enhancing services to new & existing physician practices

Enhancing Services to New & Existing

Physician Practices

Reed Tinsley, CPA

Why I Don’t Like My CPA

Not enough attention Doesn’t help me in my business Brings few new ideas to my attention NOTE: IT’S RARELY ABOUT PRICE

IF THE VALUE IS THERE

How to Enhance Services Add Value to Current Accounting

& Tax Services Develop Specialized Healthcare

Services Create Client Contact Program

– Formal Management Meetings– Fixed Meeting Dates– Get In Front of the Client Often!!!!

Specialized Services to Consider

Contract Review Practice Management Reporting EOB Review Billing/Collection Analysis Accounts Receivable Review Visit Coding Worksheet/Analysis Managed Care Contract Negotiation Physician Compensation

Specialized Services to Consider

Regulatory Review– Stark– OSHA– HIPAA

Strategic Planning Practice Transition Practice Valuation

Adding Value to Current Services

Practice Financial StatementsPractice Financial Statements

Why so Important and What to Look For– Balance Sheet

• Aging of Accounts Payable• Excessive Non-Strategic Debt

– Income Statement• Proper Presentations• Compare revenue to payments posted in billing

system

Financial Statement Financial Statement AnalysisAnalysis

Financial Statement Review– Analyze overhead % of collections– Comparison to prior year

• Must see comparative financials• First step: compare total overhead

amounts

– Line item overhead category analysis– Department overhead analysis

Comparison - % of Comparison - % of CollectionsCollections

Industry Benchmarks– MGMA– Medical Economics– National Society of Certified

Healthcare Consultants– Other client practices in similar

specialties

Comparison - % of Comparison - % of CollectionsCollections

Flaw in this Analysis– Assumes practice has maximized its

collections– Assumes there has been no decrease

in production/collections– Assumes a comparison of “apples to

apples”

Provide Opportunities for Overhead Reduction

Payroll CostsPayroll Costs Analyze Total Personnel Needs

– Too many or too few? Analyze Actual Compensation

Levels– Overpaying for specific positions?– How to handle long term employees

Analyze Overtime Pay– Exempt vs. non-exempt employees– What is causing excessive overtime?

Employee BenefitsEmployee Benefits

Analyze Health & Other Insurance Costs– Benefit coverage– Employee subsidy

Analyze Retirement Plan Costs Hidden Costs

– Vacation leave payouts– Sick leave payouts– PTO payouts

Supply CostsSupply Costs

Medical, Office, Drugs, etc.– Inventory control

Review Vendor Relationships and Pricing– Bid periodically– Centralized management– Use purchase order system– Utilize internet purchasing

Unique Cost Saving StrategiesUnique Cost Saving Strategies

Merging Medical Practices MSO Formation/Utilization IPA Formation Adding a Physician Changing the Physician Compensation

Formula Office Sharing with Another Practice Implementation of EMR Make Stakeholders out of the Employees

Help Build New Revenue

Opportunities

How to Build Revenue – How to Build Revenue – GenerallyGenerally Adding Ancillary Services Adding Non-Ancillary Services Adding Physician Extenders Adding Locations Improving Practice Operations Creating Alliances (Merger) Research Six Sigma – Practice Reengineering

How to Build Revenue – How to Build Revenue – GenerallyGenerally Renegotiate Managed Care

Contracts Implement EMR

– Track Quality Measures Have a Strict Recall Program Pay Attention to Lower Portion of

Referring Doctor Report After Hours/Saturday Clinic Surgery Center Development

How to Build Revenue – How to Build Revenue – GenerallyGenerally Do You Have a Practice That

Patients WANT to Refer to? Meet Human Resource Director at

Largest Employers in Your Service Area– What Services Can You Provide On

Site?– What are Educational Opportunities

for Employee Group?

How to Build Revenue – How to Build Revenue – GenerallyGenerally Walking and Talking – Free Talks

– Churches– Senior Centers/Assisted Living

Facilities– Neighborhood Associations– Schools

Integrate Yourself with Hospital’s Marketing Program

Build a Public Relations Program

Review and Review and ImplementationImplementation

Of Practice Internal ControlsOf Practice Internal Controls

The Front DeskThe Front Desk

Billing/CollectionBilling/Collection

The Business OfficeThe Business Office

Accounts PayableAccounts Payable

Look for Signs of Financial Look for Signs of Financial ProblemsProblems

Sudden Change in A/R Tendencies Failing to Reach Benchmarks Sudden Changes in Production by

Doc Escalating Overhead Costs Doctors Holding Their Paychecks Cannot Pay Vendors Timely Borrowing Money

Are you taking care of the physician’s personal finances Adequately insured Asset protection Retirement planning Is a will in place Estate planning Building Net Worth

Example of Specialized Service

PRACTICE MANAGEMENT REPORTING

(You can’t manage what you don’t measure)

ConceptsConcepts

Numbers Don’t Lie!!!! Benchmarking

Only one benchmark that counts: Did the physician make more money this year than last year

Practice Management Practice Management ReportsReports

PMR For the Practice By Individual Physician On a Comparative Basis

Clinical Activities Reports Accounts Receivable Reports Dashboard Indicator Report

The NumbersThe Numbers

• Gross Collection Percentage• Net Collection Percentage• Days in A/R• A/R Ratio• A/R in excess of 90 days old• This year better than last year?• Clinical Encounters• Provider Work RVUs• Referring doctor trends

Organizations to Join

Medical Group Management Assn– www.mgma.com

American Health Lawyers Assn– www.healthlawyers.org

Healthcare Listservs

MGMA Discussion Groups– www.mgma.com

Part-B Listserv– www.partbnews.com

AHLA listservs

Keys to Success

Quit using the “I don’t have time” excuse Make a commitment as a Firm Stay very hands-on with your MD clients

– Stay visible!

Work for free if you have to (to shorten the learning curve)

Questions and Answers

Reed Tinsley, CPA, CVA, CFP, CHBC