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Category : Primary Care
Medical practice management 101: Budgeting
Creating a medical practice budget is one of the most important elements of running a profitable physician practice, doctor’s office, or physical therapy clinic. The medical practice budget provides physicians, office managers and administrators with a gauge from which financial performance can be measured and operational issues identified.
There are many ways to create a medical practice budget, however our firm often recommends use of a budgeting format which clearly distinguishes those revenues and expenses that are variable in nature (change from month to month) from those that are fixed (relatively consistent from month to month).
To create a medical practice budget which outlines revenues and expenses in this way is quite easy to perform, and the reporting that comes from this type of budget is of the most easily understood.
Starting with revenues, create a list of all sources of revenue for your medical practice. Use large categories to capture the largest sources of revenue, then gradually break down the large categories into smaller subsets of revenue.
For example, if your physical therapy clinic provides two main types of services – physical therapy and fitness classes – then these might make up your two main revenue categories for your medical practice budget.
You may wish to further break down the “physical therapy” category into subcategories such as “orthopedics,” “pediatrics,” and “women’s health.” Your fitness classes may also be broken down into subcategories such as “weight management,” “strength training,” and “flexibility.”
It is a good idea to capture your “adjustments to revenue” within your revenue section as it is normal to collect much less than is charged to insurance companies. These adjustments are captured in the revenue section of the medical practice budget, along with any refunds that are credited back to clients through the course of business.
Moving to the expenses category, start by breaking all of your expenses down into “variable” and “fixed” expense categories. A rule of thumb that is often used to determine which expenses are variable versus fixed is to consider all expenses that would diminish or cease upon closure of your medical practice for a period of a month or so. Expenses such as clinical staff (often paid based on production or hours worked), hourly office and administrative staff, most utilities, office supplies, and repairs/maintenance would likely diminish or cease, and are therefore examples of variable expenses in some medical practices.
Expenses that would remain unchanged if your medical office closed for a month or so are considered “fixed” and would likely include your fixed management salaries, lease payments, loan repayments, dues/subscriptions, and contractual advertising expenses.
The rules for breaking medical practice expenses into variable and fixed categories are not hard and fast, but are rather dependent upon the operations of the medical practice, as well as the reporting that is desired of those that will be managing the medical practice budget.
After all revenues and expenses are accounted for within the medical practice budget, all expenses are subtracted from all revenues to come up with a number known as “net income.” Net income reflects the profitability of the time period examined by the medical practice budget, accounting for all recorded revenues and expenses.
You can likely see that without a medical practice budget, the ability to truly understand where, why and how revenues and expenses are generated is nearly impossible. By creating a medical practice budget, sticking to it, and revising it annually, your medical practice will have much more chance of success and profitability, and is therefore highly recommended.
If you’re interested in starting or improving your own medical practice budget, please visit the Vantage Clinical Solutions website to download a free medical practice budgeting tool that can be used within your medical practice, doctor’s office, or physical therapy clinic.
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Tannus Quatre is a private practice consultant and principal with Vantage Clinical Solutions, Inc., a nationwide healthcare consulting and management firm located in Bend, OR and Denver, CO. Tannus specializes in the areas of healthcare marketing, strategy, and finance, and can be reached through the Vantage Clinical Solutions website.
Medical practice management 101: Scalability
In this new series on The Healthcare Entrepreneur Blog, we’ll be taking a look at a number of medical practice management concepts that medical practice managers, administrators, and clinic owners should consider as part of their planning and day-to-day management. The principles we’ll be outlining as part of the Medical Practice 101 series are applicable to all types of medical practices including general medicine, the surgical specialties, and rehabilitation services such as physical and occupational therapy.
Here, we’ll discuss the concept of scalability as relevant to medical practice management. Scalability is the ability for a medical practice to expand its current systems, infrastructure, operations, and staff alongside the growth of the practice over a number of months or years. Scalability is an area of medical practice management that is not always fully considered when planning for the implementation of electronic medical records and business systems used to run and administer the medical practice, and can end up costing a medical practice severely in terms of time and money in order to meet the changing demands of a practice over time.
When planning for the use of electronic medical records (EMR) and practice management software (PMS), one of the scalable solutions that we like around here is the the use of web-based software or software-as-a-service (SAAS). The use of web-based or SAAS solutions allows a practice to operate one medical facility just as easily as operating two or more sites because the infrastructure used to link each user with the medical practice database exists via the internet. The need for a robust hardware infrastructure, including servers and virtual private networks (VPN’s) is minimized, and with it – the upfront cost of implementation.
Web-based software is typically provided on a per-user license basis, meaning that as additional providers or staff join the practice, additional licenses (or ’seats’) are purchased which allow the medical practice to easily grow, or ’scale’ their investment alongside the growth of the medical practice. Web-based software is a very scalable solution when it comes to medical practice management, which is why our medical practice consultants often recommend web-based solutions to our clients when determining solutions that will allow them to continue with their medical practice management infrastructure over the long haul.
