0:00
Physicians go to med school to do good, not do paperwork, and I'm really excited about the potential of these AI tools to return the joy to medicine. And that's a noble goal in and of itself, and I think that's great, but that also translates into good economic things too. So a happier Doc is going to be more productive, they're going to provide better care and they might extend their careers.

0:34
Welcome to off the chart, a business of medicine podcast featuring lively and informative conversations with healthcare experts, opinion leaders and practicing physicians about the challenges facing doctors and medical practices. My name is Austin Latrell. 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 practice Academy's new practice management track on Thursday, March 19. The Virtual Learning Experience is designed for physicians and practice administrators looking for practical, real world strategies to strengthen operations, improve performance and build more resilient practices. Speakers for the event include Anders Gilberg of the Medical Group Management Association, Bronson Cox of minkota, Justin Lamb of cool blue, VA and Mark Herzog of Vera dime. You can register today by clicking the link in the show notes or by going to registration at.physicianspractice.com

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that said in today's episode, I sat down with Dr Shannon, Sims, Chief Product Officer at Visian, and Matthew Bates, Managing Director at Kauffman Hall. We were talking about visians 2026, state of the industry report and what it describes as a reset moment for healthcare. They break down what that reset actually means for physicians on the ground, how artificial intelligence is moving from hype to workflow, why access is becoming the defining operational challenge, how advanced practice providers are reshaping team models, and what cost pressures are doing to the economics of healthcare. Dr Sims and Matthew Bates, thank you both for joining us. Now, let's get into the episode.

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All right, Shannon Sims and Matthew base, thank you both so much for joining me today. We're going to be

2:07
talking about vizient state of the industry report for 2026

2:12
before we get started, would you both mind just quickly introducing yourselves and vizient and coffin Hall? I'm Shannon Sims. I'm our chief product officer. I've had an unusual path to that role by background. I'm an internal medicine physician and a PhD clinical informaticist, so really happy to be here. Visiant does a number of things that supports physicians and providers. My Portfolio products oversees a number of quality, safety and cost efficiency related solutions that help providers support their mission and provide the best care possible. And Hello. My name is Matthew Bates. I'm a managing director with Kauffman Hall, which is part of the vizient family, and I lead our work engaging with physician enterprises, medical groups, faculty practice plans around the country. A privilege to spend some time with you. Great. The report frames 2026, as a reset for US healthcare for physicians. What does that reset actually mean for how care is delivered over the next couple of years, and what changes are physicians likely to feel first? Yeah, so I think a couple examples of the reset. I mean first, I think we were moving from an AI hype cycle into AI as an addendum to our tools ambient listening, its ability to, for example, help generate notes, is becoming mainstream, right from a niche to really changing the way we practice, particularly in clinical, clinic, office settings. Another major reset

3:39
is, you know, the use of advanced practice providers. We have a physician shortage in this country. We're not going to get out of that shortage anytime soon, and a PPS are increasingly being leveraged to fill that gap and figure out how to do that effectively and efficiently. Provide high quality team care is part of the challenge.

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Yeah, I'd emphasize what most physicians will see on a day to day basis change is the use of AI tools to automate or reduce the burdens that they feel on a day to day basis. So ambient listening is the most common one reduces pajama time or evening documentation. That's that's well described. But there are also other tools around billing and coding and even access tools or things like medication refills. So I think they'll see substantial improvement in their lives moving forward. So that'll be part of it. I think physicians need to step out of, in some cases, their comfort zone and embrace those if they don't, they risk falling behind and,

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you know, losing what will be, I think, relevance and the ability to successfully continue to practice in the way they'd like to the report also finds that patients are sicker now than they were before the pandemic, yet things like mortality and hospital acquired infections are down.

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Can you talk about what's changing there, and care delivery to make that possible, and how fragile is that progress there at Vince, we have a tool.

