As healthcare reform gains momentum and more uninsured consumers obtain coverage, the role of the physician extender or non-physician provider (NPP) will continue to grow to help meet surging patient demand. 

For physician practices, hiring NPPs can be a smart business move that reduces pressure on the practice, increases physician income and enhances patient satisfaction. The key to successfully integrating NPPs, experts say, is to develop a well-conceived plan that includes rigorous cost-benefit analysis and careful thought about the extenders' role and scope of practice.

A Helping Hand

Traditionally, NPPs have served as frontline caregivers working under the supervision of a physician in underserved or rural areas. But with projected shortages by 2020 of more than 100,000 specialists of all types and over 40,000 primary care doctors alone, the use of NPPs has become increasingly common across the care spectrum.1

NPPs typically have a master's degree and can include nurse practitioners and physicians assistants with specialty-specific training. They work in physician offices, emergency departments, hospitals, inpatient and outpatient surgical facilities and a variety of urgent care centers and retail clinics.2 Depending on state regulations, NPPs are qualified to handle multiple routine clinical responsibilities, including:3

  • Obtaining patient histories and performing physical exams
  • Developing, implementing and monitoring treatment plans
  • Charting pertinent clinical findings
  • Providing patient counseling, education and coordination of care

For most practices, hiring NPPs can boost productivity by allowing physicians to concentrate on more complex cases. Relying on NPPs consequently can help reduce the need for hiring additional physicians, while improving the overall staffing equation.

"Including nurse practitioners and physician assistants on the clinical staff can enhance scheduling flexibility and make it easier to offer part-time jobs without compromising quality of care," wrote Susan O'Hare, a nurse practitioner and consulting executive in 2010.4

Boosting Income

Significantly, practices that utilize NPPs typically perform better financially and generate higher physician incomes than those that do not, according to a 2014 report by the Medical Group Management Association. The DataDive 2013: Physician Compensation and Production Module survey showed that the pattern of higher revenues and stronger compensation held true to a greater or lesser extent across virtually all single specialty practices, including family medicine.5

The increases reflect in part the differential between what NPPs earn and what they can produce. According to a 2011 report by the American Academy of Orthopedic Surgeons, the majority of nurse practitioners and physician assistants of all types earn between $85,000 and $95,000 annually, with variations due to experience, practice location and specialty. Physician group collections for nurse practitioners, meanwhile, average $147,000, while collections for primary care physician assistants average $175,000.6

Given the favorable economics, certified healthcare business consultant H. Christopher Zaenger states that hiring NPPs may be "the best way to expand your practice, increase the amount of net income per square foot of space, and provide you with a lifestyle that creates more freedom of choice."7

"Remember, the new competitor in healthcare delivery may not be your local hospital," Zaenger wrote in Medical Economics. "It may be the CVS or Walgreens on the corner or an entrepreneur building a high-access clinic down the street in states that allow them."

Developing a Plan

Physician groups that are thinking about bringing on an NPP should weigh several key considerations, according to a recent article published on Physicians Practice. These considerations include: 8

  • The purpose of the new NPP – Groups should clearly define their needs and objectives and then determine how an NPP can help meet them, the article states. For example, is the goal to relieve physicians from the demands of a growing patient population? Or is the practice planning to extend its service lines to attract a new type of patient?
  • The scope of practice of the new provider – Groups should consult with state licensure authorities to determine what an NPP is allowed to diagnose or treat, what level of physician supervision is required and which medications an NPP can prescribe.
  • The nature of the patient population – Analyze case mix to ensure that the volume of clinically common patient appointments can sustain the NPP role.
  • The onboarding process – Because patient acceptance of the NPP is essential, it is important to think about how physicians can introduce the new team member in order to address any patient uncertainties or concerns. Physician, too, must accept the NPP's role. The Physician Practice article notes that if other physicians see the NPP as a competitor, the entire exercise will fail.
  • Cost versus benefit – The anticipated salary of the NPP must be weighed against the expected additional revenue they can produce. It is also important to clearly understand payer rules regarding how NPP services can be billed.

"Hiring a non-physician provider can be a good business decision for practices – but only if they have a plan," the Physician Practice article concludes. "As demand for these positions grows, practices need to ensure that their new hire's role is clearly defined and a good fit for the practice. Otherwise, the non-physician provider may soon leave for a better opportunity. The goal should be long-term relationships that both you and your patients come to count on." 9

1 Susan O'Hare, "Mid-Level Providers in a Changing Healthcare Workforce," Becker's Hospital Review, Aug. 17, 2010, http://www.beckershospitalreview.com/compensation-issues/mid-level-providers-in-a-changing-healthcare-workforce.html
2 "NPP utilization in the future of US healthcare: An MGMA Research & Analysis Report," the Medical Group Management Association, March 2014,
3 Ibid.
4 Susan O'Hare, "Mid-Level Providers in a Changing Healthcare Workforce," Becker's Hospital Review, Aug. 17, 2010, http://www.beckershospitalreview.com/compensation-issues/mid-level-providers-in-a-changing-healthcare-workforce.html
5 "NPP utilization in the future of US healthcare: An MGMA Research & Analysis Report," the Medical Group Management Association, March 2014, https://www.mgma.com/Libraries/Assets/Practice%20Resources/NPPsFutureHealthcare-final.pdf
6 Thomas Grogan and Adam Soyer, "Enhancing Your Practice's Revenue: Pearls and Pitfalls, A Primer for Orthopaedic Surgeons," American Academy of Orthopaedic Surgeons, February 2011, http://www3.aaos.org/member/prac_manag/enhancing_revenue_primer.pdf
7 H. Christopher Zaenger, "How hiring a physician assistant or nurse practitioner could ease a physician's workload, increase take-home pay, and more," Medical Economics, Nov. 10, 2013, http://medicaleconomics.modernmedicine.com/medical-economics/news/how-hiring-physician-assistant-or-nurse-practitioner-could-ease-physician-s-w?page=full
8 David Doyle, "Hiring a Nurse Practitioner or Physician Assistant: 5 Considerations," Physicians Practice, May 10, 2014, http://www.physicianspractice.com/blog/hiring-a-nurse-practitioner-or-physician-assistant-five-considerations
9 Ibid.

McKesson

About the author

McKesson Business Performance Services offers services and consulting to help hospitals, health systems, and physician practices improve business performance, boost margins and transition successfully to value-based care.