- Staffing shortages and record-high inflation are hitting medical groups, health systems and hospitals hard in 2022.
- MGMA released a new survey report which stated that 90% of medical practices reported costs have risen faster than revenues in 2022.
- Other data from this report added that only 60% of medical practices hit their revenue goals in 2021.
According to a recent Medical Group Management Association (MGMA) report, new challenges – particularly, staffing shortages and record-high inflation – are hitting medical groups, health systems and hospitals hard in 2022.
Rising expenses and the ongoing pressures to restore productivity and revenue in healthcare organizations has led to several health systems reporting significant losses and others with many operating margins under 1%.
The 2022 MGMA Cost and Revenue survey report collected data on more than 4,000 organizations from a variety of specialties and practice types, serving as a baseline for benchmarking 2022 operations.
Regarding staffing, MGMA also released a June 2022 Management and Staff Compensation data report which indicated that medical practice leaders face intense pressures from the impacts of the tight labor market and growing inflation.
MGMA´s President and Chief Executive Officer (CEO), Halee Fischer-Wright, stated that “costs have risen to a point where the margins of medical groups are imperiled in ways we haven´t seen since the early lockdown months of 2020”.
The risen salaries and wages of healthcare workers, healthcare workers that retired early or leave the industry for work in non-healthcare settings made staffing the top challenge for practices heading into 2022.
Here are some other key findings included in this MGMA report:
- 90% of medical practices reported costs have risen faster than revenues in 2022.
- Less than two-thirds (60%) of medical practices hit their revenue goals in 2021.
- Labor cost per patient increased 19%.
- Average hospital drug expenses were up 28% overall and 37% per patient.
- 62% of medical practices report their doctors´ malpractice premiums have increased since 2020.
- 36% of medical groups report drug supply had the largest increase among non-labor expenses in the past year.
The MGMA indicated that there has been an almost universal financial pinch on medical practices as inflation rises. The rising costs associated with inflation have added financial pressures for all medical group practices despite the ongoing recovery from the COVID-19 pandemic. Read more in the report: Cost-and-Revenue-DataReport-July2022-FINAL
Stay tuned for this and more industry news through our September 2022 newsletter. Subscribe to our monthly newsletter and our Health Prime Blog for ongoing leading industry medical practice articles and policy updates.