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We call the clinical database, and 1500 hospitals send us all their inpatient discharges every month, and that we have seen a substantial and real reduction in quality and safety outcomes. I think that can range from things like patient falls to surgical infections, et cetera. So there's not one set of clinical or operational things that's changed. What I do think has changed are two things, first, and this is important. There's been a lot of attention paid to quality and safety. So for example, many of our hospital customers use our CDB outputs as their true north. They report to the board. I've been at multiple board meetings in the past 12 months explaining how they can use our tools and the processes that they're developing, in turn to support that quality journey. I think the second thing is, we're seeing policy incentives and penalties, and of course, that tends to drive behavior too. Combination of that, I think increased mission focus, as well as a combination of carrot and sticks has been what really has moved the needle in my experience. And I think the other factor we folks need to keep in mind is that the population is aging, and as patients age, you know, the 65 plus is the fastest growing part of the demographics. These are patients that are, you know, they're older. They often come with comorbidities. So while we're, I think you know, seeing that we can take care of these patients, many patients now right in lower acuity settings, those that are left in the hospitals are definitely getting sicker, and we see that in things like our case mix index is getting higher, meaning the patients that are left in the hospital right are sicker patients requiring more complex care. Yeah, and, like you just touched on there. I mean, there's this projection in the report that adults 65 that adults 65 and older are going to drive most of the growth in hospital use by 2035 and their size will increases there and discharges, emergency department visits, observation stays. How should physicians and practice leaders think about things like scheduling, coverage, service line strategy in light of that, you know, that growth, that influx,

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yeah. I mean, I think first of all,

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we need to be thinking about, you know, are we providing care to the right patients in the right setting,

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things that used to be hospital based right increasingly, we're doing an ambulatory surgery centers or in the office. We're finding ways to do home and virtual care that's great for those who though, who are older, as I said, they're coming with comorbidities. And I think one of the challenges we have as a healthcare system is we have a lot of specialists, but we we have to figure out what is the the quarterback model for multiple comorbidities. If this patient comes to us and they've got diabetes and a cardiac problem, and now they have cancer. We have to manage all of those in combination, right? We can't just treat them as three independent diseases, because the drugs and the treatments, right, actually bump up against each other, and that's that's going to require a new way of coordinating care and and we got to think about who's the quarterback of that patient, and that's something we we have to grow into. Frankly, I'll add that there's that old saw that strategy eats culture from breakfast. It's an MBA kind of thing. I think, in healthcare access eats whatever healthcare provider strategy you have. And so in order to meet that surge of the demographics of the silver generation coming, you have to think about how you're gonna get them into your facilities, how you're getting them through efficiently, and then how you're going to move them on, whether that's to home or other post acute settings of care. So coming hot out of the pandemic era, staffing was the number one thing that our customers told us. Now what we're hearing is that access is the number one thing that they're working on. And to solve that, the practical recommendations you have to embrace technology. You have to embrace new practice models, like use of a PPS and other what I'll call non traditional ways to boost your access capabilities. So

8:50
there's data from Kauffman hall that shows that total direct expense per employed provider, which includes physicians and a PPS, is up 6% between q3 2023, and q3, 2025, but margins there are still pretty thin. How is that actually showing up for physicians and for practices? Is it more visits per day, different call schedules, changes in pay plans or something else? Yeah, so Austin, you're referring to, I think this report, as well as we published quarterly the physician flash report and yeah, I mean, what we're seeing is costs are rising faster than revenue. That report also shows that physicians are and providers are working harder than they have. So they're they're more productive, they're seeing more patients, they're doing more stuff. But we're not getting paid

9:41
the what we're getting paid per unit of work, if you will, which we often think of as a work RBU, is not going up at the same rate at the costs are and so docs are working harder, but what they're making per unit of work is actually going down, effectively. The net, net of all that is that what it costs to support an employee.

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Physician, or the subsidy or investment, if you will, is is growing exponentially year over year.

10:09
The other piece of this is that we have a shortage of physicians in the country. So there are many specialties and many geographies right where we just simply can't find docs with the right specialty to meet the needs of the patients. So this ties a little bit to what Shannon said about access challenges, but it also is driving costs. Right? If you can't find anesthesiologists who want to work in your market, you're going to have to pay more right to be able to attract and retain that talent.

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So a PPS now make up 40% of employed providers. What is a healthy, well run team of physicians and a PPS look like in practice? And what are some common ways that team structure goes wrong for patients and for clinicians? Yeah, it's pretty analogous to the you know, you want to decant your most your some of your inpatient surgical volume or procedural volume off to lower acuity settings of care. That's the same gist. Of course, with this, you want to decant less complex patient care. You want your surgeons operating, and you want you know your your medical experts working the most complex cases. I don't think there's a magic formula, but what we see is practices that have a blend of doing that see the most productivity out of both their APs and their physicians. One of the interesting side notes that we hear from from our colleagues in the field, is that

