Peter Reilly 0:00
I think for most US industries, we're past covid. I'm not sure healthcare has ever quite gotten out of that hangover. Welcome to

Austin Littrell 0:21
off the chart of business and medicine. Podcast featuring lively and informative conversations with health care experts, opinion leaders and practicing physicians about the challenges facing doctors and medical practices. My name is Austin Montrell. I'm the associate editor of medical economics, and I'd like to thank you for joining us today before we get started. Just a quick note, physicians practice will be hosting a practice Academy event on March 19. The new practice management track is a virtual learning experience designed for physicians and practice administrators who want to build a stronger, more efficient and more resilient practice. It focuses on practical, real world strategies that you can apply right away from optimizing operations to adapting to an evolving healthcare landscape. You can register today by clicking the link in the show notes or going to register.physicianspractice.com that said in today's episode of medical economics, managing editor Todd schryah caught up with Peter Riley, North American healthcare practice leader at HUB International. They're talking about the growing list of pressures that physicians are facing in 2026 from reimbursement uncertainty and rising labor costs to stabbing shortages, liability risks, cyber security threats. Riley shares what he's seeing across the market, why some risks are getting harder to ignore, and where practices still have blind spots. So Peter Reilly, thank you so much for joining us today, and now let's get into the

Todd Shryock 1:31
episode. Peter, thanks for

Peter Reilly 1:32
joining me. Todd, nice to see you again. Always a pleasure.

Todd Shryock 1:35
So physicians are facing a host of challenges, Medicare, Medicaid cuts, delays and payments from insurers, rising labor costs and supply cost increases. What's driving all these challenges, and do you see them getting any better in 2026

Peter Reilly 1:52
Well, unfortunately, the short answer is, I don't see them getting dramatically better in 2026 I think if there's a bit of a silver lining, and I'm not sure this is me being a little optimistic, but so much of the pressures that physicians are facing are really, I think, baked in the sort of uncertainty as to how the US market is going to reimburse physicians. CMS has and tried to do, come up with several solutions that the lack of consistency, I think, really creates a lot of that uncertainty. And so, if nothing else, as we sit here and record today, real concerns around the ACA subsidies, and you know, I've got a good friend who says math is math. Eventually this is going to work out that we need to pay our providers to continue to have the quality health care. So if there's a silver lining, it's a the economics eventually are going to catch up with the reality. But at least in the near term, it's going to continue to be incredibly challenging, because there's so much uncertainty. And, you know, the labor shortage continues, because I think it's a fair question for a lot of people to say, why would you want to work in this environment when everybody's questioning their trust in health care providers, which I find astonishing. You know, vaccines effectiveness, it's just the list goes on that I think for most US, industries were past covid. I'm not sure healthcare has ever quite gotten out of that hangover.

Todd Shryock 3:34
Another troubling trend is that rural hospitals continue to struggle in 2025 but even with government assistance, the outlook isn't great. Going into 2026 should physicians at these facilities or those that do business with them, be worried about their future?

Peter Reilly 3:55
Sadly, I think the answer is to a certain degree, yes, critical access hospitals, federally qualified health clinics, continue to face the, you know, unfair brunt of so many of these economic challenges. And so I think any physician or medical professional needs to at least ask that question. Now on the flip side of that, I do think those providers often still provide some of the very best bedside medicine. There is rural healthcare is where so much healthcare is still delivered on a one to one very personal basis, and a little bit of what I alluded to a moment ago, the political wins for where some of the power resides, in Washington around rural health care are going to see some of those economic challenges, and they will need to respond otherwise. I think it is particularly dire, but I think those practitioners need to ask. The question is the critical access hospitals are doing all that they can. They should go lockstep with them to their local, state and federal representatives to really demand action. But I'm sorry to say it is a question they should at least be asking. And there are some other solutions for potential partnerships, but there is no point in pretending the challenges and those headwinds don't exist,

Todd Shryock 5:29
burnout and a lack of engagement continue to be challenges in healthcare. Is there anything a physician practice owner could do to help mitigate the mental strain for his or her employees to increase retention.

