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Lately, I often hear a cry from the nurses that it's cheaper to educate a PA/NP/SRNA than it is to educate a physician resident. Much cheaper in fact! I've even read it in the articles they've paid for! I'm going to use simple logic to educate everyone on exactly how much money a resident physician saves a hospital, and I'd like the readers to correct me where I'm wrong.
On any given day in my hospital you'll find a resident physician in my program (Anesthesiology) in the following hospital units:
OR
Outpatient Surgery Center
OB Anesthesia
off-site Anesthesia (ERCP, GI, EP lab, cardiac cath, CT, MRI)
PACU
Pre-op assessment clinic
General medicine service
GI medical unit/Renal/Heme-Onc/other medicine service
Cardiology Consult Service
Pulmonology Consult Service
Nephrology Consult Service
Medical ICU
Neuro ICU
Cardiac ICU
Surgical ICU
Pediatric ICU
Neonatal ICU
Emergency Department
Pain Management Clinic
Acute Pain Consult Service
Chronic Pain Consult Service
There may be others that slip my mind right now, but for the sake of argument let's say that's it.
1st year of training
Let's say you replace me on a medical service with an NP. I work 80 hours a week, they work 40. I make 45k/year, they make 90k/year (using round numbers b/c they're just easier to work with). Let's make the assumption that we receive the same benefits also (a false assumption since their retirement plan options are MUCH better than mine, including an employer benefit which I am not eligible for).
Okay, so in one year of work I've make 45k. It takes two NPs to do the work of me, so that's 180k of salary cost to the hospital if I'm not there. I've saved the hospital 135k in year one. But, I've saved them even more! Because with two NPs making up for my work, you have a second NP getting benefits so my hospital is now paying the benefits of two vs the benefits of just me. I have no clue how much a benefit package would be for an NP, so I'll just say 35k. If I'm way off someone correct me. So I've saved the hospital another 35k.
Year One Savings: (180,000 - 45,000) +35,000 = $170,000 of savings
You could make the argument that I save even more because I work nights, weekends, take 24-30 hour call at a time, and work holidays. Those two NPs will likely not make up all the work I've done, but I'm being as simplistic as possible here.
2nd year of training
I'm in an anesthesiology program now. Let's say I'm in the OR for 10 months this year, the ICU for 1 month, and the pre-anesthesia clinic for 1 month. Again, I'm making some simple assumptions.
Again, I make 45k for my 80 hours of labor, but let's say I only average 70 hours/week. To replace me, my department would have to hire another CRNA. They cost roughly 150k base salary, plus 1.5x hourly for every hour after 40. Let's estimate that overtime pay is $100/hour, and they have to work 30 hours a week at $100/hour to make up the difference, or an extra $3000/week. So now, let's make an assumption based on good business. My department realizes how expensive it'd be to pay one CRNA that much (and also, they'd never work that much!) so my department hires two CRNAs. They pay me 45k, two CRNAs 300k, and an extra benefit package of 35k.
The months I'm in the pre-anesthesia clinic and ICU they'll have to hire a PA/NP to replace me.
