MGMA Week in Review: Healthcare Policy, Rural Hospital Challenges, and Private Practice Growth
Download MP3Hi, everyone, and welcome to the MGMA Week in Review podcast. Daniel Williams here along with Colleen Luckett. We are editors and writers at MGMA and host of the MGMA Week in Review podcast, where each episode, we bring you the latest health care industry news, policy updates, expert insights, and then the stories we find interesting out in the field of health care and medical practices. So with that in mind, Colleen, what is going on in your world?
Colleen Luckett:Hey, everyone. This next one may not directly match your job title, but I wanted to share it because it highlights something we're all struggling with, the growing urgency for healthcare leaders to engage in policy and advocacy. In a new health leaders article titled A CNO Guide to Participating in Policy and Advocacy, editor G. Hatfield highlights why nurse leaders, especially chief nursing officers, need to engage in health care policy now more than ever. The article recaps this recent webinar called The Winning Edge for Advancing Nursing Advocacy and Legislation, featuring nursing leaders from UW Health, Denver Health, and the American Hospital Association.
Colleen Luckett:Panelists tackled some of the most pressing legislative issues affecting nurses today from skyrocketing rates of workplace violence to Medicaid rollbacks under the one big beautiful bill act, I guess they're calling it, OBA, which could severely impact rural hospitals and vulnerable patients. They emphasized that CNOs should track legislation on telehealth, APRNs, staffing ratios, and even childcare, build relationships with legislators and hospital associations, and use a combination of data and storytelling to drive policy change. So what's the takeaway for MGMA members? These nursing advocacy efforts touch every corner of medical practice leadership affecting staffing, safety, compensation models, and access to care. So even if you don't have nurse in your title, these policies shape the environment you operate in.
Colleen Luckett:And, hey, leaders, you don't have to do it alone because our own government affairs team here at MGMA is here to help you stay ahead of what's coming. So they analyze the legislative landscape. They advocate for our members, and they offer you the tools and updates you need to make informed decisions. So you can visit them on our website at mgma.com/government to learn more and get involved. Because leadership in healthcare doesn't just stop at the clinic door.
Colleen Luckett:It really needs to extend all the way to the policy making table. Okay, Daniel. Over to you.
Daniel Williams:Thanks so much for that, Colleen. And I just wanted to throw one other thing in about our government affairs team. They are leading an upcoming webinar. It's gonna be July 22. As with all of our webinars, it's at 1PM eastern time.
Daniel Williams:It is the 2025 Washington policy mid year update. They have a lot of ground to cover. They're gonna do that in an hour. And those are our most widely attended webinars. And I would think right now with all of the changes that are going on in health care with CMS, with Medicare, Medicaid, everything else that's out there, this will be huge.
Daniel Williams:So strongly urge you to attend that. We'll put a direct link to it, but you can go mgma.com/webinars, or we'll just give you a direct link to this particular webinar that's coming up again July 22. All right. So let's turn the page to our next story. And for this next one, we're looking at what's going on with rural hospitals.
Daniel Williams:Now Becker's Hospital Review is calling something that's going on with rural hospitals now a perfect storm. There are many challenges that are pushing many of these facilities to the brink. The article lays out the multiple pressures hitting rural hospitals all at once. Here they are: worsening staffing shortages, financial instability, and aging, often sicker patient population. More than 140 rural hospitals have closed since 2010, and over 600 more are at risk of closing in the near future.
Daniel Williams:This is according to the Center for Healthcare Quality and Payment Reform. And the consequences go far beyond healthcare. As Harold Miller, President and CEO of that center put it, When a rural hospital closes, the community often loses its biggest employer and residents have to drive an hour or more to get basic care. That has a domino effect, not just for patients, but for the local economy and the workforce. There's also the issue of out migration.
Daniel Williams:Rural patients traveling to larger systems for care, taking their insurance dollars with them. This weakens the financial foundation of their hometown hospitals, many of which are already operating in the red. Becker's also highlights how some hospitals are adapting. They're expanding telehealth. They're pursuing mergers or affiliations with larger systems.
Daniel Williams:And they're seeking support from new Federal programs like the Rural Emergency Hospital designation. This designation offers monthly facility payments to help keep doors open. But the takeaway is clear: these solutions need to scale quickly. The rural health care system is at a tipping point, And unless we see some meaningful systemic support, these communities could lose access to essential care. With all that said, Colleen, I'm gonna turn it over to you.
Colleen Luckett:Yeah. Let's get to some MGMA stat polling. So this week's poll gets right to the heart of what many of you are navigating right now, the sharp rise in operating expenses for medical groups. So our July 8 poll revealed that average year to date operating expenses are up about 11% in 2025 compared to 2024. And while all costs are rising, labor was cited by nearly two thirds of you, 65% as the biggest driver of those increases.
