Medical practice revenues have declined for the first time in several years, according to data from a Medical Group Management Association (MGMA, Englewood, Colo.) survey, which reported a 1.9 percent decrease in total medical revenue in 2008.
The drop, says MGMA, may be tied to smaller patient volumes and increasing bad debt due to patients’ financial hardship. The group reported a 9.9 percent drop in the number of procedures and an 11.3 percent slump in the number of patients from 2006 to 2008. Bad debt in multispecialty group practices from fee-for-service charges increased 13 percent from 2006 to 2008, it says.
MGMA data also indicate that total operating cost increased 54 percent in multispecialty group practices in the past 10 years, while total medical revenue increased 46 percent. Overall cost increases were due to a variety of factors, including increases in drug supply costs, support staff costs and professional liability fees.
The survey found that multispecialty practices reduced their overhead expenses 1.4 percent in 2008, largely by cutting support staff costs by 1.5 percent — the first decline in several years.
For more information on the survey, visit MGMA’s Web site.