Physicians weighing where to open or expand a practice may look beyond reimbursement and patient volume. State-to-state differences in practice expenses, price levels, and some cost-related policies can shape how expensive it is to operate an office.

1. Arkansas — posted a 2026 Medicare practice expense geographic practice cost index (GPCI) of 0.859, the lowest among states treated by Centers for Medicare & Medicaid Services (CMS) as a single statewide locality. The Bureau of Economic Analysis (BEA) reported a 2024 regional price parity of 86.9, also the lowest among these states. Its 2026 malpractice GPCI was 0.515.

2. Mississippi — had a 2026 practice expense GPCI of 0.861. The BEA reported a 2024 regional price parity of 87.0, the second-lowest among the states. Its 2026 malpractice GPCI was 0.739.

3. Alabama — recorded a practice expense GPCI of 0.875 and a 2024 regional price parity of 88.8. CMS listed its 2026 malpractice GPCI at 0.566.

4. Kentucky — had a practice expense GPCI of 0.889. BEA reported a 2024 regional price parity of 90.2, while CMS listed a 2026 malpractice GPCI of 0.915.

5. Oklahoma — posted a 2026 practice expense GPCI of 0.893. BEA reported a 2024 regional price parity of 87.8, tying with Iowa among the lowest states. Its 2026 malpractice GPCI was 0.777, lower than in Kentucky.

6. Kansas — had a practice expense GPCI of 0.904 and a 2024 regional price parity of 90.1. CMS listed its 2026 malpractice GPCI at 0.504.

7. Tennessee — recorded a 2026 practice expense GPCI of 0.909. BEA reported a 2024 regional price parity of 91.9. Tennessee’s Hall income tax was repealed for tax periods beginning on January 1, 2021, or later. Its 2026 malpractice GPCI was 0.537.

8. Ohio — had a practice expense GPCI of 0.913 and a 2024 regional price parity of 92.8. CMS listed its 2026 malpractice GPCI of 1.008.

9. Iowa — posted a 2026 practice expense GPCI of 0.915. BEA reported a 2024 regional price parity of 87.8, tying with Oklahoma among the lowest-priced states. Its 2026 malpractice GPCI was the lowest, sitting at 0.397.

10. New Mexico — had a 2026 practice expense GPCI of 0.917. BEA reported a 2024 regional price parity of 92.2, and CMS listed a 2026 malpractice GPCI of 1.201.

Honorable Mentions

Idaho — narrowly missed the top 10 with a 2026 practice expense GPCI of 0.920. BEA reported a 2024 regional price parity of 95.5. Its 2026 malpractice GPCI was 0.473.

Nebraska — was another near miss, with a 2026 practice expense GPCI of 0.923. CMS listed its 2026 malpractice GPCI at 0.378, just below that of Iowa.

Sources: Bureau of Economic Analysis, FRED, Tennessee Department of Revenue, Centers for Medicare & Medicaid Services