Colleen Luckett:And that was followed by supplies, technology, facilities, and then some other various categories. So a few highlights from the poll regarding labor from phased retirement nurses to in house RN fellowships. Staffing innovations are essential across specialties. Regarding supplies, leaders are eyeing biosimilars, vendor managed inventory, and GPO consolidation to manage volatility. With technology, security mandates and AI adoption are pushing spending higher.
Colleen Luckett:Risk assessments can offer insure insurer credits as short term relief. And then with facilities, subleasing energy saving upgrades, and in some cases, sale leasebacks can help free up capital in the long run. So the big takeaway for MGMA members, this article we have covering this step poll, it's loaded with practical insights for you. Looking to balance your immediate cost relief with long term strategic thinking, whether you manage a single specialty group or a multi specialty enterprise, there is something in here you can act on today, promise, while planning for your tomorrow. So you can read that full article on our website at mgma.com/stats, or we'll drop it, of course, in the show notes as we usually do.
Colleen Luckett:And then we have some related resources if you haven't checked it out yet. Our cybersecurity and medical practices playbook can help your practice stay prepared for those issues. And as always, if you want your voice to help shape insights like these, join the MGMA stat poll by texting stat, s t a t, to 33550. And you'll get all those poll questions in your text messages weekly. Daniel, back to you.
Daniel Williams:Alright. Thanks for that, Colleen. So for our next story, we're talking about something that doesn't always come up in day to day practice operations, but probably should, real estate. I've made no secret. I've mentioned it here before.
Daniel Williams:I spent eight years of my life covering commercial real estate in Southern California, and so these stories really get my attention. So when I saw this piece in medical economics, I paid attention. In this article, they pose a simple but critical question, Does your real estate support the growth plans of your private practice? And the answer for a lot of practices out there might be, Not really. The article breaks down why the space you're in, whether it's leased or owned, can either be a launch pad for growth or a bottleneck that holds you back.
Daniel Williams:One stat that stood out, up to 40% of independent practices are considering a move or a lease renegotiation in the next year and a half. That is a huge number, and it speaks to how real estate decisions are getting reevaluated post COVID, especially as more practices look to expand services or bring in new providers. The author of this article, Matt Corson, makes the point that it's not just about size, it's about flexibility and alignment with strategy. He says, It's not uncommon for a practice to sign a lease years ago that no longer matches the direction they're headed. Maybe you've added a new service line or maybe patient volume has increased, but the physical space hasn't kept up.
Daniel Williams:There's also a key financial piece here. Many practices are in what's called triple net leases, meaning you're on the hook for taxes, insurance, and maintenance in addition to rent. That can erode margins fast if you're not watching closely. And if you're in a building owned by a hospital or health system, you might not have the flexibility to grow on your own terms or even stay put long term if your goals diverge from theirs. Corson suggests conducting a real estate audit, basically taking stock of where you are now, what your lease terms look like, when they expire, and what your actual space needs are over the next five years.
Daniel Williams:Because real estate isn't just about square footage, it's a business decision. Are you near referral sources? Are you easy to access? Are you paying too much for a space that isn't actually serving your needs? So the takeaway here is don't wait until space limitations are hurting patient flow or staff morale.
Daniel Williams:Get ahead of it. Your building should support your practice, not the other way around. Colleen, what's our next story?
Colleen Luckett:Indeed. What's next? That's actually the big question on the minds of our medical practice leaders and all of us. And it's also the title of our brand new July issue of MGMA Connection Magazine. This month's issue builds off the conversations we had at the MGMA Focus Private Practice Conference in Minneapolis, where the release of our state of private medical practice 2025 report hit a nerve.
Colleen Luckett:Leaders across the board echoed a common frustration. You can't solve turnover without paying more, and you can't keep paying more without rethinking how your practice grows, staffs, and sustains itself long term. In his letter from the editor, our own Chris Harrop sums it up, the future of private practice isn't just a financial operational issue. It's a policy issue, a workforce issue, a leadership issue, and a story about how innovation, autonomy, and community based care can still shape health care from the ground up. This issue dives into creative staffing and hybrid team models, the impact of burnout and early retirements on leadership pipelines, the need for practice leaders to engage with policymakers as we talked about today, and the bold steps practices are taking to preserve autonomy without burning out their teams.
Colleen Luckett:So what's the big takeaway for you all? Whether you're focused on compensation, succession planning, or care delivery redesign, the July NGMA Connection issue offers insight and inspiration, we hope, to help you move from survival to strategy. So check out the issue now at mgma.com/connection. And, hey, let us know what sparks your next idea. And that's a wrap for me today, Daniel.
Colleen Luckett:Back to you.
Daniel Williams:Alright. That is gonna do it for this episode of MGMA's Week in Review podcast. Boy, this was an episode chock full of really important information and just wanted to highlight again some of the information in there, particularly that government affairs upcoming webinar. We will be sure and put that information in the episode's show notes for July 22. There's gonna be a lot of great information in there.
Daniel Williams:So until then, I hope you all have wonderful weekends, and we'll see you again next week.
Colleen Luckett:Hang in there, everyone. See you next week.
