Last year in my newsletter I wrote an article about New Year resolutions for medical practices and their management. Well another year has gone by and I’m still disappointed that most practices out there just don’t get it. The same mistakes keep occurring, strategic planning is basically non-existent, and most are content with sitting on their hands and living the day to day. If that is the case, then why is everyone complaining about their take home pay? Again, I just don’t get it.
A recent book entitled “When Professionals Have to Lead: A New Model for High Performance” by the Harvard Business School Press mentions that most professional service firms (yes, a medical practice is a professional service firm) often focus on the short term and spend little time and thought on providing direction on where the practice is going and why. This is so typical of medical practices. You need goals and objectives to guide you throughout this next year – without them, you are just a rudderless ship.
So again, here are the New Year resolutions repeated; use them to set your own practice goals and objectives for 2017:
I RESOVE to inspire and motivate my employees Believe it or not, this is an easy one to accomplish. Employees can be inspired and motivated just by doing a few simple things – when they do a good job, tell them they did so. Tell them thank you for a job well done and thank them for their efforts and for being a part of your team. Make the effort to take each employee individually to lunch. Get their feedback on what is good about the practice and what can be improved. Surveys have shown these little things do more for office morale than salary increases do. Remember a very important point: The better performing offices are the ones that do the best at human resources.
I RESOLVE to have a monthly management meeting Even if you are a solo medical practice, this meeting is critical to maintaining and improving the financial performance of the office. At the meeting, review and discuss such things as practice finances, billing and collection performance and comparison to benchmarks, office operations, and human resource issues. These meetings keep management informed and on the same page. How can an office be successful unless everyone is informed and pulling in the same direction? Remember, you can’t manage what you don’t measure.
I RESOLVE to take a CPT coding class Most of your revenues are coming from fixed fee payers (Medicare, managed care, etc.). Your services are paid based on specific reimbursement rates for each service by each payer. In this environment, proper CPT coding can either lead to increased revenue or lost revenue. Take a coding class to make sure you are billing out all services that you are entitled to bill out and to make sure you are properly billing out your services.
I RESOLVE to take a proactive managed care stance Conduct a detailed review all of your current managed care relationships to assess what payers need to be eliminated and what contracts need to be renegotiated. I’m sure as you’re reading this you are saying to yourself that there is no way you can successfully renegotiate a contract. My response to you is: How do you know unless YOU TRY. Just talking with your managed care payers can provide valuable insight on what it takes to be successful in today’s dominate managed care marketplace.
I RESOLVE to get an independent review of my medical practice You get your car tuned up every year; doesn’t it make sense to get your medical practice tuned up also? An independent assessment will tell you what is good about your practice and what needs to be improved for increased efficiency and profitability.
I RESOLVE to start my own personal financial planning This includes retirement planning, education planning, budgeting, insurance planning, investment planning, and net worth optimization, just to name a few. As a practitioner who has been working solely with physicians for the last 20 years, let me tell you one simple truth: There are a lot of physicians out there who have to work. Don’t become one of them.
I RESOLVE to hold a strategic planning retreat this year This even applies to solo practitioners. Do you know where you want to be 3, 5, 10 years from now? Do you have a plan on how to get there? Are all physicians in agreement on how to get there? It shouldn’t take a rocket scientist to figure out that future success requires an awful lot of planning.
I RESOLVE to consider a practice merger Consider a practice merger to eliminate duplicate overhead, to increase revenue, to possibly gain some leverage over the managed care payers, and to provide a transition strategy. These are just a few of the potential benefits. If done right, a practice merger can not only increase physician incomes, but maintain some of the autonomy most physician’s desire.
Finally, I RESOLVE to hire the best people Again, I want to emphasize the simple and honest fact that the better performing practices out there are the ones doing the best job at human resources. One way they do this is by hiring the best people they can, even if it costs a little more to do so. This means strict attention must be paid to the hiring process. It is so easy to see how hiring really good people can turbo charge a practice almost overnight.
Reed Tinsley, CPA is a Houston-based CPA, Certified Valuation Analyst, and Certified Healthcare Business Consultant. He works closely with physicians, medical groups, and other healthcare entities with managed care contracting issues, operational and financial management, strategic planning, and growth strategies. His entire practice is concentrated in the health care industry. Please visit www.rtacpa.com