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Non-physician providers boost revenue, practice productivity, MGMA data shows

Practices with higher ratios of NPPs to physicians made more money, despite a rise in operating costs, data shows.

Beth Jones Sanborn, Managing Editor

Evidence continues to mount that non-physician providers can positively contribute to a medical practice's vitality, both in terms of care and the bottom line. New data from the Medical Group Management Association found that medical practices that use more non-physician providers see a boost in both revenue and productivity.

Based on comparative data from more than 3,000 organizations, the 2018 MGMA DataDive cost and revenue data represents various practice types including physician and hospital-owned, as well as small and large practices.

Primary care practices with 0.41 NPPs per physician or more did report greater expenses, but they also reported earning more revenue after operating costs than practices with fewer NPPs (0.20 or fewer NPPs per physician), no matter the specialty. Practices with 0.41 or more NPPs reported $100,748 more in revenue after operating expenses per physician and in hospital-owned primary care practices, the difference was $131,770 more in revenue per physician after operating costs.

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"Because these non-physician providers can effectively complement primary care services for the organization, access to care increases. Ultimately, both the number of patient encounters as well as their satisfaction can increase," said Ken Hertz, principal consultant at MGMA.

The DataDive results showed that over the past five years, median operating costs for primary care practices had gone from $391,798 per physician to $441,559 per physician, a rise of 13 percent.  Evergreen expenses are a steady presence, such as general operating costs, which make up 32 cents of every dollar collected in physician-owned practices. IT represents 2 cents, drug supply 6 cents, and building occupancy 6 cents.

The cost increase findings here fall in line with the results of a recent MGMA Stat poll where 69 percent of respondents indicated their practices had seen hikes in overhead in the past year. 

Not only can non-physician providers boost productivity, some experts are pointing to them as a means to bridging looming gaps in staff thanks to forecasted physician shortages, especially in primary care. For instance, a June Health Affairs study showed nurse practitioners are on the rise in both rural and nonrural settings making for more diverse practice care teams. 

Approximately 234,000 NPs are licensed in the U.S and can deliver most of the services a physician can. Research has shown the care they deliver is safe and "high quality," Health Affairs said. 

The study looked at SK&A provider files from 2008-2016 to see the extent to which NPs are working in primary care physician practices during that time period in both rural and nonrural settings. In rural practices, the number of NPs is shown to be growing, rising from 17.6 percent to 25.2 percent from 2008 to 2016, an increase of 43.2 percent. An upward trend was also seen in later years in nonrural settings, from 15.9 percent in 2008 to 23 percent in 2016, an increase of 44.7 percent. 

For practice leaders and talent recruiters, the double whammy of physician shortages and rising expenses coupled with data showing the valuable and various ways non-physician providers contribute to the success of a practice should be a motivator to bring more of these clinicians onboard.

Twitter: @BethJSanborn
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