Large hospitals and health systems have the ability to spend millions of dollars each year gathering, analyzing, and organizing data to reduce financial waste and increase profits. They have access to sophisticated analytical technologies that have been traditionally unavailable to small, independent practices. Private practices have been relegated to using less-expensive, less-effective reporting platforms that require hours of manual analysis and compilation.
Without a clear financial view, physicians lack the ability to make informed, real-time decisions that can benefit their practices. This highlights how access to comprehensive financial reporting can unlock hidden revenue, eliminate billing leaks, and inform nearly every business decision for an independent practice.
Defining the problem
Lack of expertise
Physicians undoubtedly know what's best for their patients; however, in medical school they don't learn what is best for their practice's finances. In fact, many doctors admit they don't measure key metrics critical to revenue cycle management. For example, in a recent survey from AdvancedMD, 50 percent of physicians reported they do not use benchmarking to compare their financial performance to that of their peers. Then how do they make decisions without data? That's right: many simply go by the "gut" instinct.
Additionally, the level of expertise and knowledge required to compile financial snapshots often surpasses that of the average front office or billing staff. The picture these manual reports paint can be incomplete at best, inaccurate at worst.
Unlike a large hospital, the small medical office does not have the luxury of a team of database experts and financial analysts trained to drill away at complicated data reports. Rather, in an environment where everyone is required to wear many hats, the heavy burden of financial reporting often falls to the office managers or the physicians themselves. Even if a practice does have a financial reporting mechanism in place, hours of staff and physician time are spent each month to compile patient and financial data manually. Untimely reports cannot inform a practice's long-term financial success.
No access to sophisticated technology
It is not that private practices lack data; they have droves of it. But rarely does a private practice have the level of sophistication or the technological tools to extract and organize existing data in a meaningful way, and do so quickly.