Managed Care Contract Negotiations
Apr 07

Six strategies to create a meaningful financial performance report

Contracting and financial managers must communicate their practice's performance by presenting data to a variety of audiences, including administrators, governing boards, and physicians. Following are some strategies for examining your data critically and selecting the appropriate vehicle for each report:

  1. Study your target audience. What is the group's level of experience? Do some have a financial reporting background? High-level reports, especially to physicians, should include only summary data that will engage them.
  2. Consider the purpose of your charts and graphs. Charts and graphs have only four valid purposes in a medical practice: to analyze, monitor, plan, or communicate.
  3. Look at the data critically. Often, physician practices must convey quantitative messages using multiple data sets, such as numbers of patients and procedures or charges, net revenue, and adjustments. The type of quantitative data generally dictates whether a chart or a graph will be more useful.
  4. Select the appropriate vehicle for your message. Whether it be a chart, a graph, or a table, make sure you choose the appropriate design. For example, with graphs, a time-series design (e.g., each month during a 12-month period) could be used to illustrate appointment or collections data. Ranking designs are more appropriate for communicating best-to-worst performance, such as physician productivity by relative value units or revenues by location. With charts, use the same, easily readable font, such as Times New Roman or Arial, throughout the chart. White space adds to readability, especially when used to separate the data. Decimal points should always be aligned, and everything else should be justified
  5. Organize the data carefully. When designing charts and graphs for a medical practice, managers often neglect basic elements that can either enhance or weaken their presentations. For example, the number of data elements should be reduced to essentials, because a cluttered graph confuses the message.
  6. Use bar graphs for emphasis. Bar graphs can paint a compelling picture of a medical practice's financial results, but the design should follow the data. Although vertical bar graphs are more common, use a horizontal format for longer names or a large number of categories.
About Reed Tinsley, CPA

As a top advisor to physicians, I help increase practice profits by delivering hands-on, expert medical accounting/tax support, practice counsel, and revenue-building strategies. Read more →