive on gene-based therapies, Ken Washenik, M.D., Ph.D., investigator, Dermatophar-macology Unit, New York University School of Medicine, finds his enthusiasm tempered in the limited number of gene candidates to target at present. Researchers, he suggests, aren’t finding simple, single-gene answers for many diseases. Hair loss, for instance, may involve a large number of genes interacting in some fashion. Biologic Therapies One category of medicines that holds promise is biologics. These represent a “big part of the therapeutic future for patients with significant inflammatory disease,” says Dr. Washenik, who is also medical director of the Bosley Medical Institute, Beverly Hills, CA. Biologics specifically suppress inflammatory pathways that have become disregulated, he says, instead of the immune system in general. Therapies such as infliximab (Remicade), for instance, block action of the pro-inflammatory cytokine TNF-alpha. The psoriasis drug alefacept (Amevive), which received approval from an FDA panel in May, works in a different fashion. Instead of blocking the action of TNF-alpha, it prevents the production of pro-inflammatory cytokines such as TNF-alpha in the first place. Such drugs, says Dr. Washenik, can help address the unmet clinical need for long-term safety and remission of disease once therapy ceases. Besides psoriasis, he would expect these agents to work on other chronic T-cell driven cutaneous diseases such as atopic dermatitis and lichen planus. Sounding a cautionary note, Dr. Williford notes that such drugs don’t come without risk and a large price tag. Lasers In laser treatments for aging skin, the movement from ablative to non-ablative lasers is likely to continue — the list of non-ablative lasers grows weekly, according to Dr. Swanson. Non-ablative lasers, of course, avoid the creation of an open wound and the attendant risk of infection, bleeding, and longer healing time that ablative lasers entail. These non-ablative lasers are “extraordinarily popular,” says David J. Goldberg, M.D., J.D., clinical professor of dermatology and director of laser research and Mohs Surgery at Mount Sinai School of Medicine in New York City. Unfortunately, non-ablative systems don’t lead to the same degree of improvement as the more aggressive ablative systems. They also require multiple treatments. In the future, according to Dr. Goldberg, look for technology that blends the greater degree of improvement associated with ablative lasers with the benefits of non-ablative systems. “There’s no question there will be much more aggressive dermal wounding devices that create much more improvement than we’re currently able to do. Yet they will be cosmetically elegant,” Dr. Goldberg says. In hair removal, the future of the laser hair removal market involves using lasers for non-pigmented hair, according to Dr. Goldberg. Researchers are now attempting to give non-pigmented hair a chromophore so the hair can absorb laser light. Another potential area of development: using lasers along with some sort of substance or agent. This might involve applying a cream to the skin and activating the cream with a laser — “a marriage between two different sources,” says Dr. Goldberg. “The future of lasers in my view is the fusion of lasers plus something else.” One problem with this approach, suggests Dr. Swanson, is using molecules small enough to reach the dermis. The drug or agent may have to be delivered systemically instead of topically. “Golden Age” A few years ago, says Dr. Cockerell, dermatologists worried that their practices might evaporate as more patients received treatment from family physicians. That obviously hasn’t happened, and the future looks quite different today. Presently, there’s much demand for dermatologists and a lot of work to do, he suggests. In fact, the next years could represent a “potential golden age of dermatology.” n