Medical group practices faced significant pressure from rising expenses in 2024 and 2025, with more than nine practices in 10 reporting higher operating costs each of those years, with labor costs as a dominant factor.  

Finding ways to grow reimbursement are crucial and you typically can’t “procure your way out” of expense inflation without addressing productivity, but for this article, we are focused directly on where can practice administrators save a dollar — and then thousands more? 

A Jan. 27, 2026, MGMA Stat poll asked practice leaders to give us a sense of the biggest cost-cutting move they will make in 2026. Automation (36%) and process fixes (23%) made up more than half the responses, followed using a hiring freeze or cuts (18%), outsourcing (14%), and finding new vendors (9%). The poll had 226 applicable responses. 

These results point to a reality for practice leaders whereby more than eight in 10 are looking for proactive solutions to address financial strain beyond trying to cut back on staffing. 

What to focus on in 2026 

The best cost-cutting move depends on where your cost pressure actually lives, and whether you’re an independent practice (often leaner, less scale) versus a system-owned group (typically with more scale and complexity). Here’s what we’re seeing: 

Automation 

Best for: Practices where labor is the top cost pressure (which is most) and where you can remove manual touches in high-volume workflows. Respondents to this week’s poll overwhelmingly plan to automate revenue cycle management (eligibility checks, claim status, denials workflows, prior auth workflows), clinical documentation, scheduling, contact center (call routing, callbacks, self-service, message categorization)  and front-desk tasks, coding, and related AI‑driven workflows as primary cost‑cutting initiatives in 2026. 

What to watch out for: If you add tech but don’t remove steps, you add cost. 

How to measure cost savings (not just “adoption”) 

• Minutes of staff time per scheduled visit (from check-in to close-out) 
• Calls per appointment / calls per provider session 
• Touches per claim and touches per denial 

Outsourcing 

Best for: Smaller practices lacking scale, or larger groups trying to solve “hard” back-office bottlenecks quickly (e.g., RCM, contact center, recruiting).  

Respondents to this week’s poll said they are most focused on outsourcing call centers, RCM, billing, authorizations/prior authorizations, scheduling, coding, medical records, and various virtual clinical support functions. 

What to watch out for: Outsourcing can fail when governance is weak. Keep the work you must own (e.g., clinical nuance in scheduling protocols, performance monitoring). 

New vendors 

Best for: Almost everyone — and renegotiation/vendor change is often the fastest lever for cost containment. 

Respondents this week pointed to seeking new vendors for EHR systems, IT and technology services, medical and office supplies, revenue cycle and insurance support, and drug procurement. This may include GPO optimization; contract rebids and licensing audits (e.g., EHR add-ons, cybersecurity tools, telecom, copiers, shredding, waste, lab vendors, medical supplies); and/or supplier diversification with renewed inventory discipline (especially for practices sensitive to drug/supply shortages and price spikes). 

What to watch out for: Switching vendors creates transition cost. Your “savings plan” should account for implementation time, training time, and the risk of workflow disruption. 

Hiring freeze/cuts 

Best for: Practices in immediate distress, but it should be the most targeted option, because blunt cuts can create access problems, burnout, turnover, and downstream inefficiency. Respondents to this week’s poll taking this route noted their freezes and cuts were most concentrated in administrative, nonclinical and clinical support roles. 

If choosing this route in 2026, be sure to consider: 

• Position control and vacancy review (every replacement requires an operational justification), rather than surprise layoffs. 
• Aligning schedules to demand (reduce overstaffing in low-demand periods, reduce overtime in high-demand periods) instead of reducing headcount indiscriminately. 
• Protecting revenue-adjacent administrative roles that prevent rework (e.g., prior auth, denials workflow) unless you’re simultaneously automating/outsourcing them. 

What to watch for: If you can’t name the workflow improvement that will replace the labor you’re cutting, you’re probably just shifting cost into overtime, turnover, and backlogs. 

Process fixes 

Best for: Everyone, and especially practices that don’t have capital budget headroom. Process fixes are the cheapest way to reduce “waste work.” Respondents to this poll said they plan to pursue process fixes across scheduling, billing, revenue cycle, prior authorizations, coding accuracy, intake/referrals, pre‑service collections, and operational streamlining — including retiring unprofitable programs — to reduce costs. 

Where are you likely to find these opportunities for fixes? 

• Patient access and no-show workflow redesign (e.g., better reminders, easier rescheduling, waitlist fills, template discipline). 
• Demand-based staffing: align front desk, MA/nurse staffing, and phone coverage to predictable peaks. 
• Standard work and simplification in RCM and prior auth workflows before you buy new tech. 
• Space and site rationalization (consolidate underused space; standardize rooming and turnover processes). 

In many respects, process fixes are the glue that makes the other four cost-cutting options work: Automation fails without standardized workflows. Outsourcing fails without clean handoffs and rules. Vendor changes fail without adoption discipline. Hiring freezes fail without productivity redesign. 

Learn more 

For peer-vetted insights and best practices on expense reduction or finding operational fixes or solution partners for automation, consider joining us at the 2026 MGMA Financial Conference, March 1-3 in Phoenix, Arizona, or the 2026 MGMA Operations Conference, April 12-14 in Charlotte, North Carolina. 

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