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New MGMA Data Shows Medical Practices Utilizing More Non-Physician Providers are More Profitable, Productive

Press Release

Benchmarking Data

Survey further demonstrates the growing use of non-physician providers as primary care providers in face of growing physician shortage
 
Englewood, Colo. – Today, Medical Group Management Association (MGMA) released its 2018 MGMA DataDive Cost and Revenue data, which found that medical practices that utilize more non-physician providers benefit from increased revenue and productivity.
 
“In the face of a growing physician shortage in the United States, and as MGMA discovered through several other DataDive datasets, American medical practices continue to rely more and more on non-physician providers to treat their patients,” said Dr. Halee Fischer-Wright, President and CEO of MGMA. “Today’s findings not only further demonstrate this trend, but show that by utilizing more non-physician providers in their practice, administrators can actually boost their practices’ revenue and productivity by allowing physicians to focus on the most acute cases.”
 
While primary care practices with a higher non-physician provider (NPP) to physician ratio (0.41 NPPs per physician or more) report greater expenses, they also report earning more in revenue after operating costs than practices with fewer NPPs (0.20 or fewer NPPs per physician), regardless of specialty. Physician-owned practices with 0.41 or more NPPs report earning $100,748 more in revenue after operating expenses per physician than practices with 0.20 or fewer NPPs. In hospital-owned primary care practices, that difference is $131,770 more in revenue after operating costs per physician. 
 
“Because these non-physician providers can effectively compliment primary care services for the organization, access to care increases. Ultimately, both the number of patient encounters as well as their satisfaction can increase,” said Ken Hertz, Principal Consultant at MGMA. “This is a win-win for both patients and practices – patients’ health outcomes improve while practice revenue increases.”
 
Additionally, the data shows that most practices generally reported an increase in expenses since 2013. These findings are in line with a July 2018 MGMA Stat poll in which 69 percent of respondents indicated their practice has seen overhead expenses increase in the past year. 

The data finds that over the past 5 years, median operating costs for primary care practices have risen by 13 percent, from $391,798 per physician to $441,559 per physician.  With overall expenses on the rise, practices continue to have evergreen expenses, where general operating costs make up 32 cents of every dollar collected in physician-owned practices. Of that IT represents 2 cents, drug supply 6 cents, and building occupancy another 6 cents. 

Based on comparative data from more than 3,000 organizations, the 2018 MGMA DataDive Cost and Revenue data is the most comprehensive sample of any medical practice finance survey in the United States. The survey represents a variety of practice types including physician-owned and hospital-owned, as well as organizations from across the nation at small and large practices.
 
The MGMA DataDive Cost and Revenue data is the most trusted compensation survey in the U.S., undergoing a rigorous evaluation and inspection. 
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