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December 7, 2009

Happy, Healthy & Wise — Keys to Smooth
Practice Management

By Alice Shepherd
For The Record
Vol. 21 No. 23 P. 14

A healthy physician practice is one that operates with maximum efficiency and achieves excellent financial results while providing first-rate healthcare. That means good doctors also have to be good businesspeople. For physicians who don’t have time to get an MBA, here are several simple steps that can be implemented to improve practice productivity, performance, and patient satisfaction.

First, according to W. Edwards Deming, father of total quality management, there can be no improvement without measurement. Therefore, a regular assessment of a practice’s operations and financial condition is a prerequisite for enhancing performance. At Oliver Family Healthcare in Indianapolis, Gregory Oliver, DO, meets monthly with his accountants to examine financial benchmarks, such as monthly and yearly profit and loss compared with the previous year and as a trend for the current year. Then, they drill down to specific expenses and revenue sources looking for red flags.

Wichita Clinic Bethel-Newton in Kansas regularly measures its operational performance by examining key indicators such as the average time to the second or third next available routine follow-up appointment, the ability to accommodate same-day or urgent appointment requests, the time to the second or third next available well-adult visit type, the operations hold and phone cue times, the percentage of dropped or missed calls, and the average time to return calls left on voice mail.

Lee Mills, MD, the clinic’s department head of family medicine, also recommends a systematic quarterly comparison of coding practices with those of other physicians in the same specialty, both regionally and nationally. In addition, he audits his own coding every six months by going through the exercise of coding out 20 or more charges by hand. “It improves the quality of your coding in the future and lets you know where you’re systematically overcoding or undercoding your visits,” he says.

Stopping Financial Bleeding
Regular financial exams are bound to lead to the discovery of hemorrhages both small and large. “Particularly in paper-based practices, it’s easy to miss capturing all charges, especially small ones,” says Jim Morrow, MD, medical director at Allscripts. “You need a system that allows you to capture those at the point of care so you never miss billing for them.”

Oliver Family Healthcare realized it was losing more than $400 per month because immunizations were not always documented for billing. “Immunizations are so expensive that if you fail to record one dose or miss charging for it, it takes a while to recover that revenue,” says Oliver. “After analyzing how our providers ordered immunizations, how nurses recorded them, and how they were inventoried, we implemented a daily log. We assigned different people to specific days of the week to count, log, and sign off on all immunizations at the end of the day. The following morning, the billing department compares the log against ordered immunizations. Since implementing the log, we have seen no losses.”

Some practices lose substantial revenue by not collecting copays up front. “Billing your copays delays your cash receivables by at least a month, and a surprising number of copays are never even billed or paid,” says Mills. “Similarly, many practices fail to collect ‘free gifts’ by not utilizing codes that cover work above and beyond a standard E/M [evaluation and management] visit. Separate codes exist for nebulizer breathing treatments, peak flow assessments, tobacco cessation counseling visits, and home healthcare certification and recertification.”

Physicians who don’t take full advantage of time-based coding also may be leaving money on the table, according to Mills. “You can bill based on time if more than 50% of the time of your clinical encounter involved counseling and coordination of patient care,” he explains. “The power of time-based coding is also evident in extended physician services. For example, the standard time for an established hospital patient level 2 follow-up visit is 25 minutes. If, in a given 24-hour period, you spend more than 30 minutes greater than the standard time (ie, 56 minutes or more) on the unit involved in a patient’s care, you can bill an extended physician services code, 99356, that significantly increases your reimbursement. Similarly, if you spend more than the standard 30 minutes discharging a patient, using the proper code, 99239, will also increase your reimbursement.”

Streamlining Office Communication
“Effective communication between physicians, staff, and patients is critical for good patient care and efficient, financially rewarding operations,” says Morrow. “Unless the billing department can get its questions answered, it cannot bill in a timely manner. And if providers are not responsive to patient questions and concerns, they cannot render appropriate care.”

 Both Mills and Oliver state that a hallmark of an efficient practice is a physician-staff morning huddle. “You look at the day’s schedule to anticipate problems, documentation needs, or flow issues and address them before they cause inefficiencies,” says Mills.
“Sometimes hierarchies develop in offices where the doctors don’t want to talk to the staff,” says Oliver. “During our five-minute huddle, we read our mission statement, vision statement, or credo; have a motivational quote of the day; recognize staff members who have gone the extra mile; and resolve any scheduling conflicts for the day. Huddles make the day go much more smoothly.”

Mills notes that integrating the receptionists into a well-functioning team is essential to efficiency and patient satisfaction. “They are the visible face and voice of the practice,” he says. “They set the tenor and the public perception for the visit and in your community.”

Oliver has found that his practice runs more efficiently without an office manager. “I’ve seen office managers who couldn’t get any work done because they were a destination for complaints. Others became filters where everything bogged down because they wanted everyone to check in with them before taking action,” he says. “In place of an office manager, we have one experienced person in each area who is designated as an educational resource without being in charge of the other staff. Employees are adults who should be accountable for themselves.”

Mills recommends training staff to anticipate what information physicians will need to complete patient encounters. “For example, your medical assistant should know to check blood pressure lying and standing for any patient who complains of dizziness—before you see the patient,” he says.

 Oliver stresses the importance of positive reinforcement to motivate staff. “Our monthly bonuses reward employees for meeting office goals, group goals, and personal goals,” he explains. “The latter are mostly educational, such as learning a new task. Our expectation is that last month’s goals are goals forever. It’s amazing how our profits continue to grow and our mistakes and problems are decreasing.”