_________________
Tannus Quatre is a private practice consultant and principal with Vantage Clinical Solutions, Inc., a nationwide healthcare consulting and management firm located in Bend, OR and Denver, CO. Tannus specializes in the areas of healthcare marketing, strategy, and finance, and can be reached through the Vantage Clinical Solutions website.
Physician office sends patient data to wrong fax number…for 3 years
A Tennessee physician practice apparently sent out hundreds of faxes to a wrong fax number, breaching the privacy of likely hundreds of patients over the course of 3 years. Lots of questions about this one, like the obvious one: why wasn’t this remedied after the first error?
This is a huge HIPAA violation, and should serve as a reminder to make sure procedures are in place to verify and cross-check fax numbers and all other addressed material for all patient-related communications.
“This is a total breach of privacy,” Keith said. “This is supposed to be confidential, and it just so happens we have some scruples here and wouldn’t do anything with that information. We’ve shredded them, but you can have a file an inch thick in no time.”
via Doctors mistakenly fax patients’ data to Indiana company | The Tennessean.
Blogging in healthcare: The power of instant communication
Blogging can (and should) be considered a powerful strategy used for marketing, publicity, and even damage control for an organization who’s stakeholders exist online. For small private practices and large healthcare organizations alike, the power of blogging to reach an audience is often underestimated. The article below from Health Leaders Media does a great job of outlining the benefits of a blogging strategy for healthcare providers, as well as some tips on who and how blogging should be performed.
A blog can be a powerful way to get a hospital’s message out to the public, says Mark Whitman, vice president of digital marketing at Ohio-based brand consulting firm Northlich. “A big advantage of blogs is that information can be shared quickly among all stakeholders,” he says. “Quick response and sharing of information can help stop misinformation and rumors that can be very damaging during times of crisis.”
via Hospital Blogs Can Help During Times of Controversy | www.healthleadersmedia.com
$15 million Medicare fraud scheme paid kickbacks to fraudulent patients
Two Miami residents have plead guilty to submitting over $15 million in false and fraudulent claims to Medicare for heathcare services that were either not necessary or not provided from March 2006 through March 2007. By itself this is a tragic tale, but the fact that the criminals paid cash and narcotic kickbacks to Medicare beneficiaries in return for their co-conspiracy in the fraud scheme is disgusting.
In his plea, Jose Rosario also admitted that Medicare beneficiaries were neither referred to Sacred Hope by their primary care physicians, nor for any other legitimate medical purpose, but rather were recruited to come to the clinic through the payment of kickbacks. In exchange for their kickbacks, the Medicare beneficiaries would visit the clinic and sign documents falsely indicating that they had received the services billed to Medicare. According to information contained in the plea documents, kickbacks came in the form of cash and prescriptions for narcotic drugs. Jose Rosario admitted he directed his nephew, co-defendant Arnaldo Rosario, to oversee and facilitate the payment of cash kickbacks to the Medicare beneficiaries. Jose Rosario admitted that he would routinely obtain cash that he would provide to Arnaldo Rosario for the purpose of paying the beneficiaries cash kickbacks.
And, this is just the tip of the iceberg. The Miami case was brought forward by the Medicare Fraud Strike Force, who since their inception in March 2007, have obtained indictments of nearly 300 persons and organizations that have billed Medicare close to $700 million.
Click to read the full article from the USDOJ
Nurse Practitioners As Primary Care Doctors
Some estimate that as many as 125,000 nurse practitioners throughout the U.S. might have a sizable impact on the primary care shortage. In Boston, wait times are about as bad as they get, providing the impetus for finding a solution quickly.
Trying to get an appointment to see your primary care doctor can be a burden. In Boston, the wait time to see a physician is the worst in the country, with an average of almost 50 days.
via Nurse Practitioners Can Practice As Primary Care Doctors.
Patients have a voice online…and they’re using it
One of the best things about the Internet is ease of communication. Whether you want to learn from others or share your own story, the flow of information is a mere click away. And it just so happens that learning, sharing, and clicking is exactly what patients are doing.
Through a growing number of business and healthcare review websites, patients are speaking openly about their healthcare experiences, and in a candid manner. From the best of experiences to the worst, your patients have a voice online…and they are using it.
The opportunities and threats that lie within online reviews is staggering. Several 5-star ratings and your practice stands clearly apart from the crowd. One or two bad ones however, and online window shoppers might decide that taking a chance on your practice isn’t going to make their “to-do” list.
The good news is that you likely have many patients in your practice this very day who would be honored to provide you with the highest of online marks…if they only knew where to start.
The trick is to (1) Know what your patients are already saying, and to (2) make sure your most pleased patients are speaking about you online.
And how do you start, you ask? It’s easy.
Step 1: Know what your patients are saying
Visit the most popular online review sites, and see first-hand what is being said about your practice. Many sites exist, and we recommend you stick with the big ones, at least to start. General sites like Yahoo Local, Google Maps, Yelp, and Angie’s List are some of the most popular.
Following this, healthcare specific sites such as HealthGrades, RateMD’s, and Vitals.com are good places to look for categorical reviews of your performance by your patients.
