Making the Business Case to Address Physician Burnout

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As widespread exposure and news coverage continues on physician burnout, three researchers wanted to understand the economics of the problem and offer a possible solution.

Called the Business Case for Investing in Physician Well-Being, the study by physicians and authors Shanafelt, Gohl, and Sinsky first lays out the problem. According to a 2011 study the researchers cited, burnout was nearly twice as common among physicians compared with U.S. workers in other fields, even after adjusting for age, sex, relationship status, level of education and hours worked per week.1 In a follow up study, the rate of burnout had increased by 9% among physicians while remaining stable among U.S. workers in other fields over the same interval.2

They also cite the cost of turnover related to burnout. According to the researchers, multiple large, national studies of U.S. physicians have indicated that burnout is one of the largest factors determining whether or not physicians intend to leave their current position over the next 24 months, and a Stanford study found that the actual 2-year rate of turnover among physician faculty who were burned out was double that of non-burned out faculty. 3

And the turnover costs to hospitals is significant.

A recent report by Atrius Health reported that their organizational cost to replace a physician was $5000,000 to $1 million.4

Another “cost” is decreased productivity. One longitudinal study of 2,500 physicians at Mayo Clinic suggested that for each 1-point increase in burnout (on a 7-point scale) or a 1-point decrease in professional satisfaction (on a 5-point scale) – there was a 30% to 50% increase in the likelihood that physicians would reduce their professional work effort over the following 24 months. 5 Due to high fixed costs, the researchers point out, even a small change (1-2%) in productivity can have large effects on an organization’s bottom line.

Addressing the Problem
How should the problem be addressed?

The researchers suggest that burnout is primarily a system-level problem driven by excess job demands and inadequate resources and support, not an individual problem triggered by personal limitations. They also suggest that to understand the problem, hospitals should look at 7 factors or dimensions: (1) workload, (2) efficiency, (3) flexibility and/or control, (4) culture and values, (5) work-life integration, (6) community at work, and (7) meaning in work – each of which is influenced by national, organization, work unit and individual factors.

Making The Business Case 
Based on this knowledge, how much should an organization invest each year to reduce burnout and promote physician engagement?

The authors work backwards with a hypothetical scenario, starting with turnover.

If an organization employed 450 physicians and it had an annual turnover rate of 7.5% with replacement costs of $500,000 per physician – the annual organizational cost of physician turnover would be approximately $16.9 million per year.

If the organization spent $1 million that could reduce the prevalence of burnout from 50% to 40%, the associated organizational cost savings would $1.125 million per year or an ROI of 12.5%.

The authors point out that their ROI is conservative since it does not account for lost revenue due to decreased productivity among burned out physicians, nor does it take into account the costs associated with lower patient satisfaction, quality and safety or the increase in litigation risk from burnout. They also point out the “ripple effect” and infectious nature of burnout among other care team members.

They conclude by saying that many organizations have “failed to take action commensurate with the risk to the organization.” By understanding the business case to reducing burnout and promoting engagement, the researchers suggest that improvement is possible, the investment justified, and the return on investment measurable. They say addressing this issue is not only the organization’s ethical responsibility, but a fiscal responsibility as well.6

1 Shanafelt TD, Boone S, Tan L, et al. Burnout and satisfaction with work-life balance among US physicians relative to the general US population. Arch Intern Med. 2012;172(18):1377-1385
2 Shanafelt TD, Hasan O, Dyrbye LN, et al. Changes in burnout and satisfaction with work-life balance in physicians and the general US working population between 2011 and 2014. Mayo Clin Proc. 2015;90(12):1600-1613
3 M. Trockel, MD, PhD, written communication, May 2017
4 Noseworthy J, Madara J, Cosbrove D, et al. Physican burnout is a public health crisis: a message to our fellow health care CEOs. Health Affairs Blog; March 28, 2017
5 Shanafelt TD, Mungo M, Schmitgen J, et al. Longitudinal study evaluating the association between physician burnout and changes in the professional work effort. Mayo Clin Proc. 2016;91(4):422-431
6 Shanafelt T, Goh J, Sinsky C. The Business Case for Investing in Physician Well-being. JAMA Intern Med. 2017 Dec1;177(12):1826-1832.