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"How
To Increase Income In Medical Practices"
Very
often I am asked how to get more patients
for medical practices. Unless a physician
is starting out or starting anew, the
real question is how to increase practice
income. There are several ways in which
that can be accomplished. Below are three
examples among many.
The
first example is to assess how time is
spent serving patients. Not only physician
time and physician extender time, but
also time spent on administrative tasks.
Practices that invest in software simply
for scheduling and billing miss golden
opportunities to reduce staff costs and
overhead by not including electronic medical
records. One effort should create multiple
results. So data imputed into the scheduling
record should also find its way to the
billing record and the electronic medical
record, eliminating redundant effort.
Electronic
records also produce reports often required
by referring physicians, attorneys, MCOs
and medical reviews. Electronic records
greatly reduce the cost to transcribe,
when designed to easily capture data by
a point and click method. The average
staff to physician ratio is reduced 1.5
to 2.5 staff members. The average cost
of transcription is reduced a minimum
of two thirds. The cost of copy paper,
ink cartridges, faxes and postage are
also greatly reduced. Additionally reductions
are seen in errors, lost filings and storage
costs, causing lost time, repeat efforts
and lost funds.
Response
time to labs and x-rays are increased
and the data collected becomes a historical
understanding of costs and patient care
needs; allowing the practice to better
plan their services and overall costs.
If you take the concept one step further,
the next time a practice needs a copier,
they may consider a digital copier that
is also a scanner, printer, copier and
fax machine connected to practice computers,
eliminating further redundant activities
and costs. The payback is exponential.
The
second way in which income can be found
is via the HIPAA regulations that all
practices are subject to by federal law.
HIPAA has guidelines that require the
practice to follow the paper trail to
determine where private information may
be compromised and where incorrect coding
may be occurring. First incorrect coding
causes delays in payment and can subject
a practice to audit. Second following
the paper trail, in a practice, identifies
the impediments to growth and lost funds.
In
addition, the guidelines for fraud and
abuse assessment are identical to HIPAA
but for different information. When combining
both to evaluate the flow of business
you then can identify cash flow opportunities
the practice didn't know it had.
A
third way in which practices may increase
income is to work with financial institutions
that can convert outstanding receivables
and credit quickly for minimal charges.
Factoring generally covers 3-10% of outstanding
funds, which are then converted to immediate
cash to the practice rather than waiting,
up to 180 days. Some practices find up
to 25% of their billings are held back
for review. Workers Compensation claims
subject to arbitration can take up to
two years to resolve. Factoring eliminates
the wait providing practices with better
cash flow.
Some
credit card companies and banks offer
credit card and electronic check services
that transfers funds immediately upon
submission, with little to no charges.
It results in cash flow that doesn't have
to be chased, monitored, or repeatedly
requested, saving time, follow up billing,
postage, and reduces patient avoidance
to pay co-pays, deductibles and outstanding
bills. Cash in hand is worth more than
outstanding claims and bills waiting to
be paid.
Practitioner
hesitation to implement cost saving principals
is based more on being unsure of what
they should buy that will provide the
kind of results they are looking for.
In the three examples provided above,
it is best to outsource that to a business
expert with a health care management background
rather than lose precious time and resources
trying to make such decisions alone. The
investment returns are greater than the
costs short and long term.
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