11:27
it's nice to have docs practice at top of license. Of course, that's what you want. That's what the physician wants, generally, and what the organization wants, but it does place an interesting increased cognitive load on them if they're always doing seeing the most complex patients with the most complex care that can be draining in an interesting way. And so you do have to be thoughtful about that. Surgeons always want to operate right like he or she, they always want to be in the or those that take care of patients on a more medical basis. It's an interesting thing. So you have to be thoughtful there. Additionally, you have to be careful that your APs are extender language

12:00
is no longer appropriate, but you want to make sure that they're they're practicing at appropriate levels of complexity, so that you don't introduce unfortunate, inadvertent risks to them or to your organization as well. The only thing I'd add, I think, I think Sean said that very well, is if you look forward over the next five to 10 years, a PPS, particularly nurse practitioners, are entering the workforce at about double the rate of doctors. So not only is it 40% today, it'll be probably half the workforce within the next decade. And so I think, you know, figuring out effective, efficient models is critical. Like, it's not a nice to do, it's not a if you get there, it's a must do, and I think the organizations that are getting there more quickly and figuring it out or having more success of creating efficient, effective teams, they're going to come out ahead of those right who are struggling.

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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 kreynolds, 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.

13:52
So cost pressures around around labor, drugs, devices and supplies are described as evolving, not easing,

13:59
for small practices that don't have, you know, big corporate backers behind them. What are one or two concrete concrete moves from this analysis that can realistically be implemented does stay solvent without simply asking clinicians to, you know, work longer or work faster. At visiank, we spent a lot of time thinking about the supply piece of the equation, and that's obviously everything from band aids to drugs to everything that a practice in an ambulatory setting, an ambulatory surgery center or clinic needs to support their operation. So there are software vision offers, of course, software called

14:32
that targets a smaller Ambulatory Practice, and it allows you to go save money on kind of the software it takes to order and do procurement as well as then you get preferential contracting, so you get cheaper pricing on stuff. Another thing that vizient Does that can help support smaller ambulatory practices is we form coalitions, and so you can come together with you can group yourselves with other coalition and similarly, you can get preferential pricing and other benefits like networking and expertise as part of that that can help support your mission.

15:01
Uh, the report also notes fewer big hospital mergers and more targeted partnerships, things like surgery centers, urgent care, behavioral health bills on the ground. How does that change? Where patients are actually getting sent, and what should physicians pay attention to before joining one of these arrangements? Yeah, I think it's a great, great question.

15:21
You know, at the end of the day, I think the goal is still the same right which is to take great care of patients

15:28
in the right setting. I do think

15:31
we went through kind of this divestiture period where, you know, Stark and anti kickback really forced physicians, you know, to move into an employment role and out of an ownership role as part of the health system. So what, what part of what's going on right now is, is physicians have opportunities to get back into being owners in the business models, and largely that's driven through ownership of these ancillaries, like you mentioned, you know, surgery centers, urgent care and other components. But I also think you know, who's in charge, who's calling the shots? What's the governance structure? You know,

16:06
if you sell your practice or go into partnership with a payer, you got to make sure that you have alignment and make sure that you feel good about you're going to still be able to make the clinical decisions you feel are appropriate. Or are you ceding that power and control, potentially, to a corporate entity who might be, you know, physically located long distance away from where you actually on the ground provide care.

16:28
So I guess we'll go into the, you know, the topical one here, AI, the AI question that comes up in every discussion. But you know, AI is projected to grow from a $20 billion

16:39
I guess, industry right now to roughly $100 billion market in healthcare by 2030 but you emphasized that value comes from workflow redesign, not just tech deployment. Where are you actually seeing artificial intelligence reduce waste or give physicians meaningful time back today? And where is the hype kind of still ahead of the reality where it really is? Yeah, so the ambient listening is the obvious killer app in this space, where we're seeing substantive improvements and physician time. And

17:09
the other areas where we're seeing are in the Revenue Cycle space, so billing and pre authorization, those kinds of tasks, we've seen substantive improvement, and that accrues to both the physician, he or she has to spend less time doing that stuff, and it also results in better economic outcomes for either their practice or the large organization they're part of. From a clinical care perspective, I'm really excited about what I'm seeing from solutions that, like open evidence, that provide clinical support in ways that really meets the docs where they are in their workflows. And so those kinds of solutions, like increased access to, you know, to the research and best practices from those types of solutions, as well as things like chart summarization and automated responses to

