Medical-Care Job Market Has a Few Aches and Pains Providers Here Start to Feel Cost Squeeze

By Jim Gallagher Of the Post-Dispatch | St Louis Post-Dispatch (MO), December 2, 1993 | Go to article overview

Medical-Care Job Market Has a Few Aches and Pains Providers Here Start to Feel Cost Squeeze


Jim Gallagher Of the Post-Dispatch, St Louis Post-Dispatch (MO)


The man comes to the emergency room at St. John's Mercy Medical Center complaining of chest pain.

The doctor's diagnosis is guarded. "I'm pretty sure it's not the heart - but. . ." he says.

Until September, such a patient went straight to the high-care, high-cost cardiac unit. These days he'll still get close monitoring, but in the new "chest pain evaluation center" at a cost of thousands of dollars less.

President Bill Clinton's health-care reform plan, which would cap the nation's medical bill, faces iffy prospects in Congress. But the cost squeeze is already here for the medical industry in St. Louis, the area's No. 1 employer.

Even without major reforms, hospitals and doctors are expecting increased pressure from "managed care" insurance programs, which contract for medical service at a set price.

And with a health-care overhaul on Washington's front burner, providers are looking hard at ways to save a buck.

The result may mean major surgery for the biggest, fastest-growing industry in St. Louis.

Job Engine Loses Steam

The explosive growth in health-care employment already shows signs of slowing down.

Health care has been the prime economic engine in St. Louis since the mid-1980s. The number of health-care jobs is up 30 percent in the last 10 years. That's double the job growth for St. Louis as a whole.

Even in the recession years of 1990 and 1991, health-care employment here grew 9 percent, while total employment shrank 1 percent.

Since then, however, health-care employment has risen only 4 percent, while total employment remains frozen.

"It definitely has slowed. But health care still creates more jobs than any other industry," said Russ Signorino, labor analyst of the Missouri Division of Employment Security.

No one is predicting that the health-care sector will shrink in St. Louis. The aging of the population and the possibility of universal health insurance could keep demand for services strong.

"Take the guy who would have died at 62 of heart disease. We keep him alive, then at age 70 we fix his eyes," said Richard Grisham, chief executive at St. Anthony's Medical Center in south St. Louis County.

But health-care reform and the emphasis on cost control could stall the region's fastest job generator, or at least knock it back into low gear.

St. Louis has a monster of a medical business. One out of 10 employed people here works in a hospital, nursing home, rehab center or doctors' office.

And those figures don't count the hordes of workers in health insurance, medical equipment and drug factories, accountants, lawyers and other related industries.

Pay Is Above Average

Medical jobs also pay more than most. Wages in health care rose six times as fast as in other industries in the decade ending in 1991, according to the Bureau of Labor Statistics.

An intensive-care nurse on the night shift at St. Anthony's earns $50,000 a year, plus overtime. The median wage in St. Louis for an occupational therapist is $16.50 per hour and $20 an hour for a pharmacist, according to state figures.

The average physician in the United States earns $170,000 per year, according to the American Medical Association.

Of course, money saved on health care is invested elsewhere in the economy. What a company doesn't spend on higher health insurance it may use to hire an extra worker.

But slower growth for the region's biggest industry could cause some uncomfortable ripples in the St. Louis job market. The growth in health care has been making up for much of the decline in defense and other manufacturing jobs.

Clinton's managed-competition plan - built around giant cooperatives that buy insurance for their members - would put heavy cost pressure on insurers and medical businesses. But cost pressures are building, anyway. …

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