I've saved the following:
my 10 months in OR: 45,000 * (10/12) = 37,500
Cost of 2 CRNAs in 10 months of OR: 300,000 * (10/12) = 250,000
Extra benefit package for 10 months: 35,000 * (10/12) = 29,167
In 10 months I've saved my department $241,667
While I'm in the ICU/Pre-op clinic for 2 months I save the following:
my 2 months in ICU/Pre-op clinic: 45,000 * (2/12) = 7,500
Cost of 2 NPs in ICU/Pre-op clinic: 90,000 * (2/12) = 15,000
Extra benefit package for 2 months: 35,000 * (2/12) = 5,833
In 2 months I've saved my department $13,333
Year Two Savings: $241,667 + $13,333 = $255,000
Third Year of Training
Same assumptions as above, but let's say I spend 3 months off-service this year (ICU, Pain clinic, acute pain consult, chronic pain consult, etc.). Cost savings as follows:
my 9 months in OR: 45,000 * (10/12) = 33,750
Cost of 2 CRNAs in 9 months of OR: 300,000 * (10/12) = 225,000
Extra benefit package for 9 months: 35,000 * (10/12) = 26250
In 9 months I've saved my department $217,500
While I'm off-service for 3 months I save the following:
my 3 months off-service: 45,000 * (3/12) = 11,250
Cost of 2 NPs for 3 months: 90,000 * (3/12) = 22,500
Extra benefit package for 3 months: 35,000 * (3/12) = 8,750
In 3 months I've saved my department $20,000
Year 3 Savings: $217,500 + $20,000 = $237,500
Fourth Year of Training
Let's say I spend 2 months off-service this year (ICU, pain, etc.). My savings are as follows:
my 10 months in OR: 45,000 * (10/12) = 37,500
Cost of 2 CRNAs in 10 months of OR: 300,000 * (10/12) = 250,000
Extra benefit package for 10 months: 35,000 * (10/12) = 29,167
In 10 months I've saved my department $241,667
While I'm off-service for 2 months I save the following:
my 2 months off-service: 45,000 * (2/12) = 7,500
Cost of 2 NPs for 2 months: 90,000 * (2/12) = 15,000
Extra benefit package for 2 months: 35,000 * (2/12) = 5,833
In 2 months I've saved my department $13,333
Year Four Savings: $241,667 + $13,333 = $255,000
Total savings over 4 years of Training = $917,500
Finally, multiply this number by the number of residents in your program. If your residency has 10 residents/year, your program saves $9,175,000 over 4 years by hiring residents instead of CRNAs and NPs/PAs. If your program has 20 residents/year, your program saves $18,350,000.
Also, consider the fact that during year 4 of training the resident physician is doing things that only an attending physician can do. By year 4 of training most resident physicians should be able to do just about any anesthesiology case on their own. They should be proficient in TEE, regional, pain, ICU. They're studying for their oral/written boards. In short, they're at the top of their game. If you were to replace them, it'd need to be with another attending physician. This creates even more savings. Not as much as people think as in academics the attendings don't make that much more than the CRNAs, and oftentimes less than the rural, independent CRNAs! But, you get my point.
So let's have this discussion. How exactly does it cost so much to train a resident physician? As I believe I've proven here, resident physicians save the hospital and their department extremely large amounts of money.
On any given day in my hospital you'll find a resident physician in my program (Anesthesiology) in the following hospital units:
OR
Outpatient Surgery Center
OB Anesthesia
off-site Anesthesia (ERCP, GI, EP lab, cardiac cath, CT, MRI)
PACU
Pre-op assessment clinic
General medicine service
GI medical unit/Renal/Heme-Onc/other medicine service
Cardiology Consult Service
Pulmonology Consult Service
Nephrology Consult Service
Medical ICU
Neuro ICU
Cardiac ICU
Surgical ICU
Pediatric ICU
Neonatal ICU
Emergency Department
Pain Management Clinic
Acute Pain Consult Service
Chronic Pain Consult Service
There may be others that slip my mind right now, but for the sake of argument let's say that's it.
1st year of training
Let's say you replace me on a medical service with an NP. I work 80 hours a week, they work 40. I make 45k/year, they make 90k/year (using round numbers b/c they're just easier to work with). Let's make the assumption that we receive the same benefits also (a false assumption since their retirement plan options are MUCH better than mine, including an employer benefit which I am not eligible for).
Okay, so in one year of work I've make 45k. It takes two NPs to do the work of me, so that's 180k of salary cost to the hospital if I'm not there. I've saved the hospital 135k in year one. But, I've saved them even more! Because with two NPs making up for my work, you have a second NP getting benefits so my hospital is now paying the benefits of two vs the benefits of just me. I have no clue how much a benefit package would be for an NP, so I'll just say 35k. If I'm way off someone correct me. So I've saved the hospital another 35k.
Year One Savings: (180,000 - 45,000) +35,000 = $170,000 of savings
You could make the argument that I save even more because I work nights, weekends, take 24-30 hour call at a time, and work holidays. Those two NPs will likely not make up all the work I've done, but I'm being as simplistic as possible here.
