Survey: Health systems, physicians reported substantial operating losses in 2015

Integrated health systems and hospital medical practices, as well as private physician practices, reported operating losses in 2015, according to a revenue cycle management survey conducted by the American Medical Group Association.

Integrated health systems and hospital medical practices saw an operating loss of approximately $210,000 per physician, while private physician practices reported a near $14,000 operating loss per physician.

The survey also revealed that integrated health systems reported a median of $825,741 in total operating expenses. This is significantly lower than private physician practices, which reported a median of approximately $1.1 million.

The survey includes financial summaries based on size, region, percentage of capitated net revenue; median data on direct expenses, provider compensation, and staffing; and accounts receivable information. It presents 2015 data from 50 medical groups across the country, representing more than 10,000 physicians.

"Medical groups continue to rise to the challenge to provide quality, cost-effective care in an ever-shifting healthcare environment," Donald W. Fisher, PhD, AMGA president and CEO, said in a statement. "In a time of significant change marked by provider consolidation, it's imperative that C-level leaders have access to data that provides a complete picture of the market. This survey will be a valuable tool in benchmarking performance."

The survey overall showed that medical groups had a median operating loss of $95,138 in 2015, with average operating expenses representing 106.7 percent of net revenue.

Additionally, medical groups reported a median of $949,267 in total net revenue. The top expense for medical groups in 2015 was physician salaries with 41.6 percent of net revenue, according to the survey.

The survey also includes an overall staffing profile with department full-time equivalent employee per physician FTE.

"While it is somewhat expected that patient accounting and operations top the staffing chart, it's interesting to note that the median response adjusted to 100 physician FTEs requires 17 IT FTEs," Tom Dobosenski, president of AMGA Consulting, said in a statement. "Factors contributing to the prominence of IT FTEs may be the growing need for the ability to manage quality and service metrics and preparation for risk as the market shifts from volume to value."

Click here to download a complete copy of the report.


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