While it is tempting to look only at "the bottom line," the contemporary physician manager/owner needs to have a more thorough understanding of the numbers that contribute to that bottom line and how to use that information to quickly discover problems and solutions.
Standard reports: Evaluating progress
These reports should be reviewed at regular intervals by the practice's decision makers. Important principles of review include comparison to benchmarks, budgetary goal setting, and trending. Just as we monitor the progress of our therapeutic interventions with lab and imaging tests, we must evaluate progress toward meeting our financial goals and assess the effect of any business interventions.
The statistical report: A 'snapshot'
The medical practice statistical report summarizes the clinical activities, production, collections, adjustments, and accounts receivable data of the practice. Related financial metrics are prepared from this data. The purpose of the report is to provide the physician/manager with a high-level snapshot of the practice and offer guidance on where to apply resources for addressing any concerns/problems.
According to Tinsley, the first step in the analysis of the snapshot is an examination of production. Production can be defined in financial terms (gross revenue) or as a measure of clinical activity, such as frequency of CPT charges. Trending of production is paramount in the analysis of a medical practice. Mature urology practices should exhibit minimal production fluctuation that cannot easily be explained by vacation or other absences. If productivity is not consistent, there could be one or more root causes to consider:
Delay in hospital charge submission. While many offices have established routines that result in a reliable office charge submission, many practices struggle to apply this same discipline to submission of hospital charges. The busy urologist may not have a consistent method to communicate charges for consultations, emergency surgery, or even elective cases performed miles from the office. Delays in dictation, even for routine surgery, may delay the certified coder's ability to bill a case.
The longer the delay between a service and the charge submission, the greater the opportunity for missed or inaccurate charges. A structured approach to hospital billing, such as a daily verbal, electronic, or physical download to a billing clerk, will effectively address this potential problem.