When Mills conducted a simple time-motion study by using a stopwatch to track his movements, he was surprised to learn how much time he wasted leaving the exam room to retrieve supplies, examination sheets, and sample medications. He had to leave the room in one out of four encounters, which took three minutes each time. Now protocols are in place to stock every exam room with everything needed to handle 90% of the encounters. Mills has also become vigilant about interruptions. “I used to respond to each e-mail as it arrived, which took at least two minutes and drew my attention away from the task at hand,” he says. “Dealing with just 12 e-mails a day adds up to 24 minutes, enough time to see another patient.”

Increasing Efficiency With Technology Tools
“Sometimes it’s tough to be both a good doctor and a good businessperson, but today’s information technology allows you to match those two goals,” says Morrow. “IT helps improve productivity and cost-efficiency on several levels. First, it requires fewer full-time staff to manage a medical office in the electronic environment than it does in a paper-based environment. Also, patient encounters become more efficient, which means doctors can either see more patients or finish earlier in the day. Electronic systems also provide the data to identify overstaffing or understaffing and areas of administrative waste. Without searchable data, you can only guess.”

Oliver has leveraged Allscripts’ Professional PM practice management software and the vendor’s EHR to double revenue and see patients in a more timely manner. “We’ve become extremely efficient,” he says. “When I go into the exam room, my nursing staff has already logged in the chief complaint and the history of present illness. In many cases, they will have the review of systems ready for me and brought down the diagnoses for any chronic conditions from the evaluation and management part of the visit, as well as any needed lab work and prescription refills. By the end of the patient encounter, the chart and orders are complete, prescriptions have been transmitted, and testing has been requested.”

“Without EMR, practice management software is just a fancy electronic billing system,” says Morrow. “EMR and PM systems work hand in hand to help you manage the business side and the healthcare side of your practice. No so-called EMR lite is going to do the job. Only fully implemented EMR and PM systems will allow the practice of quality medicine. A paper-based system does not allow you to track in what percentage of cases you have met the standard of care with regard to chronic disease management and health screening. For instance, have your diabetic patients had a hemoglobin A1C test in the last six months? Have your men over 50 been in for a PSA [prostate-specific antigen test]? Have your patients over 50 had a colonoscopy? You can’t measure those things unless you have data. You need searchable electronic records.”

Oliver also uses data-mining software that makes automatic phone calls to remind patients of appointments or to make appointments. “The system keeps our schedule full and has increased our revenue dramatically,” says Oliver.

To measure satisfaction, the practice surveys its patients regularly. Providers and nurses ask each patient at the conclusion of every visit whether anything could be done to improve the experience. In addition, during a random week each month, all patients who visit are asked to complete a survey. Suggestions, problems, and trends are analyzed by the executive committee and handled as appropriate. In an effort to improve productivity, performance, and patient satisfaction, Oliver continually studies the best practices of nonmedical businesses and incorporates them into office operations whenever feasible.

The Magic Answer
“People often want to know the magic answer to running an efficient office,” says Mills. “Efficiency in operations and clinical practice is a game of inches. Little interruptions and inefficiencies that take only seconds add up to minutes and hours that could be better spent seeing patients. Small steps, when practiced consistently, conscientiously, and systematically, can make a big difference.”

Oliver notes that attitude is a critical factor in practice management. “A physician’s attitude pours through the practice,” he says. “Unhappiness transfers to the staff and decreases productivity. If you’re unhappy with your practice, read some good books, attend motivational seminars, and adopt a positive attitude. Staff will respond accordingly.”

— Alice Shepherd is a southern California-based business-to-business journalist specializing in healthcare topics.


Conducting a Workflow Analysis
Deborah Robb, BSHA, CPC, RMAI, RPI, a physician management consultant at HealthPort, recommends that practices review their workflow processes—from the time a patient is scheduled to the time payment is received—before attempting any performance improvement initiative. Analyze each area and ask questions such as the following:

• Are front-desk staff recording accurate information when a patient is registering or scheduled for a visit? Transposed numbers in a patient’s Social Security or ID number lead to denials. Are patient copays accurately identified and collected? About 10% of errors occur in the front office, says Robb.

• Are nurses and medical assistants capturing accurate information on a patient’s reason for visiting? Are they documenting all the required components to maximize and capture an effective visit level?

• Do physicians understand all of the components of history, exam, and medical decision making to establish the appropriate level? Are they documenting a diagnosis related to each encounter, procedure, and ancillary service? Are they charging for the correct level of visit? If patients have financial difficulties, remain legal by using the practice’s hardship fund rather than charging for a lower level visit, suggests Robb.

• Are physicians documenting preencounter and postencounter time for reviewing records and tests, arranging for further services, or communicating with other professionals? These services are part of the patient encounter.

• Are providers downcoding or upcoding? Both are equally illegal and raise red flags with payers. Practices that undercharge consistently become “outliers,” which may trigger an audit.

• Do coders understand the guidelines, requirements, and visit levels? Do they know where to look up local and national carrier determinations? If Medicare or insurance is not going to cover an ordered lab, are patients being asked to sign an advanced beneficiary notification so they know they will have to pay out of their own pockets? Unless the patient signs the notification, the practice cannot collect the funds, Robb cautions.

• Do bills accurately reflect the visit? Is the place of service correct? Are claims going out error free and clean, including any modifiers? Does the diagnosis match the procedure? How are fees and payments entered? Are super bills, if still in use, up-to-date and accurate? Is the fee schedule up-to-date? If not, have it reviewed professionally and make sure you’re getting correct reimbursements, says Robb.

• What is the accounts receivable turnaround time on claims? Is the practice receiving the rate it should? Is it receiving the total reimbursement the physicians deserve?

• What are the reasons behind the top 10 denials? Are they due to true medical necessity or a front-office or coding issue necessitating training? Don’t chastise staff for errors but view them as a training opportunity, says Robb. Training is always most effective when done proactively rather than after errors have occurred.

— AS