EHR, Operating Cost Hikes Challenge Practice Managers

John Commins, for HealthLeaders Media , June 29, 2010

Rising operating costs, managing finances amid Medicare reimbursement shifts, and installing electronic health records are the top three challenges for medical practice managers, according to Medical Practice Today: What Members Have to Say, an annual survey from the Medical Group Management Association.

"It is not surprising that 'maintaining finances with the uncertainty of Medicare reimbursement rates' jumped to the No. 2 spot this year due to the continued congressional irresponsibility in not permanently addressing the flawed sustainable growth rate formula," said William F. Jessee, MD, president/CEO of Englewood, CO-based MGMA.

Medicare reimbursement rate uncertainty ranked No. 5 in 2008 and 2009.

The online survey of 1,798 people -- conducted from Feb. 12 to March 5 -- also found that "managing teamwork and group dynamics among physicians," an organizational governance issue MGMA introduced to the list this year, debuted at No. 8. "Implementing a patient-centered medical home model of care" made the biggest leap from last year's list -- from No. 22 to No. 12.

"Practices are clearly balancing the very serious issue of keeping their practices afloat amid unprecedented financial uncertainty with the more delicate practice management issues such as managing group dynamics and overseeing their organizations' strategic direction," Jessee said.

MGMA found that when compared with independent medical practices, hospitals and health system respondents were more concerned with:


  • Modifying physician compensation methodology
  • Recruiting physicians
  • Dealing with rising operating costs
  • Implementing a patient-centered medical home model of care


However, hospitals and health system respondents were less likely than independent medical practices to be challenged by "maintaining physician compensation levels" and "negotiating contracts with payers."

For a second year, MGMA also asked participants how the recession is affecting their medical groups and how they are responding. The participants said their practices have:


  • Improved billing collections and/or denial management processes
  • Decreased revenue
  • Seen an increase in uninsured patients
  • Postponed capital expenditures
  • Cut operating budget


While these same issues ranked as the top five issues in 2009, the percentage of respondents who saw an increase in uninsured patients or postponed capital expenditures dropped this year. Among the ranking of the recession's effects, "staff salary freeze" accounted for the biggest jump in rank, moving up from No. 12 to No. 6.

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