Enhancing Services to New & Existing Physician Practices

1. Enhancing Services to New & Existing Physician Practices Reed Tinsley, CPA

2. Why I Don’t Like My CPA • Not enough attention • Doesn’t help me in my business • Brings few new ideas to my attention • NOTE: IT’S RARELY ABOUT PRICE IF THE VALUE IS THERE

3. How to Enhance Services • Add Value to Current Accounting & Tax Services • Develop Specialized Healthcare Services • Create Client Contact Program • Formal Management Meetings • Fixed Meeting Dates • Get In Front of the Client Often!!!!

4. Specialized Services to Consider • Contract Review • Practice Management Reporting • EOB Review • Billing/Collection Analysis • Accounts Receivable Review • Visit Coding Worksheet/Analysis • Managed Care Contract Negotiation • Physician Compensation

5. Specialized Services to Consider • Regulatory Review • Stark • OSHA • HIPAA • Strategic Planning • Practice Transition • Practice Valuation

6. Adding Value to Current Services

7. Practice Financial Statements • Why so Important and What to Look For • Balance Sheet • Aging of Accounts Payable • Excessive Non-Strategic Debt • Income Statement • Proper Presentations • Compare revenue to payments posted in billing system

8. Financial Statement Analysis • Financial Statement Review • Analyze overhead % of collections • Comparison to prior year • Must see comparative financials • First step: compare total overhead amounts • Line item overhead category analysis • Department overhead analysis

9. Comparison - % of Collections • Industry Benchmarks • MGMA • Medical Economics • National Society of Certified Healthcare Consultants • Other client practices in similar specialties

10. Comparison - % of Collections • Flaw in this Analysis • Assumes practice has maximized its collections • Assumes there has been no decrease in production/collections • Assumes a comparison of “apples to apples”

11. Provide Opportunities for Overhead Reduction

12. Payroll Costs • Analyze Total Personnel Needs • Too many or too few? • Analyze Actual Compensation Levels • Overpaying for specific positions? • How to handle long term employees • Analyze Overtime Pay • Exempt vs. non-exempt employees • What is causing excessive overtime?

13. Employee Benefits Analyze Health & Other Insurance Costs • Benefit coverage • Employee subsidy • Analyze Retirement Plan Costs • Hidden Costs • Vacation leave payouts • Sick leave payouts • PTO payouts

14. Supply Costs • Medical, Office, Drugs, etc. • Inventory control • Review Vendor Relationships and Pricing • Bid periodically • Centralized management • Use purchase order system • Utilize internet purchasing

15. Unique Cost Saving Strategies • Merging Medical Practices • MSO Formation/Utilization • IPA Formation • Adding a Physician • Changing the Physician Compensation Formula • Office Sharing with Another Practice • Implementation of EMR • Make Stakeholders out of the Employees

16. Help Build New Revenue Opportunities

17. How to Build Revenue – Generally • Adding Ancillary Services • Adding Non-Ancillary Services • Adding Physician Extenders • Adding Locations • Improving Practice Operations • Creating Alliances (Merger) • Research • Six Sigma – Practice Reengineering

18. How to Build Revenue – Generally • Renegotiate Managed Care Contracts • Implement EMR • Track Quality Measures • Have a Strict Recall Program • Pay Attention to Lower Portion of Referring Doctor Report • After Hours/Saturday Clinic • Surgery Center Development

19. How to Build Revenue – Generally • Do You Have a Practice That Patients WANT to Refer to? • Meet Human Resource Director at Largest Employers in Your Service Area • What Services Can You Provide On Site? • What are Educational Opportunities for Employee Group?

20. How to Build Revenue – Generally • Walking and Talking – Free Talks • Churches • Senior Centers/Assisted Living Facilities • Neighborhood Associations • Schools • Integrate Yourself with Hospital’s Marketing Program • Build a Public Relations Program

21. Review and Implementation Of Practice Internal Controls

22. The Front Desk

23. Billing/Collection The Business Office

24. Accounts Payable

25. Look for Signs of Financial Problems • Sudden Change in A/R Tendencies • Failing to Reach Benchmarks • Sudden Changes in Production by Doc • Escalating Overhead Costs • Doctors Holding Their Paychecks • Cannot Pay Vendors Timely • Borrowing Money

26. Are you taking care of the physician’s personal finances • Adequately insured • Asset protection • Retirement planning • Is a will in place • Estate planning • Building Net Worth

27. Example of Specialized Service PRACTICE MANAGEMENT REPORTING (You can’t manage what you don’t measure)

28. Concepts • Numbers Don’t Lie!!!! • Benchmarking • Only one benchmark that counts: Did the physician make more money this year than last year

29. Practice Management Reports • PMR • For the Practice • By Individual Physician • On a Comparative Basis • Clinical Activities Reports • Accounts Receivable Reports • Dashboard Indicator Report

30. The Numbers • Gross Collection Percentage • Net Collection Percentage • Days in A/R • A/R Ratio • A/R in excess of 90 days old • This year better than last year? • Clinical Encounters • Provider Work RVUs • Referring doctor trends

31. Organizations to Join • Medical Group Management Assn • www.mgma.com • American Health Lawyers Assn • www.healthlawyers.org

32. Healthcare Listservs • MGMA Discussion Groups • www.mgma.com • Part-B Listserv • www.partbnews.com • AHLA listservs

33. Keys to Success • Quit using the “I don’t have time” excuse • Make a commitment as a Firm • Stay very hands-on with your MD clients • Stay visible! • Work for free if you have to (to shorten the learning curve)

34. Questions and Answers Reed Tinsley, CPA, CVA, CFP, CHBC