During the many years I worked in private medical practices, the summer months signaled a much needed slow-down in patient appointments. For the first few weeks, it was a welcome change of pace allowing everyone to enjoy the usually rare luxury of being able to take our time to complete our daily tasks.
Admittedly though, things seemed to become too quiet and frankly a little boring. A seasonal slow-down is the perfect time to take full advantage of your open schedule and perform a practice check-up.
Your check-up could be reviewing and updating Medicare and commercial payer coverage guidelines or authorization policies and procedures. You can cull charts of inactive or deceased patients. Update your documents on office workflow, and job descriptions. Even get caught up on reading payer newsletters that have been piling up in your inbox.
All of these are great uses for your time, but I would suggest a “financial” check-up of some common indicators of the health of your medical practice. I like to refer to them as the Vital Signs: pulse, blood pressure and temperature.
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The Pulse: How many new patients are you seeing each month and who is referring them to you?
I suggest running your new patient report for at least one year, broken down by month. By analyzing the trends, you will be able to determine if your practice is growing, stagnating, or hopefully not, declining. You can utilize this data to make necessary staffing and other infrastructure changes as well as address any issues that are causing the less than favorable results. One reason for declining new patient numbers could be explained by decreased referrals.
A report that breaks down new patient referral sources is a valuable tool in this process. If you identify trends that show a reduction in referrals from particular sources, seize this as an opportunity to reach out to them personally and discuss how you can earn back their valuable referral. You may also be pleasantly surprised by an increase from colleagues. This definitely warrants at minimum a contact so say thanks, maybe even a lunch or dinner get together. Fostering relationships with the other physicians in your community is a highly effective tool in practice growth.
The Blood Pressure: Are the numbers of services you bill increasing, decreasing, or staying the same and are you being reimbursed according to your contracted rates?
Again I suggest a yearly report that allows you to review month-to-month statistics. This should provide enough data to recognize anomalies in your billing patterns. Sharp declines in a certain procedure may indicate forgotten or missed coding opportunities and therefore missed revenue. It may also identify items that are billed so often as to have the potential of raising a red flag with a payer. Review the documentation of those items to ensure their medical necessity and adjust medical billing procedures accordingly.
Once you have analyzed the numbers of procedures, you should spend time comparing the reimbursement rate with the contracted rates. This type of analysis is invaluable to any medical practice. If reports indicate payments that are below the payers contracted fees, this should prompt an immediate call to the Provider Relations Department. If you discover payments above the contracted fees, research has to be done on the accuracy of the fee schedule you are using, for instance, perhaps the payer has updated its schedule and you have not.
The Temperature: What is the aging breakdown of your accounts receivable and what are the procedures to ensure quick collection of monies due?
We all know that looking at accounts receivable data and working those balances must be done on a regular basis, ideally once a month. We also know that no matter how hard we try sometimes we fall behind on follow up of “problem” cases. You will likely have your basic Accounts Receivable report with its typical monies due in aging “buckets”: less than 30 days, 31-60 days, 61-90 days, 91-120 days, 121-150 days, and over 151 days.
Since the older the receivables get, the more difficult it is to collect from the payer, there may be claims in those oldest buckets that need to be deemed “uncollectable”. You will have the time to delve into the details of those services and make the tough call to just let it go. Or you may find ones that just need to be put on a follow up call list to the payer. Either way, it’s time to get caught up on these old receivables.
Once you have spent time cleaning up those really old items, it is a good idea to try to identify issues that may help you to prevent items from getting into those categories. If you analyze receivables in the 31-60 days category by payer, it may indicate most of the money is based on secondary payer balances. Having a process in place with your medical billing staff to identify slow secondary payers and develop a follow up process should help to improve the payment turn-around time.
Being keenly aware of the timely filing guidelines for an initial claim as well as for appeals is a crucial piece of your accounts receivables process.
Hopefully you can enjoy the slower pace of the summer days and ensure that your practice is healthy!