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CONTACT:

Sharon Grace
Vice President, Public Relations
703.838.0033 ext. 393
sgrace@amga.org

January 8, 2017

AMGA 2017 Medical Group Operations and Finance Survey Indicates that Healthcare Organizations Face Increased Cost Pressures amid Revenue Growth Challenges

Alexandria, VA – AMGA today announced findings from the 2017 Medical Group Operations and Finance Survey, conducted by their consulting division, AMGA Consulting. Overall results showed a continuing increase in cost pressures and inability to grow revenues, leading to diminished operating results.

The operating loss per physician increased from a loss of 10% of net revenue found in the 2016 survey to a loss of 17.5% of net revenue in the 2017 survey. Total losses per physician during this two-year period went from $95,138 to $140,856 per physician at the median. During this period, while gross professional revenue increased from $1,217,350 to $1,328,625 at median, net professional revenue actually decreased at median from $682,735 to $681,322.

The survey results, delineated in a variety of ways in the report, also highlighted performance by group size and type. Interestingly, while private physician practices saw an increase in operating margin of $16,378 per physician (from a loss of $13,982 reported in 2016 to a profit of $2,396), integrated health systems saw an increase in the reported median operating loss per physician of $31,957 between 2016 and 2017 survey results (the 2017 operating loss increased approximately 15%, up to $243,918, compared to the 2016 reported median loss of $211,961).

The majority of integrated groups are small to mid-size (13 of the 15 reported) and, as expected, these group sizes also reported increasing operating losses per physician. Large groups, with more than 300 physicians, saw a decrease of operating loss, from 2016’s loss of $172,746 per physician to a loss of $35,477 per physician in 2017.

“The results of this survey suggest that groups must be diligent in managing their operational imperatives of their organizations,” said Fred Horton, M.H.A., president, AMGA Consulting. “Without real focus on operational costs and processes, there is a significant inability to grow revenues in a manner that will outpace practice inflation.”

“We believe that this survey and our educational offerings around best practices are valuable tools to help groups survive amid the increasingly challenging financial landscape,” said Jerry Penso, M.D., M.B.A., president and chief executive officer, AMGA. “We will continue to monitor these trends in order to ensure we are doing all we can to help our members succeed in the ever-shifting marketplace.”

About the Survey
The AMGA 2017 Medical Group Operations and Finance Survey includes financial summaries based on size, region, percentage of capitated net revenue; median data on direct expenses, provider compensation, and staffing; and accounts receivable information. It presents data from 49 organizations, representing more than 13,000 physicians.

About AMGA Consulting 
AMGA Consulting assists healthcare organizations navigate the changing industry environment. AMGA Consulting builds clients’ organizational capabilities through effective governance, operational improvement, strategic alignment, talent management, and total rewards solutions. amgaconsulting.com

About AMGA
AMGA is a trade association leading the transformation of health care in America. Representing multispecialty medical groups and integrated systems of care, we advocate, educate, innovate, and empower our members to deliver the next level of high performance health. AMGA is the national voice promoting awareness of medical groups’ recognized excellence in the delivery of coordinated, high-quality, cost-effective care. More than 175,000 physicians practice in our member organizations, delivering care to one in three Americans. For more information, visit amga.org