Peter Reilly 5:42
You know, Todd, that is a great question, and I know, I'm sure you have had that question to put to many other professionals that work in this space. But I'm happy to say, if there is a true silver lining that can be impacted now, this is it, the creation of wellness plans, and those were misnamed, I think, around employee assistance and other sort of soft benefits, historically, from an employee benefit, or, you know, medical insurance standpoint, there are so many other tools that are now available, and these tools have grown up relatively recently. So it's not like they've missed an opportunity, but from financial wellness, having scheduled flexibility, the use of technology, as you and I sit here and do this over, you know, a virtual meeting, those tools and capabilities are much more readily, readily available than they used to Be. And so I think physicians can look to be a little more entrepreneurial and offering some of those services to their staff. You know these folks, from the individual at the front door all the way through to the best you know pas or nurses do face a hostile crowd sometimes, and burnout and so many challenges that to think beyond just flexible work schedules and nice employee benefits is helpful. Those pressures go into financial wellness. Those pressures go into some extra time off for family when needed, and so there is a move with greater tools for that type of flexibility that I would encourage physicians and physician practices to explore. They're not necessarily off the shelf, but they are out there, and with a little bit of digging, I think some of those can be very effective in continuing the loyalty that so many physician offices have with their staff.

Todd Shryock 7:39
One of the things that physicians are always interested in is the medical professional liability market. What's happening in that market, and how will it affect rates in 2026

Peter Reilly 7:52
Well, the is always the joke goes. Let me start with the good news before I get to the bad news. The good news is there's still plenty of market competition. It has. There's seen, there has been announced, some market consolidation that I think ultimately will be good for the business, because you'll have stronger MPL carriers who can compete nationally and even across state lines. Again, there's now technology and better understanding from underwriters around virtual care and telehealth and the need to cross state lines, and so coverages are not as restricted. The bad news is the combined ratios for the vast majority of MPL underwriters remains north of 100 even 105 meaning they're losing money on underwriting. The market has made up some of that, but a lot of that is being driven by the social inflation and what a defense attorney friend of mine referred to as, you know, angry jury pools that are awarding just outsized risks, excuse me, awards to the risks associated with a case. So those are the headwinds the industry is facing. I don't see medical professional liability getting much cheaper, but for those practices that really lean into and take advantage of the tools that so many of those carriers offer, the use of AI around getting data with claims or other things come in, it can begin to bend the curve a little bit, because there is so much more ability to get that data quickly and then act on it that I think that's what's encouraging. And we are seeing some of the rate increases mitigate so it is a softening rate increase going on in the marketplace, but you're also seeing some of the more responsible underwriters really perform well and then have the ability, maybe not the first half of 2026 but I would expect, possibly toward the second half, good competition for, again, what I will call the top. Tier carriers that are still committed to the physician and surgeons market.

Todd Shryock 10:06
I've heard you use the term before of nuclear verdict to describe some of those outsized jury awards, but I actually saw another term this morning, thermonuclear verdict to describe the even bigger awards. I mean, are those becoming more common, or what's happening?

Peter Reilly 10:29
Sadly, yes, the number of cases in excess of $10 million and that was sort of the old bar for what was a nuclear verdict. Those numbers are simply going up. But the thermonuclear verdicts, and I've seen bars as low as 20 million, as high as 40 million, those are happening more and more frequently in markets. And by that, I mean geographically, that it just didn't even as little as 510, years ago, the jury pool, the awards that are being given, as I mentioned a moment ago, it's almost irrational, because there's a feeling that growing distrust in health care, that somehow the punishment needs to happen. And there's a mindset that it's not just the doctor, oh, it's the insurance company paying for it, and therefore they've got the deep pockets. Well, the doctors pay for that in the end, as we all know. So it is a move towards more of these. But there's also been some movement in a handful of states on what I will call reasonable tort reform. I'm not a huge fan of tort reform all the time because I think it can be an overreaction in the reverse. But there are states now where there's some some positive movement in tort reforms that every physician should engage with their respective state association or other group to put those things on the agenda for because it has to be done at the state level, and push back that there are certain parts of the country where we're going to get, you know, primary care and general care deserts, because it's just not worth it. And the case or state where there's probably most evidence of that currently is in New Mexico, that wonderful place to live great quality of life, but the jury awards are just off the charts. And so in addition to the traditional, you know, more urban county sometimes where we see those so it's a disturbing trend, to be sure, but the insurance industry, in partnership with the AMA and some other state associations are much more on the front foot to again, push for reasonable tort reform that again, I would encourage every one of your readers to participate, you know, letter writing campaigns, whatever they may be, because that's how this is going to change. Right now, the economic uncertainty in the country, I don't think, sets a very good tone to have the juries tamp down something like that. So action is what is necessary,

Todd Shryock 13:06
and as if there's not enough challenges, hackers also continue to target health care facilities of all sizes, including medical practices. How can practices manage the risk, not just in their facility, but also the risk posed by the vendors that they rely on to do business.

