Which health professions are the higher ed market's ‘blue chips?’

Physical therapy (PT) and occupational therapy (OT) are popular career fields, and their rosy job outlooks have saturated the news cycle. These professions yielded some of the highest-growth forecasts from the Bureau of Labor Statistics, US News and World Report, Kiplinger, and CareerBuilder. EAB’s labor market analysis supports these projections, showing strong job market growth since the passage of the Affordable Care Act (ACA).

Despite being high revenue programs promoted by the ACA and the Medicare and CHIP Reauthorization Act, universities are not producing enough physical therapists and occupational therapists to fill a dramatic shortage. Normally these conditions would be ideal for COE disruption, but accreditation barriers stand in the way.

When high demand meets low supply

Since the passage of the ACA in 2010, access to health care expanded to populations with continual care needs and emphasized preventative care and management of chronic conditions. Physical therapists and occupational therapists, who specialize in strengthening and rehabilitating patients, have therefore taken on an increased case load. Demographic shifts are also contributing to increased demand, as growing elderly populations and individuals with autism drive referrals to therapists.

Despite increased demand, standards for PT and OT education restrict supply. Physical therapists and occupational therapists must graduate from an accredited program to practice. Earning accreditation requires clinical placements for all students, qualified faculty, and a substantial financial investment in facilities and faculty salaries. Due to limited capacity, accrediting organizations only consider 18 institutions’ applications per year, including physical therapy assistant and occupational therapy assistant programs.

Programs are profitable—but accreditation barriers remain a risk

Doctor of Physical Therapy, Master of Occupational Therapy, and the expected development of Doctor of Occupational Therapy programs have the potential to drive increased enrollment. Programs receive more applications than they can admit—by a wide margin. In 2014, PT programs received 10.3 applications per available seat. OT programs received 5.7 applications per seat.

The accreditation barriers above, pose a substantial threat to starting new programs. However, these programs often charge a higher tuition than other programs, making them ideal revenue generators and safe bets for long term growth. Successful PT and OT program launches require the ability to invest $1-$4 million dollars to acquire faculty and facilities, have little or no local competition for clinical placements, and build relationships with health care partners.

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