Operating costs rose faster than revenue in many medical group practices in 2006, according to the Medical Group Management Association (MGMA) Cost Survey: 2007 Reports Based on 2006 Data--two in-depth reports for multispecialty and single-specialty practices. The data underscore the need for change in how physicians are reimbursed for their services.
OB/GYN groups, for example, experienced a 2.3 percent bump in median total medical revenue per FTE physician, but their median total operating cost per FTE physician rose 7.1 percent. Multispecialty practices fared about the same--a 7.4 percent cost increase outpaced a 1.8 percent rise in revenue.
Several specialty practices watched their revenues decline or flatten. Cardiology practices, for example, posted a 0.7 percent decrease in median total medical revenue and a 3 percent increase in total operating cost. Family practice fared about the same with a 0.65 percent decline in revenue and a 2.1 percent bump in cost. General surgery groups reported a decline in revenue of nearly 2.9 percent and a 1.2 percent increase in cost.
“This year’s data show that the disturbing trend of operating costs rising faster than revenues continues unabated,” said William F. Jessee, MD, president and CEO of MGMA. “The disparity between practices’ costs and revenues is fast approaching the breaking point.” Read the press release.