And if you’re not seeing reviews of yourself or your practice, don’t feel left out. It’s simply time to proceed to Step 2 and start building your online reputation.
Step 2: Get your pleased patients talking
This part is easier than you might think. Simply start by educating your Internet-savvy patients as to the benefit of online feedback for your practice. You’ll be surprised at how quickly your patients will flock to tell the masses about how you’ve cared for them, helped their family, or saved their life. If you want to make it a step easier, provide links to popular review sites from your website. Help them out by providing these links, and they’ll be a-clicking away in no time.
Everybody wants cheap advertising, and leveraging the benefit of online reviews is about as cheap as it gets. Don’t forget however, that online reviews work both ways. For every possible good remark, there is also the potential for a bad, which can work in the wrong direction for your practice. Putting some time and energy into making sure your practice’s online reputation is a good one is an investment well made.
As always, we’re here to help, and if you have any questions about how to build your 5-star online rating, or to clean up online reputations that need some work, know that we’re just a call or click away.
Medical association fights back against RAC’s
The Texas Medical Association is fighting back against RAC’s through a lawsuit that claims false assertions during a medicare recovery audit. You can bet that people on both sides of the RAC issue will be paying attention to this one.
“This is about protecting our patients’ private health information and fair treatment for physicians,” says Richard J. DePersio, MD, president of the 7,800-member TMA. “Our members complained to us about the HRI ’strong-arm’ letters. We had to act because we cannot tolerate business practices that ignore state law and contracts, threaten patient privacy, and make false accusations of physician fraud. The threats and intimidation tactics used by HRI were a catalyst for our actions.”
via Tennessee Medical Association Sues Recovery Contractor
Online doctor reviews and how patients are using them
One of the best things about the Internet is ease of communication. Whether you want to learn from others or share your own story, the flow of information is a mere click away. And it just so happens that learning, sharing, and clicking is exactly what patients are doing.
Through a growing number of business and healthcare review websites, patients are speaking openly about their healthcare experiences, and in a candid manner. From the best of experiences to the worst, your patients have a voice online…and they are using it.
The opportunities and threats that lie within online reviews is staggering. Several 5-star ratings and your practice stands clearly apart from the crowd. One or two bad ones however, and online window shoppers might decide that taking a chance on your practice isn’t going to make their “to-do” list.
The good news is that you likely have many patients in your practice this very day who would be honored to provide you with the highest of online marks…if they only knew where to start.
The trick is to (1) Know what your patients are already saying, and to (2) make sure your most pleased patients are speaking about you online.
And how do you start, you ask? It’s easy.
Step 1: Know what your patients are saying
Visit the most popular online review sites, and see first-hand what is being said about your practice. Many sites exist, and we recommend you stick with the big ones, at least to start. General sites like Yahoo Local, Google Maps, Yelp, and Angie’s List are some of the most popular.
Following this, healthcare specific sites such as HealthGrades, RateMD’s, and Vitals.com are good places to look for categorical reviews of your performance by your patients.
And if you’re not seeing reviews of yourself or your practice, don’t feel left out. It’s simply time to proceed to Step 2 and start building your online reputation.
Step 2: Get your pleased patients talking
This part is easier than you might think. Simply start by educating your Internet-savvy patients as to the benefit of online feedback for your practice. You’ll be surprised at how quickly your patients will flock to tell the masses about how you’ve cared for them, helped their family, or saved their life. If you want to make it a step easier, provide links to popular review sites from your website. Help them out by providing these links, and they’ll be a-clicking away in no time.
Everybody wants cheap advertising, and leveraging the benefit of online reviews is about as cheap as it gets. Don’t forget however, that online reviews work both ways. For every possible good remark, there is also the potential for a bad, which can work in the wrong direction for your practice. Putting some time and energy into making sure your practice’s online reputation is a good one is an investment well made.
As always, we’re here to help, and if you have any questions about how to build your 5-star online rating, or to clean up online reputations that need some work, know that we’re just a call or click away.
_________________
Tannus Quatre PT, MBA is a private practice consultant and principal with Vantage Clinical Solutions, Inc., a nationwide healthcare consulting and management firm located in Bend, OR and Denver, CO. Tannus specializes in the areas of healthcare marketing, strategy, and finance, and can be reached through the Vantage Clinical Solutions website.
Interstate competition for primary care doctors
Competition for a shrinking pool of qualified primary care doctors is hurting states that have a hard time recruiting against higher paying markets. For Vermont, the lure of a high quality of life isn’t quite enough it seems.
The reasons for the doctor shortage, which has been gradually worsening over the years, are well documented. Much of the problem boils down to money. Medical students who opt to specialize rather than enter primary care practices stand to make significantly more because specific procedures earn higher reimbursements than generalized care and diagnoses. For medical students leaving school with debt loads often topping $150,000, the decision to enter primary care practice often means a degree of financial hardship, according to survey-based research conducted in Vermont and nationwide.
Exerpted from: Doctor shortage proves painful to state: Times Argus Online.
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