Reed Tinsley, CPA

Retaining Key Employees in Your Medical Practice

Many medical practices are you tired of losing good employees to the competition? They are looking for ways to stop the revolving door of hiring one good employee only to have two others resign? As health care organizations strive to deliver quality health care, retaining key employees is an ongoing concern. Employers can begin to address the growing concern of how to retain good employees by asking employees, “What makes for a good place to work?”

A study conducted by the Gallop Corporation found the top responses to be:

 Having the opportunity to do what I do best.
 Having the sense that someone cares about me.
 Knowing what’s expected of me.
 Getting recognition for what I do.
 Having opportunities to learn and grow.
 Being productive.

A common thread runs through these responses — effective performance management. Physician practice managers do not intentionally ignore employees’ needs for recognition and professional development. Usually absent are both a system and accountability for ensuring employees understand expectations, receive feedback about their performance, receive recognition for good performance, and have a plan for professional growth and development.

Take a look at your 90+ old receivables category

A good indicator of how well the office is collecting its accounts is the percentage of receivables that is more than 90 days old. If the percentage is unusually high, something is wrong in the office. Again, a high percentage could be traced to a systems problem, a people problem, or a combination of both. A good benchmark for most medical practices is to keep receivables more than 90 days old at less than 15 to 20 percent of the total amount of accounts receivable. A good specific benchmark would be that no more than 18 percent of the accounts receivable should ever be 90 days or older. Medical practice statistical surveys, such as the one produced by the Medical Group Management Association, could be used for comparison.

Are you using your PM system to its full capabilities?

We all know how important efficiency is to any medical practice, especially its billing and collection functions. To maximize your billing and collection processes, you need to dig deeper into your practice management system’s features. Think about the things that require manual steps to track and accomplish with the current practice management system. Make a checklist. It could be anything from eligibility and verifying benefits to patient reminders and dunning messages placed on patient statements, or it might be automated collection letters and re-set reminders on outstanding claims. Perhaps it is electronic remittances or the ability to sort data and provide meaningful management reports that are laborious to obtain manually. Another important feature is the ability to identify incorrect payer reimbursements.

These are features you should expect from a good practice management system, along with ease of use, accuracy and reliability across the board. If the vendor tells you theses feature are in research and development, it may be a long wait and time is not on your side. Regardless, you need to know if there is an opportunity to get more out of the current system and your vendor is the one to tell you. With the cost of running a medical practice, efficiency and reliability of the practice management’s system is vital to your future.

If you discover there are available system features the practice hasn’t tapped into, work with the vendor on how to get the staff trained and up to speed. I find many medical practices are not using their practice management system to its full capabilities. Don't let this happen to you.

The Importance of a Recall System for Physician Practices

Medical practices can run a serious risk if its patients are not recalled for follow-up as required by medical protocols and just as important, also lose revenues. Practices can easily develop a recall system using their own computer system. This type of system should ensure that patients will not “fall through the cracks.” Recalling patients for follow-up attention is more than just good marketing. It's an essential aspect of good medical care. In fact, a practice could be courting trouble with a potential malprac¬tice issue if it does not bring certain patients back.

For instance, take a gastroenterologist who has seen a patient with early indications of potentially cancerous polyps. Professional protocols call for re-examination on a regular basis. If the patient ends up dying of colon cancer, an effective malpractice attorney is going to wonder and ask if the gastroenterologist had recalled the patient as the pro¬tocols require.

Many practices have a very simple recall system. This is when the receptionist pulls the charts of patients he or she had listed for recall when they checked out from their prior visits. But the receptionist, in a busy front office, often misses some names and never check to see if the people ac¬tually recalled made and kept their appointments. Worse yet, the system would probably collapse if the receptionist ever quits.

A practice’s computer billing system is the logical device for highly effective patient recall. When the physician marks “months," or "one year" on the patient's fee slip, for example, the instruction can be punched into the computer system along with the fee for the current visit. Having a set of codes for "reason for recall" (such as to recheck polyps) allows storing the reason until the patient is actually re-contacted.

A practice’s system should then be able to automatically print out recall letters a month before the visits are due. Those letters may include pre-drafted sentences or paragraphs, keyed to your "reason for recall" codes, telling the patient why the visit is important to his or her health. The system should also print out a list of patients to be recalled so your staff can check them off as they are actually scheduled and seen.

Some computer systems can automatically check off the recall patients as they are later billed for their visits. It can then generate a list of patients who have not responded to the recall and who should thus be followed up further. If appropriate, the practice should send a final warning letter, retaining a copy in the chart, to each patient who fails or refuses to honor the recall effort. The computer should be able to generate this final letter as well.

