Pediatric groups' revenue increase falls behind boost in practice costs














Revenue in pediatric medical practices has not kept pace with cost increases, according to the Medical Group Management Association Survey for Pediatric Practices: 2004 Report Based on 2003 Data.

Groups with nine or more physicians report greater revenue per doctor than smaller practices.

The large groups reported revenue, after operating costs, of $226,489 per full-time equivalent (FTE) physician. Smaller groups can't take advantage of economies of scale and staffing efficiencies, suggests Nancy Babbitt, a practice administrator at Roswell Pediatric Center in Alpharetta, Ga.

"Larger practices can also afford to employ a board-certified administrator. This may help those groups negotiate better rates, provide benchmarks for the practice in comparison with its peers, run the practice more efficiently, and capture more revenue," says Babbitt.

Overall, pediatric physician groups reported a 10.3 percent increase in revenue, but a 12.5 percent increase in total operating costs over five years. To offset costs, 16.6 percent of groups charge patients administrative fees to complete forms.

"Malpractice insurance increases and stagnating or decreasing payments are just two factors pushing pediatric and primary care groups' margins to untenable lows," says Babbitt.

Source: Medical Group Management Association Cost Survey for Pediatric Practices: 2004 Report Based on 2003 Data.

Career Opportunities

HAP, a subsidiary of Henry Ford Health System, is a nonprofit health plan providing coverage to individuals, companies and organizations. This executive develops strategies to meet membership and revenue targets through products, pricing, market segmentation and advertising.  Aligns business among Business Development, Commercial Sales, Medicare and Public Sector Programs and Product Development. Seeks to enhance and be responsible for business development and expansion through the development of an effective product portfolio, strong interpersonal relationships and service excellence.

Apply via email to jfedder1@hfhs.org or online at http://p.rfer.us/HENRYFORDlXqAJA

Subscribe to Our Newsletters

Monthly table of contents

Be notified as each issue of Managed Care is available online.

Biweekly newsletter

Recent topics have included:

PTCommunity news

New drug approvals, clinical trials, drug management. Three times per week.

UP NEXT

Managed Care
By Peter Wehrwein
Managed Care
By Howard Wolinsky