Physician net revenue was down 4.5% in 2020, analysis finds

Although many physician practices saw increased productivity and revenue in the late summer and early fall, most performance measures, including physician net revenue, remained below 2019 levels amid a strained COVID-19 pandemic environment, according to a new analysis.  

The report, released Jan. 26 by consulting firm Kaufman Hall, is based on data from Syntellis Performance Solutions, previously Kaufman Hall Software, which contains information on nearly 100,000 physicians and advanced practice providers in more than 100 specialties.

It found that physician work relative value units per full-time equivalent, a measure of productivity, climbed 4.6 percent from July to October. However, this was still 4.9 percent below 2019 levels, attributable to fewer patient visits and lower hospital diagnostic and procedural volumes.

"New patient visits — key observations which are key to growing physician practices — also declined year over year [because of] negative economic trends, competitive telehealth offerings and continued reluctance of some patients to visit physician offices," the analysis said.

Kaufman Hall said volume increases from July to October contributed to a boost in revenue. The analysis found that net revenue per physician full-time equivalent increased 8.1 percent during that period. However, it decreased 4.5 percent compared to the same period in 2019 because of lower productivity.

At the same time, total direct expense per physician full-time equivalent only rose slightly, up less than 1 percent from July to October, according to the analysis.

The analysis concluded that "the future success of physician practices will rely on cash flow recovery and the pace of capital spending and investments." 

Kaufman Hall said managing care costs will also be crucial for practices amid significant shifts to telehealth, and "a sound performance improvement infrastructure and operating controls will be key to managing through 2021."

Read the full analysis here

 

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