Healthcare Business News

Docs in hospital-owned practices see higher cost increases

By Melanie Evans
Posted: December 12, 2012 - 1:00 pm ET

Operating costs for a physician working full time increased in 2011 from the prior year, though costs grew more slowly for physician-owned groups than for hospital-owned practices, according to a medical management group's survey.

Operating costs per full-time doctor working in a physician-owned multispecialty practice climbed roughly 1.3% last year to total $528,182, the survey by the MGMA-ACMPE, formerly the Medical Group Management Association, found. That's compared with a 6.5% increase, to $387,586, in operating costs for a doctor working in a practice owned by a hospital or an integrated delivery system.

Medical revenue for physicians working in doctor-owned practices increased 3% from 2010 to $892,634. For physicians working in a hospital or integrated delivery system, revenue per doctor climbed 8% to $538,803.

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The voluntary survey, conducted between February and April, included data from 2,119 groups and is not nationally representative.

Labor costs accounted for the largest expense in medical groups, whether they were owned by doctors, hospitals or integrated delivery systems. Medical and surgical supply costs totaled 6% of physician-owned group expenses and 2.4% of costs for hospital- and IDS-owned groups.

Commercial fee-for-service accounted for 51% of total charges and commercial capitation made up another 1.8% of charges, the data show. Medicare accounted for 30.5% and Medicaid 10.4% of charges.

Patients who paid their own bills, or self-pay, totaled 3.8% of charges, and charity care and professional courtesy accounted for 0.76% of charges.

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