Peter Reilly 13:25
And it is the second part of that question that is one I think so often physician practices either ignore because they don't want to think about it, or presume that it relieves them of some risk. The good news is we are seeing the frequency of the attacks get through to physician practices, and that's a credit to them and their respective vendors, who are and have taken proactive steps, but the severity is still there. There's some still very big awards, and healthcare remains such a prime target because of the information that is collected. There are two things that I think physician office really needs to to do if they haven't already. And one is a change of mindset, mindset. The other is an action one. And we have seen too many instances where physicians have said, Oh, those medical records go off into the cloud. They're not mine. I don't have them. That is wrong. And if you presume that and expect that somehow that's going to relieve you of duty in the event of a regulatory violation, I think that would be a very rude awakening. So that is really number one, is understanding what the regulations are in your jurisdiction, as to when you own the records and how much responsibility you have. The second piece is really working with a good privacy council that can look at your contracts with these vendors and put in language that is as beneficial to the physician practice as possible in the event that it is. The vendor that has the breach, because in truly those instances, it is not the physician's fault the breach happened, but it is still their obligation to protect the records. So those two things, I think, are probably the mindset that needs to come about, because there's plenty of cyber liability insurance out there now, and the tools that come with them, those policies from almost every quality carrier are really top notch, and physician should take advantage of those. Have someone really dig in and use all those tools, because the carriers don't want to pay the claims either, but understanding the risk even as a small practitioner, is the best first line of defense, because doing then something is so much better than doing nothing. And while it is less frequent, we still see cases where the physicians simply don't have the resources to deal with a loss. But again, there are things that can be done, and the contract with your vendor and working with your carrier are the two actions that they can and should take, and it doesn't take that much time. I'd strongly, strongly encourage them to dedicate some early time in the year to to just be sure they're refreshing their you know, cyber defenses. You

Speaker 1 16:29
Hey there. Keith Reynolds here and welcome to the p2 management minute in just 60 seconds, we deliver proven, real world tactics you can plug into your practice today, whether that means speeding up check in, lifting staff morale or nudging patient satisfaction north, no theory, no fluff, just the kind of guidance that fits between appointments and moves the needle before lunch. But the best ideas don't all come from our newsroom. They come from you got a clever workflow, hack, an employee engagement win, or a lesson learned the hard way. I want to feature it. Shoot me an email at K Reynolds, at mjh, lifesciences.com, with your topic, quick outline or even a smartphone clip, we'll handle the rest and get your insights in front of your peers nationwide. Let's make every minute count together. Thanks for watching, and I'll see you in the next p2, management minute,

Todd Shryock 17:21
larger organizations often create a robust risk management plan. Is this something a medical practice should consider doing? And if so, what would it look like?

Peter Reilly 17:31
That's probably the easiest question you've given me yet. Todd, and I appreciate that now the answer is yes, they should, because it is an enterprise, sort of enterprise wide risk management mindset that, again, is really what is protecting those larger organizations. They are thinking about what could go wrong and hope is not a strategy. There's actual planning and those steps which large hospitals and multi state, very large medical groups have undertaken. The the ability now to call up a basic enterprise risk management plan through AI is a great place to start. You know, for physician practices, put in the number of physicians or medical professionals where you're located, you know, those types of things, and you will begin to get a good early draft of a risk management program, and that's very inexpensive, compared to one in the past was inspectors coming in and having to write entire manuals. That's where technology really can be used to their advantage, and then insurance intermediaries and brokers like hub, but then carriers will also supplement that with a number of very specific pieces of information, such as ingress and egress and how you want to make sure that patients and family members You know, can come and go from the facility, the handling of patients. All those things, workers compensation is another key one in healthcare. All those things are 80% 85% written for practices, and they should take time to adopt them and review them periodically, because it is those proactive steps, because we will always have risk, but when an underwriter can understand you have taken, you know, effective and proactive mitigation efforts, that's where the premiums are truly impacted, and practitioners can be rewarded for doing the right thing. And there's also a body of movement, excuse me, a body of thought now with some data to back it up, that when you do take those proactive steps, the quality of care goes up, and that has a direct impact on the medical professional liability piece that will continue to develop with AI, but that's where i. Would recommend they start, and I would encourage them to do it. And it's again, I think if you pick your AI tool, you can have a first draft in a matter of minutes.

