Build Medical Practice Profitability
Unfortunately, not only do physicians have to cope with reduced reimbursement from Medicare and other third party payers in a time of accelerating expenses, but the economy is also having a significant impact on some medical practices. Some patients are losing jobs and not quickly finding replacement employment. This causes them to curtail elective expenditures, and health care is often viewed as elective, especially when insurance benefits expire.
Even so, there are medical practices that are not only holding their own but actually thriving and achieving new records of productivity and profitability. Listed here are a few of the techniques they employ that might help you too:
1. Increase Efficiency
Inefficient practices on the part of both the physician and staff waste time and money. Seeing just one more new patient per day can increase net profits by $30,000 or more per physician per year. Review your systems and behaviors and eliminate or streamline inefficiencies.
2. Minimize Waste
Audit your practice for wasteful procedures. Review your inventory control system for currency and put one person in charge. Over ordering wastes cash and storage space and under ordering wastes labor. Negotiate for better supply prices. Consider looking at joining or forming a group purchasing organization.
3. Learn to Manage Your Managed Care
Review rates, compare rates to costs, and determine weed out unprofitable relationships.
4. Eliminate Staff Overtime
If regular overtime occurs, you are probably understaffed and should hire extra part time staff at reduced rates. If overtime at "time and a half pay" does occur limit it to over 40 hours per week, not over 8 hours day to day. If you always run late, maybe you can keep just one person late, not the whole staff.
5. Train Medical Practice Staff
Rarely do I find staff that doesn't appreciate training to increase their abilities, and rarely does training not pay. Have staff report back to the group on what they learned and how it can help the practice. Listen to their suggestions. Hold regular in-service training on your specialty.
6. Constantly Monitor Practice Finances
On a monthly basis review overhead statistics, collection statistics/ratios, receivable aging, coding practices, and revenue cycle benchmarks. Again, this must be done monthly!
7. Increase Marketing
Every practice should know how many new patients per month it takes to keep busy and take action to insure that flow. Marketing can be as subtle or bold as you dare, as long as it produces adequate results. If you are not meeting your new patient count goals, get help. There are hundreds of tasteful ways to encourage referrals or attract patients directly.
8. Audit Your Charts for Oversights
In many specialties I find that patients "slip through the cracks" on follow up or even surgeries due to missed appointments or unscheduled recalls. Review 10 charts a day for compliance and call patients that need to be seen.
9. Look At Your Own Activity
We all do things to "sabotage" our own success at times, like not staying late to return calls, maintaining chronic tardiness, etc. Ask your staff what you can do to make their jobs easier or to make patient visits more pleasant. Listen to their input and take action. Call a consultant for a practice survey if you need help.
Additional Resources on Medical Practice Profitability
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