17:54
to patient messages, can be powerful ways that they actually improve their day to day lives. Flip side of that, of course, is he has to be responsible. There's always got to be human in the loop. There is lots of talk of autonomous solutions in these spaces, and it'll be really interesting to see how that plays out. There's a part of me that wonders if it's going to be the providers and the physicians with their AI doing battle with the payers and the regulatory AI, and who's going to win for now, it's still healthcare, and my hope, and everyone I talk to still wants to use those tools, but wants to make sure there's a human at the end of the day making all the clinical decisions

18:27
for physicians who run a practice. The report paints a picture of higher costs, older patients, tighter margins. Plus there's, you know, regulatory policy shifts from site neutral payments, things like the one big, beautiful Bill Act, Medicare Advantage changes if you're advising a small physician group today, what are the top two or three metrics or signals from this report that they should be looking at and they should be watching to know if they're they're on solid ground, or if they're kind of drifting more into risk? Yeah, it's a great question. I mean, I think great patient care still matters. In fact, it probably matters more than ever, and that includes great patient experience. I think sometimes

19:06
folks forget that that great patient care is as much in the eye of the patient as it is in the the actual clinical measurable side of quality, right? So we got to, we got to blend those. And then I think patient access Shannon alluded to this, but what we see in the data is very clear, if a patient has a new problem, whoever gets them in in the next five days probably is going to get that care. And even if you have an established relationship with a patient, when they have a new problem, if you can't get them in the door, they're going to go somewhere else. And that's particularly true of commercial insured patients, which are so critical right to financial sustainability, the Medicaid patient right will go wherever they can find somebody that will let them in the door. And frankly, you know we hope and can you know that the financials will work, that docs can continue to financially be viable treating Medicaid patients.

20:00
Think that's important, but those commercially insured patients, right drive, particularly the independent practice, are absolutely essential, and so we've got to provide the access for those patients if we want to recruit, retain and take care of them.

20:15
So if you had to give physicians one practical takeaway from the report, what's the single most important thing that they can do inside their own practice this year to stay viable, as as this reset plays out for molds to embrace digital solutions that make sense. AI is obviously the budweis buzzword of the moment. But if you're not looking at some type of solution to help you, you know document better and to do your billing better, you're already behind, and you should be thinking about solutions that can help you do that, because that's going to be essential to being viable as we move forward. I think it's right. And I'll just combine again the access card, and I can't repeat it enough access, access, and sometimes we we need to remember that access to a patient means I got to talk to somebody that knew what I my problem was, and they started the process. So great example here would be,

21:09
maybe I'm a potential surgical candidate for an orthopedic procedure, but I actually need an X ray and I need some other diagnostic tests first. So from a patient perspective, access is when those tests start getting ordered, not necessarily when the surgical decision gets made. I think sometimes we we back up accessing well, we can't get you in with a surgeon for three weeks, but from the patient's perspective, getting in, perhaps with an AP, getting those diagnostics ordered, getting the process going, that matters. Think about in cancer, might take a month to get to the specialist, but if you can get all the diagnostics done first, from your perspective as a patient, access is underway, that will make the difference Absolutely. So those are all the questions that I have prepared. Is there anything from the report that you think we might have glossed over or missed, or anything else that you want to

22:00
share? One thing, Austin, I I always say that physicians like myself, I mean, physicians go to med school to do good, not do paperwork, and I'm really excited about the potential of these AI tools to return the joy to medicine. And that's a noble goal in and of itself. And I think that's great. But that also translates into, I think, economic good economic things too. So a happier Doc is going to be more productive, they're going to provide better care, and they might extend their career. So I really encourage these physicians and organizations that employ them to look at that and to think not just about the 12 month P and L, but also about the longer term joys and rewards of health care.

22:40
Perfect. All right. Shannon Sims, Matthew base, thank you both so much again for your time today. Pleasure to be here. Thanks. Thank you.

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Once again, that was Dr Shannon Sims visitings chief product officer and Matthew base, Managing Director at the Kauffman Hall. On behalf of the whole medical economics and physicians practice teams, I 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 practice Academy's new practice management track on Thursday, March 19, featuring practical, actionable education for physicians and practice administrators. You can register today by clicking the link in the show notes or by going to registration.physicianspractice.com

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as always, 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 your email six days of the week, subscribe to our newsletters at medical economics.com and physicianspractice.com off the chart, a business of medicine podcast is executive produced by Chris mazzolini and Keith Reynolds and produced by Austin Latrell. Medical economics and physicians practice are both members of the MGH Life Sciences family. Thank you. You