Here are six financial indicators that physicians and practice leaders/administrators should review and discuss each month.
Monitoring standard revenue cycle management metrics is a smart way to focus on the financial indicators that matter most. Consistent review is essential to identifying collection slow downs, productivity fall offs, and potential risk issues before they become acute.
Here are six financial indicators that physicians and practice leaders/administrators should review and discuss each month. Report them in a dashboard, using an Excel spreadsheet or a business intelligence platform. Most practice management systems can generate charge, payment, adjustment, and receivables data by physician, payer, location, and high-volume CPT codes.
We recommend that the management metrics be calculated for each of these categories. To compare yourself to industry norms, include MGMA's benchmark data for your specialty in your dashboard.
The gross collection percentage is a comparison of the total payments received during the period, net of refunds, to the total amount of charges billed. Due to fee schedule, subspecialty focus, and payer mix variations, it is not possible to compare this figure to other practices or even between physicians within a practice, because service differences exist. This metric is useful for tracking a physician, sub-specialty, or site over time to assess whether relative collections are improving or not.
Formula: [Total Payments - Refunds] / Total Charges
The physician shortage didn't become an issue solely because fewer physicians are available - it's also rooted in where they go. Rural communities are particularly underserved in terms of medical care because many physicians choose to practice in urban environments.
One way to encourage physicians to join rural facilities is by providing financial incentives such as student loan payback. Physician debt is a serious issue, and reimbursement programs alleviate the physician shortage in rural areas while helping new doctors pay down their loans.
It's difficult to predict when physicians will retire, quit the profession, or decide to move. Staffing models such as locum tenens allow a facility to fill unexpected gaps in coverage with qualified physicians.
If a veteran doctor wants to take a vacation or work fewer hours, a short-term appointment can provide her with that freedom. Many physicians who have struggled with burnout opt for locum tenens work because they enjoy the cycle; they work hard for a set amount of time, and then they can recover with a break before they begin a new assignment.
Cheyenne Brinson, MBA, CPA, is a Chicago-based, senior consultant with KarenZupko & Associates Inc., a consulting and education firm that has been helping physicians increase revenue, optimize efficiency, reduce risk and improve the patient experience for more than 30 years.
