“In healthcare you have to get bigger to survive.”
This was a direct quote from a doctor with Middle Tennessee Emergency Physicians group evaluating whether or not to consolidate with a larger staffing company.
According to this same article featured in ModernHealthcare.com, the majority of hospitals within the U.S. remained staffed by independent physicians groups just like Middle Tennessee. So, why are so many practices considering consolidation, or worse, failing, and what can be done to fix them?
The trials that come with running a practice can seem to be too much to overcome in some cases, unless a practice has the right resources available to them. Here are some specific reasons emergency groups fail, and realistic solutions to avoid their demise.
Why Independent Emergency Groups Fail & What Are The (Realistic) Fixes?
Maintaining an independent democratic group is not an easy task nowadays. On the healthcare side, we are challenged with a rapidly aging population and increased cases of complex, or seriously ill patients. Additional factors include demands of performance for time-stamped metrics and solid patient satisfaction scores from the hospitals that hold your contract.
On the financial side, we are faced with increasing costs, decreasing reimbursements, and no opportunities for expanding new sources of revenue.
Reporting And Analytics Lacks Clarity In The Numbers
Reporting and analytics is a key component of operating a sound emergency department (ED) and independent group practice. As with any process, you have to measure the outcomes in order to be successful. You have to know what’s working and more importantly, what’s not working – this allows you to course-correct and fix any shortfalls the data may uncover. This is important from both a group financial and hospital partnership point of view.
The FIX: monitoring measures such as the following can be imperative to a practice’s success:
- Visit Count
- Procedure Count
- Accounts Receivable
- Receipts Per Patient
- Turnaround Times
Our advice for using reporting and analytical data to your advantage starts with an understanding of your practice data and evaluating scenarios where it might change. Next, identify trends that affect your overall numbers, then pinpoint areas for improvement as well as revenue-loss. When you use the above data to make business decisions you increase the likelihood your practice will grow.
Coding Mishaps Create Short And Long-Term Problems
Incorrect coding can have some short-term and very long-term effects on a practice’s success. Practices who employ over-coding measures can take advantage of increased collections on the front end. In the long-run, however, they will begin to see the negative effects, should an audit come into play.
The FIX: If all emergency medicine billing and coding are handled in-house, strengthen your team’s knowledge base to avoid falling down this very slippery slope. Furthermore, call in the assistance of an outside organization to audit the efficiency, compliance and productivity of your processes.
Financial Struggle Due To Complex Financial And Economic Variables
Let’s face it, staying ahead of the financial requirements of any business, be it small or large, can be a daunting task. Emergency medicine is no different, it can actually be more complex considering the seemingly insurmountable issues that come with the territory.
There are numerous sources where an ED can generate revenue, leaving potential problematic areas in each one of them. Insurance billing and direct billing are a couple of the obvious revenue sources whereas the expenses of the business are often hidden and add up quickly. ED’s spend a great deal of their revenues in areas such as labor costs, infrastructure, supplies, billing and other logistical areas.
Given that insurance and billing are one of the primary areas that affect cash flow, it is easy to see why this area can result in financial challenges.
The FIX: create a rigid structure for your current financial operations. For every patient seen, there should be corresponding remittance for the services provided. To drill down further, denial management should be handled in this manner as well.
Should You Throw In The Towel On Your Democratic Emergency Department?
More often than not, practices succumb to these struggles and end up throwing in the towel by way of selling to a consolidator.
The benefits of getting acquired may seem attractive for physician groups; stable work hours, guaranteed income, and freedom from the challenges of marketing managing billing and coding.
Unfortunately, surrendering the ability to have distinct control over your professional and financial growth often ends in disappointment and regret.
But don’t worry, there is a FIX for that as well. To get help with these financial and coding challenges, contact DuvaSawko today.
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start an emergency department medical practice - 6 easy steps
start an emergency department medical practice – 6 easy steps