Your practice's revenue cycle--collecting the full amounts owed in a timely manner--can mean the difference between keeping the doors open and shuttering them for good, a predicament Nicholas Greco, former practice manager for a solo, psychiatric practice based in Gurnee, Illinois, knows all too well.
"The practice was profitable at one point," Greco told Physicians Practice. "Unfortunately the insurance companies have financially shifted the burden onto patients. They are paying less money to us and putting more of the onus on the patients. And the patients can't pay or don't want to pay [us]." As a result, the practice owner decided to close his business at the end of 2015 and seek employed status, according to the article.
To catch business-threatening problems in your practice before it's too late, consider the following advice:
- Conduct a monthly financial meeting. Smaller practices might not have a lot of resources to handle financial reporting, but the alternative to bringing physicians, administrators and managers to the table for a monthly meeting to go over numbers can be dire. To make the most of physician leaders' time, administrators should set a clear agenda for items to review, such as the profit and loss statement and various internal and external benchmarks, Reed Tinsley, a Houston-based CPA and practice management consultant, told the publication.
- Prioritize practice metrics. There are almost countless ways practices can measure their own performance over time and compare it to others. The metrics that deserve the most attention depend on the practice. A psychiatric practice such as Greco's, for example, likely receives most of its revenue through patient collections and will want to watch those numbers closely. When it comes to tracking third-party payments, practices need to ensure they're receiving the right contracted amounts. One strategy is to track reimbursement for your practice's top procedures and CPT codes by payer, suggested Ken Hertz, principal with the Medical Group Management Association Healthcare Consulting Group.
To learn more:
- read the article