Category Archives: Physician Productivity

Poll results: AGI and the future of medicine

Posted on by • Posted in Artificial General Intelligence (AGI), Artificial Intelligence, Clinical Diagnosis, Clinical Innovation, Future of Medicine, Physician, Physician Practice Management, Physician Productivity • Tagged , , , , • Leave a comment
Poll results: AGI and the future of medicine

Artificial general intelligence (AGI) refers to AI systems that can match or exceed human cognitive abilities across a wide range of tasks, including complex medical decision-making.

With tech leaders predicting AGI-level capabilities within just a few years, clinicians and patients alike may soon face a historic inflection point: How should these tools be used in healthcare, and what benefits or risks might they bring? Last month’s survey asked your thoughts on these pressing questions. Here are the results:

My thoughts: 

I continue to be impressed by the expertise of readers. Your views on artificial general intelligence (AGI) closely align with those of leading technology experts. A clear majority believes that AGI will reach clinical parity within five years. A sizable minority expect it will take longer, and only a small number doubt it will ever happen.

Your answers also highlight where GenAI could have the greatest impact. Most respondents pointed to diagnosis (helping clinicians solve complex or uncertain medical problems) as the No. 1 opportunity. But many also recognized the potential to empower patients: from improving chronic disease management to personalizing care. And unlike the electronic health record, which adds to clinicians’ workloads (and contributes to burnout), GenAI is widely seen by readers as a tool that could relieve some of that burden.

Ultimately, the biggest concern may lie not with the technology, itself, but in who controls it. Like many of you, I worry that if clinicians don’t lead the way, private equity and for-profit companies will. And if they do, they will put revenue above the interests of patients and providers.

Thanks to those who voted. To participate in future surveys, and for access to timely news and opinion on American healthcare, sign up for my free (and ad-free) newsletter Monthly Musings on American Healthcare.

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Dr. Robert Pearl is the former CEO of The Permanente Medical Group, the nation’s largest physician group. He’s a Forbes contributor, bestselling author, Stanford University professor, and host of two healthcare podcasts. Check out Pearl’s newest book, ChatGPT, MD: How AI-Empowered Patients & Doctors Can Take Back Control of American Medicine with all profits going to Doctors Without Borders.

Physician productivity up 4% as revenue, expenses rise

Posted on by • Posted in Key Metrics, Key Performance Indicators, Labor Spend Management, Operating Expenses, Operating Income, Operating Margin, Operating Metrics, Operating Performance, Physician, Physician Productivity, Physician Staffing, Relative Value Units (RVU), Worked Relative Value Units (wRVU) • Leave a comment
https://www.beckershospitalreview.com/finance/physician-productivity-up-4-as-revenue-expenses-rise.html?origin=BHRE&utm_source=BHRE&utm_medium=email&utm_content=newsletter&oly_enc_id=2893H2397267F7G

Expenses per provider remained considerably higher than revenue generated in the first quarter of 2024, although there are signs the gap could be closing, according to the Kaufman Hall “Physician Flash Report,” released May 2.

Kaufman Hall based their findings on a monthly report from Syntellis Performance Solutions, part of Strata. The report gathered data from more than 200,000 employed providers, including physicians and advanced practice providers.

Net patient revenue per provider full-time equivalent was $383,881 for the first quarter, up 4% from the same period last year. Total direct expenses per provider FTE hit $620,729 for the quarter. Expense growth has slowed over the last three years, with a 5% growth from 2022 to 2023 and just 3% growth from 2023 to 2024.

“Labor expenses are a growing proportion of total expenses, a trend that is unlikely to change significantly. Organizations should shift from optimizing downstream revenue to optimizing downstream margins,” the report authors advised, noting hospitals and physician organizations can evaluate provider specialties by outcomes or other metrics when they aren’t big revenue drivers.

Provider productivity was up 4% as measured by work relative value units. Physician wRVU per FTE was 5,979 for the first quarter, up 6% year over year. Physician compensation jumped 3% to $364,319, down from 6% growth between 2022 to 2023.

