The Practice Profitability Index (PPI) — a survey of more than 5,000 physicians — provides a look into the issues affecting the financial and operational health of physician practices across the US, serving as a barometer of the current state of the average practice and providing insight into physician outlooks on the year ahead.
This year’s PPI revealed “room for cautious optimism”, with a lesser amount of physicians forecasting negative profitability than in the 2014 PPI. This year’s PPI also showed that, while respondents with positive projections still represent the smallest segment, physicians across the board are investing in practice operations to counter continued regulatory challenges, financial pressures, and administrative burdens.
In the 2015 Practice Profitability Index, Physicians expecting profitability the be flat over the coming year (35%) represented a greater share than those expecting a downward trend (31%) in profitability. Twenty-four percent of physicians anticipated a positive trend in profitability, up 19% from the 2014 PPI, and 10% of physicians were unsure of what they anticipated.
Overall, in contrast to prior years, this year’s Practice Profitability Index revealed a moderate upswing in physician profitability projections.
Continuing Challenges to Profitability
As physicians consider the year ahead, the top challenges they anticipate are:
- Declining Reimbursements
- Rising Costs
- The Transition to ICD-10
- The Affordable Care Act
- Time Spent Performing Administrative Duties
Declining reimbursement and rising costs were the top two challenges physicians cited in this year’s Practice Profitability Index, but the transition to ICD-10 replaced the Affordable Care Act at number three. More than half of physicians identified ICD-10 as a factor weighing down profitability and three in five expressed doubts about their readiness for it.
If your medical practice also anticipates these challenges in the upcoming year, consider contacting Benchmark Systems to demo our Revenue Cycle Management or Practice Management solutions. Our RCM and PM solutions can help ease your medical coding and operational woes.
Key Targets For Operational Improvements
This year’s Practice Profitability Index findings confirm that physicians continue to seek out more versatile, user-friendly systems for their key financial, administrative, and clinical needs. To do so, they are focusing specifically on ways to improve their billing & collections processes, staffing, and outdated systems & processes to drive performance. Physicians want to first adopt better analytics solutions and replace or implement their first electronic health record and/or practice management system. They also plan to outsource billing and collections.
Why are physicians replacing their Electronic Health Record or Practice Management systems? Thirty-nine percent of physicians say that their current systems lack integration with other technologies. Thirty-seven percent say that their current systems slow their physicians down. Thirty-three percent say their EHR or PM isn’t cost-effective, and 27% say their current system isn’t ready for ICD-10 or Meaningful Use.
Promising Developments for Improving Performance
When it comes to new developments, physicians are most excited about:
- Patient Engagement Programs
- Mobile Technologies
- New Alliances (Mergers, Ancillary Services)
- Population Health Management Tools
- Fee-for-Value / Quality Contracts
If your medical practice is also planning to replace outdated systems or implement your first EHR, PM, or RCM system, contact us at Benchmark Solutions to demo our five-star rated healthcare solutions.