An effective recall system can be handled by most medical software systems. If a practice’s system cannot handle this, make sure at least a manual recall system is in place and is being implemented properly. Whether to provider a better service, to avoid potential liability or to increase practice income, a recall system is too important to be left ignored.

Dear Physicians - Start paying attention to your practice

Does this scenario sound familiar: Medical practices delegates all oversight, supervision, and daily office management to the practice administrator yet only to find out later that things are REALLY screwed up? I recently saw this again at a large specialy practice and the situation was familiar to those in the past - the doctors just wanted to practice medicine and leave everything else to the administrator.

This just can't happen; physicians need to realize that a medical practice IS THEIR medical practice and as such need to take ownership of it. To avoid such instances from happening, a physician or physician group should do these things:

1. Have a monthly financial meeting. Review the finances of the practice and engage a formal agenda to review and discuss all other practice issues;

2. Implement checks and balances. Make sure your CPA is looking at your finances on an ongoing basis and is asked to attend your monthly financial meetings;

3. If large enough, implement physician committees. This will keep physicians involved;

4. Survey the employee group. Employees see what is going on each and every day - get their feedback on how the office is running, how they are being treated, and ideas to improve the office.

Office manager embezzles from Texas physician office

In Texas, a 28-year-old woman has been charged with felony theft after police say she stole nearly $60,000 over several months at the doctor’s office where she was once employed as its office manager.

According to the arrest affidavit, the office manager between May 2010 and Nov. 2011 used a credit card meant for medical practice purchases on personal expenses, racking up about $16,000 in charges, the affidavit said. The abuse of the credit card was discovered in November, and the office manager was immediately fired, the affidavit said.

When a new office manager took over, she discovered the fired office manager siphoned money from the paychecks of a doctor and three employees intended for 401(k) retirement accounts. Those thefts totaled over $40,000. The physician owner repaid the employees’ 401(k) funds out of his own pocket.

My question to you is: How good are your internal controls? I believe there is a lot of embezzling going on within physician practices and it's not getting caught.

National Practitioner Data Bank reporting requirements

The National Practitioner Data Bank (NPDB) is an electronic repository of all payments made on behalf of physicians in connection with medical liability settlements or judgments as well as adverse peer review actions against licenses, clinical privileges, and professional society memberships of physicians and other health care practitioners.

The NPDB collects and disseminates certain information, including:

- Professional liability payments made on behalf of a physician or other health care practitioners.

- Adverse action reports based on a physician or other health care practitioner’s professional competence or conduct that adversely affects privileges for more than 30 days. These actions include reducing, restricting, suspending, revoking, or denying privileges, and also include an entity's decision not to renew a physician's or other health care professional’s privileges if the decision was based on competence or professional misconduct. It also includes voluntary surrender of license or restriction of privileges either while under investigation or in lieu of an investigation.

- Voluntary surrenders relating to retirement, nonpayment of licensure renewal fees, and change to inactive status, if there is not an investigation in progress, are not reportable.

- Disciplinary actions related to competence or professional misconduct taken against a physician's license, including revocation, suspension, censure, reprimand, probation, and licensure surrender.

- Professional society review actions taken for reasons related to competence or professional misconduct that adversely affect membership in the professional society.

- Medicare and Medicaid exclusion reports containing sanctions against a practitioner from the Medicare program or the Medicaid program due to fraud and abuse.

A complete list of reportable information is maintained in the NPDB.

http://www.ama-assn.org/resources/doc/washington/npdb-hipdb-comparison-chart.pdf

Any quick and simple way to reduce payment denials?

Consider the following:

1. Flag all denied charges, usually my making a copy of the related EOBs and placing them in a manilla folder.

2. Hold a staff meeting of the billing and collection personnel either twice a month or at a minimum, once a month. You should discuss these denials, why they occurred, and how to make sure they don’t happen in the future.

3. Communicate the resolutions to the appropriate individuals. This could include front desk personnel and even the physicians. For example, maybe a denial is occurring because the physician is filling out the patient charge ticket incorrectly

Don't Ignore These Special Insurance Coverages For Your Medical Practice

These five comparatively unknown insurance coverages can save you thousands (or more) of dollars. And they aren't very expensive.

Almost everyone recognizes the need for certain basic kinds of insurance protection like automobile, fire and malpractice. Many doctors, though, overlook other coverages that may be just as important. Here are five kinds you should check.

1. Accounts Receivable Insurance. This is basically fire insurance extending to the value of your receivables. If a fire wipes out your financial ledger cards or your computer data (unless you have back-up stored elsewhere), the coverage is a godsend.

2. Business Interruption Policy. Basic fire insurance does not compensate you for lost income after a burnout leaves you with no office in which to practice. We know doctors who were financially rescued by a special business interruption policy covering this loss until they could work in temporary quarters.

