MGMA: EHRs improve the bottom line for physician practices

Independent physician practices can earn nearly $50,000 per full-time-equivalent physician with an EHR than those still stuck in the paper world, the Medical Group Management Association reports.

The report, based on a survey of MGMA membership, found that EHR-equipped practices not owned by hospitals or integrated delivery networks had $178,907 in higher median revenue per FTE physician in 2009 than similar practices without an EHR. Though operating costs were $105,591 higher per doctor with an EHR, the net result was $49,916 greater operating income for each FTE physician.

Multispecialty practices owned by hospitals or IDNs did nearly as well, reporting a mean $42,042 higher operating margins with EHRs than without, according to the MGMA, which released the study Monday at the organization's annual conference in New Orleans.

Benefits tend to rise over time, as well. Independent practices that have had EHRs more than five years had operating margins 10.1 percent greater than practices in their first year of EHR usage. That is largely because the highest implementation expenses tend to occur in the first year, after which time practices often see costs go down for transcription and medical records staff.

"Adopting an electronic system can be costly and time consuming, and understanding the impact it will have on the practice is critical," said MGMA President and CEO Dr. William F. Jessee said in a prepared statement. "While the implementation process can be very cumbersome, these data indicate that there are financial benefits to practices that implement an EHR system."

Still, Jessee said he expects many practices to struggle in their quest to earn Medicare and Medicaid incentive payments for "meaningful use" of EHRs starting in 2011.

For additional details:
- check out this CMIO story
- view this MGMA press release
- find out how to order the MGMA report