News: Physician practices experienced strong recovery from COVID-19 in 2021

According to the January 2022 Physician Flash Report by Kaufman Hall, in 2021 physician practices saw a rise in patient volume, productivity, and revenue. The performance in these areas was found to exceed pre-pandemic levels for the year.

Compared to the last quarter of 2020, physician productivity in 2021 increased by 21.9%. Productivity also increased by 3.5% from the fourth quarter of 2019, making the 2021 productivity levels higher than pre-pandemic.

The rise in physician productivity created growth in practice revenue, showing in increase of 7.4% in the fourth quarter of 2021 compared to the third quarter.

Physician compensation for full time employees also improved compared to 2019 and 2020, with the report showing the median income in the fourth quarter of 2021 to be $342,198 for a 3.3% increase compared to the third quarter of the same year.

Primary care facilities saw the greatest growth in revenue per physician with 12.9% increase from the third quarter of 2021 to the fourth. Analysts of the report note the rise was likely due to more patients seeking care that had been delayed during the pandemic, as well as patients seeking care before 2022 copays began.

Even with all the promising growth, net revenue per physician work relative value unit stayed beneath 2020 levels. Although physician practices are seeing growth in productivity and revenue, they are also seeing a rise in expenses. In 2021, the total direct expense per physician reached $955,281, up 9% compared to 2019, and up 16.3% compared to 2020.

Editor’s note: The Kaufman Hall January 2022 Physician Flash Report can be found here. ACDIS coverage of physician compensation tied to volume rather than value can be found here.