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How to Tell if Your Medical Practice is Well-Managed

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What are the hallmarks of a well-managed practice?  There are many, but here are 10 basics.

  1. The practice has foundation documents appropriate to the corporate structure and written agreements describing how income and expenses are shared by physicians and/or other providers and how partners enter and exit the practice. The owners of the practice and management meet monthly.
  2. The practice has documents that set the guidelines for operations such as a compliance plan, disaster plan, personnel handbook, job descriptions and requirements for annual evaluations, raises, bonuses and progressive discipline. Management and staff meet monthly.
  3. The net collection percentage is 95% or more. This means that of the expected collectible dollars, 95% is collected.
  4. The practice has a budget and variances are addressed.
  5. The unfilled appointment percentage is 5% or less. This is in retrospect, so it includes no-shows. The practice has a marketing budget and a written marketing plan.
  6. The practice has a line of credit or other means to draw upon in the case of unexpected cash flow drop.
  7. A single commercial payer comprises no more than 50% of the practice business.
  8. Employee turnover rate is 10% or less. New employees are onboarded with training, coaching and competency testing.
  9. The practice has the ability to produce management reports to track and trend production, payments, adjustments, and denials. Process Improvement (PI) is used to address negative trends.
  10. Patient satisfaction is prioritized and measured, and improvement is valued.

What other hallmarks would you add?

Posted in: A Career in Practice Management, Collections, Billing & Coding, Day-to-Day Operations, Finance

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