3. Non-Owner Auto Coverage. When a staff member drives a personal car on practice business to the hospital, for instance you may be liable for any damages suffered in an accident. With an inexpensive rider to your auto or general liability policy your
practice can avoid potentially huge losses above your employee's personal auto coverage.

4. Excess Liability Policy. Most auto home-owners and office liability policies have a maximum exposure of $100,000 or $200,000 per incident. Lawsuits these days often involve claims running into seven digits. A relatively inexpensive "umbrella" policy adds
$1,000,000, $2,000,000 or more of protection on top of your normal policies.

5. Fidelity Bond. Embezzlement occurs far more often than doctors like to believe. If it happens to you, the odds of recovering upon discovery are slim. A fidelity bond covering employees handling finances helps you recoup the loss. It's also helpful because the insurer handles dealing with the wrongdoer.

It doesn't become A/R if you collect it at the front desk

Remember it never gets to be a receivable if you collect it at the time of service. I wonder how many physician practices realize the real true "cost" it takes to collect these often small balances? In any event, quantify the percentage of office visits where a collection at the front desk takes place. Is it acceptable? If not, try the following:

Does the patient know your collection policy? Develop a financial policy to distribute to patients when they arrive; make it available on your website, too. Hang tasteful but clear signage in the front office. Don’t beat around the bush by printing signs that say, “Our Practice Expects You to Pay Your Copayment.” Instead, be direct with signs that read, “Your Insurance Company Requires You to Pay Your Copayment.” Send the message professionally, but make it clear that you expect to receive payment at the time of service.

Train front desk staff on how to ask. There is an art to collections, and a large part is knowing how to ask for money. Instruct your staff to stop asking patients, “Would you like to pay?” Replace that request with “How would you like to pay today?” As they ask for payment, staff must make eye contact with the patient (or guarantor) and use his/her name during the conversation. Writing out the receipt while asking the question is a great tactic because it sends the message to patients that your practice expects payment.

Accept all forms of payment. Allow patients to pay by cash, debit or credit card. Personal checks could be an option, but consider using a check verification service if you encounter bad checks – those with insufficient funds. Look at the commission rates on credit card services to make sure you get the best deal possible from card merchants. Don’t hesitate to steer your patients to a particular form of payment. For example, you might get a better rate when patients use debit cards for amounts under $20, but a more favorable rate when patients use credit cards for amounts over $20. Of course, you should not hesitate to accept any form of payment, but it doesn’t hurt to request a particular type of payment depending on which is more advantageous to you. Most patients won’t care one way or another because it is you, not they, who sees the commission going to the card processing company.

Look in to pre-authorized credit cards. Pre-authorized cards allow you to accept pre-payments via credit card without encountering the hassle and danger of storing the patient’s credit card information. These systems capture and store credit card information for you to use later when the claim has been adjudicated. These systems also allow you to set up payment plans securely and seamlessly.

Determine what to ask for. If you have a contract with an insurance company, review it to determine whether you can request the payment of the coinsurance and unmet deductible at the time of service – most likely you can. Despite the well-entrenched urban myth that circulates in the medical practice industry, most insurers do allow you to collect the patient’s coinsurance and unmet deductible at the time of service. Once you’ve identified any exceptions, ask for patient for these payments at the time of service. For coinsurance and unmet deductibles, you’ll need to know what services the patient is receiving (because allowances are based on CPT® codes). Thus, you’ll need to perform this collection activity as patients check out of your practice. Some insurers offer a web-based look-up tool to locate the correct rate. There also are software vendors specializing in contract management that can deliver this information to your staff. Alternatively, develop a spreadsheet that lists your top CPT® codes and the corresponding allowances for each code by each of your major payers. Train your check-out staff to look up the codes on this spreadsheet.

Collect a deposit from the uninsured. For patients who do not carry insurance, request a minimum deposit. Set the “deposit” as your full charge, a reduced flat rate, or an average of the copayment that would be expected of your commercially insured patients. You may choose to collect different deposit amounts from new patients versus established patients (typically, deposits required of new patients are higher because there is no relationship or history with your practice), but be consistent within the categories. For patients who can’t afford to pay, offer a financial hardship policy that grants discounts based on the level of hardship. The key to making this work is to take a consistent approach to charging deposits – and have a written hardship policy that you follow consistently.

Collect that A/R balance too. Time-of-service collections include the amount owed for that particular visit – and that which is outstanding from a prior encounter. Don’t hold yourself to collecting past-due balances – ask for all balances, regardless of age. Print a statement for all patients at check out that reflects any payments they have made as well as the balance due. Giving these statements to patients at check-out is not only free (other than the cost of the paper), but it reinforces to them your expectations of getting paid. It also eliminates the excuse patients so often give to your business office: “I never received a statement.”