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Operating costs up; total revenue down
During the past 16 years, the average practice operating cost has risen 87% from $189,462 (1988) to $353,503 (2005), an average of 5.4% per year, according to the Medical Group Management Association’s (MGMA) Cost survey for multispecialty practices: 2005 report based on 2004 data.
The median total operating cost for a multispecialty practice has increased approximately 18% since 2000. However, from 2004-2005, the uptick was a mere 1.3%, the MGMA survey indicates. Although costs appear to be slowing, total revenue declined 0.7% from $586,381 (2004) to $582,307 (2005).