Nearly half of practices spend more than $40K per physician to comply with federal regulations

Physician practices are racking up dollars trying to comply with new and existing federal regulations, according to a new Medical Group Management Association (MGMA) survey.

Nearly half of the 750 group practices surveyed said they spend more than $40,000 per full-time physician each year, directly or indirectly, to comply with federal regulations, according to the MGMA survey report (PDF).

The most burdensome regulation? It’s Medicare’s new Merit-Based Incentive Payment System (MIPS) program, cited by 82% of respondents as “very” or “extremely” burdensome. Medical groups cite clinical relevance to patient care (80%) as their top MIPS concern.

Other top regulatory concerns:

  • A lack of national electronic attachment standards for claims and prior authorizations (74%)
  • Audits and appeals (69%)
  • Lack of electronic health record interoperability (68%)
  • Payer use of virtual credit cards (59%)

The criticisms of MIPS

Practices see little clinical benefit in MIPS, the new Medicare payment system that began this year. Some 73% of respondents view MIPS as a government program that does not support their practice’s clinical quality priorities, the survey found. 

However, the vast majority of respondents are participating in MIPS in 2017 and 72% plan to exceed the minimum reporting requirements to help earn higher payments.

The complexity of MIPS is a barrier to success, the survey found. More than 70% of respondents said the scoring system is very or extremely complex and 69% are very or extremely concerned the unclear program guidance will impact their ability to successfully participate.

“The resources it will take to comply with MIPS are absurd, and the only thing the program measures is the ability to meet documentation requirements,” one respondent commented.

There is hope the requirements will get less onerous. Physician groups said that the Centers for Medicare & Medicaid Services listened to doctors' concerns in drafting proposed changes to the Medicare Access and CHIP Reauthorization Act (MACRA) for 2018—the second year of the program—designed to make it easier for small, independent and rural practices to participate. It also increases flexibility and reduces the burden on doctors and other clinicians by simplifying reporting requirements.

RELATED: Doctor groups upbeat about proposed 2018 MACRA changes

Doctors are also finding that Tom Price, an orthopedic surgeon who is secretary of Health and Human Services, is fighting their battles in Washington. Price has been working quietly to reverse Obama administration directives, acting to protect doctors from regulations put in place in the prior eight years.

Regulatory burdens take focus from patients

The results of the survey reveal there is no shortage of opportunities to reduce regulatory burdens on physician practices.

"The magnitude of regulatory demands on physicians forces medical group practices to needlessly focus precious time and resources on administrative tasks instead of patient care," Halee Fischer-Wright, M.D., president and CEO of MGMA said in an announcement.

The group called for a national effort to relieve physician practices from excessive government regulations and wants to work with the administration and congress to find solutions.

The cost to practices to comply with regulations comes at a time when medical groups are transforming the way they do business to improve the coordination of patient care and enhance operational efficiency, the group said. More than 80% of respondents agree or strongly agree that a reduction in Medicare’s regulatory complexity would allow their practice to reallocate resources toward patient care.  

“Most of what we do to meet requirements is busy work that has no real impact on patient care,” wrote one survey participant.

RELATED: With Tom Price in charge at the Department of Health and Human Services, doctors are winning in Washington

“The regulatory and administrative burdens have dramatically increased over the past few years. However, the biggest problem isn’t the increase itself, [it’s] that the increase is for no good purpose (does not improve care, distinguish between good and bad clinicians, save money, etc.),” wrote another.

One way the government could save practices money, cited by 93% of respondents, is to create a single provider credentialing source for Medicare, Medicaid and commercial payers.

“Centralizing and simplifying initial and re-credentialing [of clinicians] would save our practice hundreds of dollars a year,” said one survey participant. The largest representation among survey respondents was from independent medical practices with six to 20 physicians. A summary (PDF) of the survey findings is also on the MGMA website.