New data is showing an increase in provider compensation for the fourth year in a row.
A new report by the Medical Group Management Association (MGMA) found that the median compensation for primary care physicians, nonsurgical specialists, and surgical specialists increased by 4.44%, 1.81%, and 4.42%, respectively.
Advanced practice providers (APPs) saw a 6.47% increase.
Although providers were able to balance operating costs against inflation, the report noted that these increases are 21% below the Consumer Price Index, which saw a 3.4% increase in 2023.
There were also increases in provider productivity across all specialties and care settings, with an increase in median work relative value units (wRVUs) for APPs, primary care, and surgical specialty physicians at hospital-owned practices.
Independent practices saw higher increases in productivity than hospital owned practices for collections, total encounters, and wRVUs.
Providers throughout the sector are working against inflation and low reimbursement rates to maintain financial stability.
A recent operating margin index report by Kaufman Hall found that despite favorable financial performance in the first quarter of 2024, there was 0.2% drop between February and March. In April, CMS announced its proposed rule for a 2.6% rate increase to Medicare Advantage payments, with providers calling it “inadequate.”
Some providers have found success in supplementing their staff’s efforts with automated solutions to assist with cost containment.
At Grady Health, the system’s billing subsidiary, One Grady, leans heavily into automation to take some of the administrative burden off of staff and increase efficiency throughout its revenue cycle.
“Beyond that, we’re having to be very intentional and strategic about the way in which we handle denials,” Monica Richey, vice president of physician revenue cycle for One Grady, previously told HealthLeaders. “And really dig into how we operationalize our workforce to be able to manage those denials.”
Similarly, OSF Healthcare leans on the automated functions within its EHR platform to streamline processes and enable staff to complete more complex tasks. Prior authorizations were a consistent issue within the system’s revenue cycle, but they’ve seen some improvement having payers utilize their EHR’s payer payment platform to automate the process on their end.
“I’m always promoting that [option] with the payers because it promotes automation and the more we automate with the payers, the less they bother us,” Cathy Beebe, director of ministry managed care, previously told HealthLeaders.
Jasmyne Ray is the revenue cycle editor at HealthLeaders.
KEY TAKEAWAYS
Median compensation for primary care physicians, nonsurgical specialists, and surgical specialists increased have increased.
These increases are still 21% below the Consumer Price Index.
Independent practices saw higher increases in productivity versus hospital owned practices.