Perfect substitutes: The impact of nurse practitioners on costs of similar services

Nurse practitioners have been increasing as primary care providers, from 65,000 in 2000 to 125,000 in 2009. Nurse practitioners have been able to provide similar services to other primary care physicians with similar health outcomes. While the services provided are similar, insurance companies reimburse nurse practitioners at lower rates than physicians. Because the nurse practitioners may serve as substitutes to physicians, more nurse practitioners might lead to lower reimbursement rates to physicians.;In this study, the growth in the concentration of nurse practitioners from 2001 to 2006 was used to determine whether there was an impact on physicians. The study looked at how the top 20% of counties in terms of high growth in the concentration of nurse practitioners per 100,000 affected (1) patient choice of physician or other primary care provider, and (2) reimbursement rates to physicians in high concentration areas. Patients had 16.5% lower odds of using a family practitioner or pediatrician rather than a nurse practitioner or physician assistant. Further, family practitioners and pediatricians received 3.1% less in reimbursement payments in high concentration growth areas than those physicians in lower concentration growth areas. From these results, high concentration growth areas for nurse practitioners have an impact on patient choice and on reimbursement rates, indicating that as the number of nurse practitioners increase, the cost of primary care providers will decrease.