Does your practice know how well it is performing – and if not, why not? It’s important for physicians and managers to examine performance each month by looking at specific Key Performance Indicators, KPIs. This will help you understand your position and is powerful in guiding decisions to improve performance. Medicine is a business and it’s time to take this seriously.
Here are a few basic KPIs to look at each month:
- Income and itemized expenses as a total percentage of income. This will tell you where the money goes. The highest expense is likely to be staffing costs. If this shows a jump it may be due to inefficiency that results in staff working overtime or adding another staff member to support the inefficiency. Then again it might be poor morale, resulting in lower productivity.
- Accounts receivable. The average A/R for physicians runs around 1.5 months of charges, if yours is more than 2 months it is important to examine billing procedures and find out what’s causing the problem. Is it becomes someone is on vacation, the computer crashed, claims rejections or a lack of attention to aged accounts? Speaking of aged accounts if the amount 90 days aged of more is above 18% get more assertive with collection pursuit.
- Productivity reports are included in the month-end management reports typically produced by the practice manager and reveals the total charges, receipts and adjustments for the practice and should also compare each physician’s individual production. Keep an eye on fluctuations that need to be explained. Sure, one docs charges will be down if on vacation or ill, but otherwise start looking for the cause. If adjustments are climbing, dig to be sure staff understands legitimate insurance adjustments and fights for your money when insurance plans make errors. Industry expert, Healthcare Business Advisors, states that 30% of claims in the US are denied and of that 15% are never resubmitted, despite the fact that 70-80% of appealed claims eventually get paid. Be proactive and get what you deserve!
- Missed appointments cost the practice plenty, so track them. More than one or two a day is not okay. Four missed appointments a day is projected to be a loss of more than $150,000 a year. You can’t afford to miss out on that kind of revenue. Improving your scheduling patterns and philosophy is an investment that pays off!
- Access. Managers need to keep an eye on how long patients wait to get an appointment. This is simple to track by just looking at when the next available appointment is. Don’t look at the first appointment, which is likely due to a cancellation. Instead, look at the third available appointment out. If it’s more that 10 days, access is an issue. Poor access compromises service and patient compliance. It can also be a cause for missed appointments. If patients scheduled 10 days out they are likely to get better, go to another physician or forget the appointment altogether.
Capko & Company – Our mission is to make your practice shine!
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