2nd year of training
I'm in an anesthesiology program now. Let's say I'm in the OR for 10 months this year, the ICU for 1 month, and the pre-anesthesia clinic for 1 month. Again, I'm making some simple assumptions.
Again, I make 45k for my 80 hours of labor, but let's say I only average 70 hours/week. To replace me, my department would have to hire another CRNA. They cost roughly 150k base salary, plus 1.5x hourly for every hour after 40. Let's estimate that overtime pay is $100/hour, and they have to work 30 hours a week at $100/hour to make up the difference, or an extra $3000/week. So now, let's make an assumption based on good business. My department realizes how expensive it'd be to pay one CRNA that much (and also, they'd never work that much!) so my department hires two CRNAs. They pay me 45k, two CRNAs 300k, and an extra benefit package of 35k.
The months I'm in the pre-anesthesia clinic and ICU they'll have to hire a PA/NP to replace me.
I've saved the following:
my 10 months in OR: 45,000 * (10/12) = 37,500
Cost of 2 CRNAs in 10 months of OR: 300,000 * (10/12) = 250,000
Extra benefit package for 10 months: 35,000 * (10/12) = 29,167
In 10 months I've saved my department $241,667
While I'm in the ICU/Pre-op clinic for 2 months I save the following:
my 2 months in ICU/Pre-op clinic: 45,000 * (2/12) = 7,500
Cost of 2 NPs in ICU/Pre-op clinic: 90,000 * (2/12) = 15,000
Extra benefit package for 2 months: 35,000 * (2/12) = 5,833
In 2 months I've saved my department $13,333
Year Two Savings: $241,667 + $13,333 = $255,000
Third Year of Training
Same assumptions as above, but let's say I spend 3 months off-service this year (ICU, Pain clinic, acute pain consult, chronic pain consult, etc.). Cost savings as follows:
my 9 months in OR: 45,000 * (10/12) = 33,750
Cost of 2 CRNAs in 9 months of OR: 300,000 * (10/12) = 225,000
Extra benefit package for 9 months: 35,000 * (10/12) = 26250
In 9 months I've saved my department $217,500
While I'm off-service for 3 months I save the following:
my 3 months off-service: 45,000 * (3/12) = 11,250
Cost of 2 NPs for 3 months: 90,000 * (3/12) = 22,500
Extra benefit package for 3 months: 35,000 * (3/12) = 8,750
In 3 months I've saved my department $20,000
Year 3 Savings: $217,500 + $20,000 = $237,500
Fourth Year of Training
Let's say I spend 2 months off-service this year (ICU, pain, etc.). My savings are as follows:
my 10 months in OR: 45,000 * (10/12) = 37,500
Cost of 2 CRNAs in 10 months of OR: 300,000 * (10/12) = 250,000
Extra benefit package for 10 months: 35,000 * (10/12) = 29,167
In 10 months I've saved my department $241,667
While I'm off-service for 2 months I save the following:
my 2 months off-service: 45,000 * (2/12) = 7,500
Cost of 2 NPs for 2 months: 90,000 * (2/12) = 15,000
Extra benefit package for 2 months: 35,000 * (2/12) = 5,833
In 2 months I've saved my department $13,333
Year Four Savings: $241,667 + $13,333 = $255,000
Total savings over 4 years of Training = $917,500
Finally, multiply this number by the number of residents in your program. If your residency has 10 residents/year, your program saves $9,175,000 over 4 years by hiring residents instead of CRNAs and NPs/PAs. If your program has 20 residents/year, your program saves $18,350,000.
Also, consider the fact that during year 4 of training the resident physician is doing things that only an attending physician can do. By year 4 of training most resident physicians should be able to do just about any anesthesiology case on their own. They should be proficient in TEE, regional, pain, ICU. They're studying for their oral/written boards. In short, they're at the top of their game. If you were to replace them, it'd need to be with another attending physician. This creates even more savings. Not as much as people think as in academics the attendings don't make that much more than the CRNAs, and oftentimes less than the rural, independent CRNAs! But, you get my point.
So let's have this discussion. How exactly does it cost so much to train a resident physician? As I believe I've proven here, resident physicians save the hospital and their department extremely large amounts of money.