Transform your practice by using benchmarks. DO YOU KNOW HOW WELL OR POORLY YOUR PRACTICE IS doing financially? Do you base this judgment on how you did in previous years or on the size of the deposits you bring to the bank? If so, your analytical process is sadly lacking. In order to truly know the state of your practice, you should be using benchmarks as part of your analysis. Simply put, benchmarks are statistical data that allow you to compare your practice with averages for practices like yours.
Benchmarks give you a frame of reference and a baseline for comparison that makes the analysis you do more meaningful. Even so, you’ll find that many doctors are not familiar with such benchmarks and don’t know how to use them.
Benchmarks are available that can help you analyze every aspect of your financial picture. Hiring a new office manager or physician? There are benchmarks you can use to compare salary levels based on experience. Thinking of increasing the number of your support staff? Benchmarks can tell you if this is a wise investment based on the average number of support staff per physician for practices like yours. You may be analyzing your accounts receivable every month (and if you are
not, you should be), but without benchmarks for comparison, those numbers aren’t really meaningful. For example: One benchmark shows that in a typical family practice with a diverse mix of Medicare and private payers, 95 percent of billed charges While many complementary and alternative medicine (CAM) practitioners utilize these therapies, it’s the use of both traditional and complementary therapies that sets the integrative medicine practice apart. Integrative medicine emphasizes early diagnosis and prevention. And nutrition and nutritional supplements play a key role. If disease has already been diagnosed, the goal is to slow down or reverse the disease process.(minus any adjustments) should be collected within 45 days. Even if your practice is different, this kind of guideline is helpful when evaluating your receivables.
Make comparisons with practices that are as much like yours as possible.The closer the fit, the more accurate the benchmark data. For many integrated practices, comparisons with physical medicine and rehab practices will provide a high degree of accuracy. Benchmarks can be especially helpful in evaluating your rehab department’s productivity. It is vital to do this if you are using expensive providers such as physical therapists.
You’ll find benchmarks for the number of patients seen per day, seen per hour, and for the number of relative value units billed. The number of visits to discharge is also available, as well as hard financial data such as the average reimbursement for different PT codes. Armed with this data, plus the average salary for physical therapists and ancillary personnel such as PTAs, you can determine how your therapy department is performing relative to the average for your geographic area. If you’re just getting started using benchmarks, keep things simple. You don’t need an MBA in healthcare to track the performance of your practice. Key areas to benchmark include:
your basic monthly report (number of new patients, number of visits, amounts billed, and amounts collected), and accounts receivable aging report. For physical therapy services, track and benchmark: total visits per month for each patient, total units per visit, amount billed per visit, and cost of the therapists.
If you are below average, this information will make it easy to pinpoint what the problem is. There are many sources of benchmarks, but the best source is arguably the Medical Group Management Association (MGMA). They offer a treasure trove of benchmarking data, and it’s available online. Once you incorporate medical benchmarks into your practice analysis, you will wonder how
MARC H. SENCER,MD, is the president ofMDs for DCs, which provides intensive one-on-one training, medical staffing, and ongoing practice management
support to chiropractic integrated practices. He can be reached at 800-916-1462 or through mdsfordcs.com.
Check your knowledge of benchmarks with this true or false quiz.
1. You should use benchmarks to analyze the accounts receivable aging report.
2. Benchmarks cannot help you to pinpoint inefficiencies in your rehab department.
3. Benchmarks can help you decide if you need more support staff.
4. TheMGMA is a great source of benchmarking data.
No. 2 is false.
Nos. 1, 3, and 4 are true.
One of the best uses of benchmarks is in analyzing the productivity of your rehab department.