Labor expenses continue to rise while support staff decline across specialties. Labor was 84% of total expenses in the first quarter, and support staff per 10k provider wRVUs dropped 6% year over year to 3.14, even after an 8% drop from 2022 to 2023. Report authors recommended organizations find better ways to use APPs for higher physician productivity.

Here are specific data points from the first quarter report.

Median net patient revenue per provider FTE by specialty cohort were:

1. Primary care: $471,000
2. Medical specialty: $377,000
3. Surgical specialty: $393,000
4. Hospital-based specialty: $250,000

Median physician wRVU per physician FTE by specialty cohort was:

5. Primary care: 5,560
6. Medical specialty: 6,742
7. Surgical specialty: 6,626
8. Hospital-based specialty: 5,239

Median physician paid compensation per physician FTE by specialty cohort:

9. Primary care: $297,000
10. Medical specialty: $412,000
11. Surgical specialty: $480.000
12. Hospital-based specialty: $360,000

Median support staff FTEs per 10,000 wRFUs by specialty cohort:

13. Primary care: 4.48
14. Medical specialty: 2.47
15. Surgical specialty: 2.87

Chasing downstream margin over downstream revenue

Posted on by • Posted in Health System, Hospital, Hospital Industry, Labor Spend Management, Operating Expenses, Operating Margin, Operating Margin Drivers, Physician Compensation, Physician Downstream Margins, Physician Employment, Physician Incentives, Physician Productivity, Physician Reimbursement • Leave a comment

https://mailchi.mp/fc76f0b48924/gist-weekly-march-1-2024?e=d1e747d2d8

A recent engagement with a health system executive team to discuss an underperforming service line uncovered a serious issue that’s becoming more common across the industry. 

“Our providers are more productive than ever,” the CFO informed our team, “and yet we keep losing money on the service line.” 

After digging into their physician compensation model, we came upon one source of the system’s issue. Because it was incentivizing physician RVUs equally across all payers, its providers responded, quite rationally, by picking up market share where growth was easiest: Medicaid patients, who weren’t generating any margin. 

“We recognize that we’ve been employing these physicians as loss leaders in order to generate downstream revenue,” the CFO shared, “but what’s the point of that revenue if there’s no longer any downstream margin?”
 


The economics of physician employment becomes a tough conversation very quickly; it’s a sensitive topic to many, and one with myriad facets. 

But the loss leader physician employment model obviously only works when it produces positive downstream margins. 

We’re in a critical window of time, where hospital margins are just beginning to recover as volumes return—but those volumes are not necessarily in the same places as before. 

The opportunity is ripe for systems to work closely with their aligned physicians to reexamine the post-pandemic margin picture for individual service lines and ensure incentives are aligning all parties to hit operating margin goals. 

Are these kinds of conversations taking place at your health system?

Physician Flash Report: Q3 2023

Posted on by • Posted in Physician Compensation, Physician Productivity, Physician Subsidy • Leave a comment
https://www.kaufmanhall.com/insights/research-report/physician-flash-report-q3-2023?utm_source=mkto&utm_campaign=physician-report&utm_medium=em&utm_term=q3-231102&mkt_tok=NjU0LUNOWS0yMjQAAAGPL9fvKzCCo1yvOrGiSvhy0-t5–VjENs1Ks4XXQJpQy7Z-G6Vx0UmDTOTaG6FKy-rttEiqWJglijrIfiQmyiVBmAI2zvwD0HdugwfVHjZ7iHm

Above Chart: Q3 2023 Key Performance Metrics Summary

Physicians are operating at record-high levels of productivity compared to recent years but receiving less pay per unit of work. The median investment/subsidy per provider continues to increase, but the pace is slowing with only a 1% change from Q3 2022 to Q3 2023.

The October issue of the Physician Flash Report features the most up-to-date industry trends drawn from the same data physician groups use to track their finances and operations. For more detailed benchmarks by specialty or custom peer groups, please email PhysicianFlashReport@kaufmanhall.com.

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