Review and Update of the 1995 Physical 
Medicine and Rehabilitation Workforce Study

Review of 1995 Workforce Study Findings

In the 1995 study, it was assumed that the number of residency positions and the rate at which they would be filled would remain constant over time at the 1994-1995 level—resulting in about 350 new entrants into the profession each year. As a consequence, the number of physiatrists would nearly double by 2015.

Three alternative demand scenarios were developed in the 1995 study (Figure 1). In one scenario (1A), the 1994 physiatrist-to-population ratio was projected to reflect population growth under the assumption that the ratio would remain constant. With demand and supply roughly in balance in 1994, the increase in demand for physiatric services represented by population growth alone would be insufficient to keep pace with the growth in the number of physiatrists.

The second scenario (2C) estimated demand under 1994 market conditions and under the then level of knowledge in the market about the value and cost-effectiveness of the services of physiatrists. This scenario also estimated that the percentage of the population enrolled in managed care plans (specifically health maintenance organizations—HMOs) would increase from approximately 20% in 1994 to 36% by 2000 and to 53% by 2015. Increased competition from competing providers was also included in this case. Under these circumstances there would be excess demand for services until approximately 2000, after which the relatively rapid growth in the numbers of physiatrists would result in an excess supply—assuming that no other factors develop to increase demand.

A third case (3C in the figure), termed a "best case" scenario, was an estimate of the potential demand for services under then current market conditions, but with the assumption that payers, gatekeepers and beneficiaries would become fully aware of the efficacy and efficiency of the services provided by PM&R physicians. This scenario also assumed a moderate growth in managed care and in the number of competing providers. In this case, it would be more than 15 years before the number of physiatrists exceeded the level of demand for their services.

The study panel noted that there was a potential for increasing the demand for physiatric services—even with continued growth in managed care—if the specialty would provide more information to market participants about the value and cost-effectiveness of the care provided by physiatrists. In response to that observation, the American Academy of PM&R developed a "PM&R Awareness Initiative" aimed at increasing the awareness, understanding and preference for PM&R with key audiences and at enabling physiatrists to practice more effectively in a managed care environment.

The study panel reviewed the results to date of this "awareness" campaign and concluded that the effort has been successful, as market demand moves toward the path predicted in the 1995 study’s "best case" scenario.

Overall, the conclusions from the 1995 study were:

• At the 1994-95 level of residency capacity, the supply of physiatrists would nearly double in 20 years. The specialty would be challenged to absorb this growth in supply as market conditions changed in the managed care environment.

• The market could absorb the projected growth in supply over the next five years, assuming moderate growth in the percent of the population enrolled in managed care, moderate growth in the number of physicians in competing specialties, and with little change in the then current market conditions and in the level of consumers’ knowledge about the value of physiatrists’ services.

• The number of persons enrolled by managed care organizations will continue to increase and therefore it is crucial that payers, beneficiaries and "gatekeepers" be better informed of the value and cost-effectiveness of physiatry. If physiatry successfully addresses this particular challenge, and if the number of residency positions remain at or below 1994 levels, "significant aggregate excess supply" would not be likely to emerge through the year 2015.

• The South appears to be the region with greatest growth potential for physiatrists, while the Northeast and states adjoining the Great Lakes are areas that are more likely to have excess numbers of physiatrists.

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