Todd Shryock 20:10
I'm curious, do you find when you talk about risks with these businesses, do they sometimes not realize some of the risks they face, like they say, Oh, I never thought about that risk to my business. You know, I do you find that they have blind spots. I do and

Peter Reilly 20:32
and I think that's really the case across many physician practices, not because they aren't thoughtful or careful, but most of the times, physician offices are set up as clinical operations, and so much of what is built is done from a clinical perspective, and not that that isn't vitally important, but issues of risk tend not to be the types of things that physicians and surgeons are trained to think about beyond the clinical perspective, and an office manager can do it, but so often they become glorified accountants, and someone needs to pay attention to the pennies and the dollars. But we see that that's sometimes where they stop. And there is it's less and less, but still their reaction of, Oh, I'm just a small business. You know, nothing really bad is going to happen. But a quick example to where I think there's a real need for an evaluation is if you have any type of storefront, you know, medical care, a dentist office, an urgent care facility that's owned by a couple of doctors, you know, the parking lot is, quite candidly, one of your biggest risks of someone, purely by accident, running the car through the front doors. And there are hundreds of those instances every month in America, though often the restaurants and other things. But with more and more storefront healthcare coming about, that risk is very real, and there's some very simple steps that can be taken to begin to mitigate, but that's a great example Todd of exactly, I think the impetus to your question, it was like, Oh, I never really thought about that. We don't see it every day. But again, when put in the macro sense, it's a real risk. And unfortunately, those tend not to end well,

Todd Shryock 22:23
yeah, someone driving a car into the side of your building and taking out three of your exam rooms. Where are you going to see patients? How long is it going to take to get fixed?

Peter Reilly 22:33
That is correct. And then even worse, if patients were actually in those exam rooms, is the real but you, you make a great point, even if it were to happen late at night, if you cannot see those patients, you cannot bill and you run into sort of perpetuating problem that snowballs into what who would have thought someone driving into the side of your building? So that is a long winded way of saying, Yes, we still see that periodically. But again, there are so many tools and resources now, very inexpensively, if not at no cost, available through insurance intermediaries and carriers that they just have to ask,

Todd Shryock 23:16
what else do doctors need to be thinking about regarding risk in 2026

Peter Reilly 23:22
Well, I guess the the two biggest ones that that we are are seeing, and this is not meant as a political statement in any way, shape or form, but when we can have sort of the floods and horrific natural disasters that came to, you know, western North Carolina and parts of Tennessee, the Pacific Northwest, saw a picture of a valley two miles wide that looks like a lake. There are some good old fashioned, you know, weather and exposure risks that physicians need to think about that. What happens if I can't either get to my office to treat patients? If it happens while I'm in my office with patients and just with the increase in natural disasters, and they can be defined very widely, some good old fashioned planning about things like that become important, because if it goes wrong, it can go very wrong. And then the other piece, and I'll be a bit of a broken record here, but real financial planning for the business becomes warranted, not just on a once a year basis, because what we're seeing is the politics in Washington and elsewhere may change your revenue streams and the lines of service that you can even offer if you have multi line or any type of patient care, surgery or some piece those types of business reviews need to be undertaken more frequently than in the past, and they don't need to be three and four hour meetings. But it's a, it's a case of, I joke with many of our clients that, you know, we're paid to be pair. Knowing for you, and having a little discussion about what could go wrong, then really, truly assessing what might but again, who thought in western North Carolina that they were going to be underwater, the need is to think for the what if, and then really, at least have a cursory plan to start, but again reviewing it on a regular basis, I think we'll pay dividends to physician practices, because then they can still practice medicine, as opposed to reacting all the time.

Todd Shryock 25:33
Very good. Peter, thanks for joining me.

Peter Reilly 25:36
My pleasure, always a pleasure to talk to you, and thank you for continuing to ask the questions on an industry that is constantly facing pressures well beyond anything you and I talked about today. But thanks again. Once

Austin Littrell 26:00
again, that was Peter Riley, North American healthcare practice leader at HUB International, speaking with medical economics Managing Editor Todd schreich. My name is Austin Luttrell, and on behalf of the whole medical economics and physicians practice teams, I'd like to thank you for listening to the show and ask that you please subscribe so you don't miss the next episode and don't forget, physicians practice will be hosting a practice Academy event on March 19, featuring a new practice management track with practical, actionable education for physicians and practice administrators, you can register today by clicking the link in the show notes or going to register@physicianspractice.com be sure to check back on Monday and Thursday mornings for the latest conversations with experts, sharing strategies, stories and solutions for your practice. You can find us by searching off the chart wherever you get your podcasts. Also, if you like the best stories that medical economics and physicians practice published delivered straight to published delivered straight to your email six days of the week. Subscribe to our newsletters at medical economics.com and physicians practice.com off the chart, a business of medicine podcast is executive produced by Chris mazzolini and Keith Reynolds and produced by Austin Luttrell. Medical economics and physicians practice are both members of the MGH Life Sciences family. Thank you.