Unfortunately, many physicians are working harder at bettering their practice but aren’t reaping the rewards. There are proven strategies to use to increase practice revenue. We want to provide you with specific, actionable ideas.
After cutting costs, it’s time to look for ways to add additional revenue to the bottom line.
Healthcare Consulting Tip 1 to Improve Medical Practice Profitability: Consider Time and Pace Efficiencies
The most beneficial item to start with is helping the physicians add time to the year or improve efficiencies. You can add time to the year by lengthening the work week and/or taking fewer vacations. Also, consider adding a new associate or physician extender to create efficiencies. Take a look at the tempo of your office. Where are the bottlenecks? Are the processes efficient, or could they be improved? Are there long periods of wasted time? Could additional associates be added to pick up the pace?
Not sure when it’s the right time to hire a physician or mid-level/advanced practice providers (APP)? Start by evaluating your wait time. If it’s over 90 days long, this should be a consideration for your medical practice.
Increasing the tempo with which your office operates creates margins for you to fill with more patient visits. Speaking of more patient visits, pack the schedule. Get the patients in, move them through the process efficiently, and remove downtime. When your physicians and staff leave at night, they should be tired.
Healthcare Consulting Tip 2 to Improve Medical Practice Profitability: Ensure You are Capturing All Revenue
Many times, revenue can be found just be tightening up the productivity within each patient interaction. Ensure you’re capturing all the charges possible. Coding errors account for missed reimbursements, so make certain you are coding consistently and correctly. And, account for charge tickets or hospital activity.
Evaluate your fee schedule annually and make adjustments to your charges to capture all revenue. Identify the procedures that are profitable and those that aren’t. Do you know how much you’re getting paid per procedure and the costs associated with each procedure? Define the profit margin of each procedure to determine if you want to continue offering it.
It can also be helpful to review your revenue sources. Review several years’ worth of revenue data to identify a payor mix trend. Also, analyze your procedure mix. It’s also a good idea to evaluate your referral pattern since it changes over the years. Referral income is substantial enough not to ignore this potential revenue opportunity. Identify who is not referring to you and why so that you can attempt to remedy any issues. This work could yield many years’ worth of referral revenue.
You’re good at what you do. Don’t be timid about getting paid well. Collect for your services. Make sure you follow up on any denied claims and that all of them have an outcome. Also, take a look at any professional discounts and courtesy write-offs as these can add up quickly.
Are you collecting all co-pays and deductibles? If not, you should revise your collection produces. Being successful in this effort may actually require more work on the front end by having your schedulers inform patient of the cost, due dates and payment options.
Healthcare Consulting Tip 3 to Improve Medical Practice Profitability: Evaluate Your Staff
Match staff capacities to the demands of your office. Identify where there are bottlenecks and attempt to bridge the gap either with a process improvement or adding staff. Think through what could be limiting your medical practice and if there are simple, inexpensive ways to remove those barriers.
Another important area that often goes unnoticed is the temperament of your collections staff. It takes a specific personality to handle collecting money. Ensure you have the right person in that role. Sweet Sally is not the right person.
Did you know that medicine is the perfect environment for employee theft? Limited staff + lack of segregation of duties + large exchanges of cash = recipe for disaster. Ensure there are proper internal controls in place to prevent employees from taking advantage of opportunities to pocket your hard earned money.
Additional Healthcare Consulting Tips to Improve Medical Practice Profitability
Here are a few additional ways to add new revenue:
Add to your schedule
Offering nights and/or weekends could add additional revenue and could potentially differentiate you from competitors.
Additional offices broaden your scope of potential new patients. Since so many rural locations are underserved, this could potentially be a revenue jackpot for you.
Hire other specialists
Add additional depth to your medical practice or consider trying to make it a one-stop-shop by adding other services, additional procedures and/or additional specialists (for example, adding a pediatrician to a family practice or adding an endoscopy specialist to a gastroenterology practice).
Showcase your medical practice online
Establish a website for patients to get to know you—who you are, where you are, what you do and how you help patients. Talk to your receptionist to identify frequently asked questions so that you can highlight the answers on your website. This prevents potential patients calling with questions or leaving your site to find answers on a competitor’s website.
Moving Forward with Improving Medical Practice Profitability
These are just a few examples you can take to increase revenue in an effort to increase your practice’s profitability. In addition to this exercise, we also recommend that you consider cutting costs, which you can read more about in this article. Warren Averett’s Healthcare Consulting Group has experience serving over 500 medical practices, helping them operate more efficiently and profitably.