Financial Management Challenges Practice Executives

Financial management issues are the biggest challenges facing medical practice executives as they struggle to adapt to rapid changes, legislative pressures and fiscal uncertainty.

Medical practice executives are struggling to adapt to rapid changes, legislative pressures and fiscal uncertainty, according to respondents to a Medical Group Management Association (MGMA) survey.

Respondents to the “Medical Practice Today: What members have to say” research revealed that the biggest challenge they face on a daily basis is dealing with rising operational costs.

“Physician practices are doing more and more to innovate and respond to our rapidly changing environment to meet the needs of their patients, but with fewer resources," Susan L. Turney, MD, MS, FACMPE, FACP, MGMA-ACMPE president and chief executive officer, said in a statement. "They are working diligently to manage rising operating costs and prepare for potential cuts to reimbursement rates, and are also navigating a number of other transformative federal policies that will soon go into effect, such as health insurance exchanges. It’s understandable that financial management issues rank among the most pressing concerns for our members.”

The top five issues were all financial management issues:

1. Dealing with rising operating costs

2. Preparing for reimbursement models that place a greater share of financial risk on the practice

3. Managing finances with the uncertainty of Medicare reimbursement rates

4. Collecting from self¬-pay, high-deductible, and/or health savings account patients

5. Understanding the total cost of an episode of care

However, medical practice executives also indicated that using systems to manage and evaluate population health was also a challenge. Implementing a new EHR was less challenging this year, but “optimizing” the existing system was more challenging.

“In the past couple years, practices have struggled to optimize their EHR system,” Derek Kosiorek, principal consultant, MGMA Health Care Consulting Group, said in a statement. “It’s important to work with your system vendor to really understand the functionalities of the system and learn how to best integrate these new capabilities with your processes. Some practices may even be using their second EHR system and are working to better optimize it than they did their first system.”

This year, respondents said collaborating with payers to implement new payment models is more intense and applicable to their jobs. Instability as a result of the sustainable growth rate formula has hindered the ability to participate in collaboration, but 82% indicated that they were willing to explore new Medicare payment models.

"Physicians need real-time data from payers in order to effectively manage patient populations. Integrated care delivery is the future and it can be facilitated in formal and informal ways,” Anders Gilberg, senior vice president of government affairs, MGMA-ACMPE, said in a statement. “As payers increasingly hold physicians accountable for cost and quality metrics, they must implement transparent collaborative approaches to contracting and data-sharing to assist practices in effectively serving their patients.”