Cardiology Coding Alert

Make sure you run specific financial reports.

Patient care is, of course, the main priority of any healthcare institution; but to continue providing stellar care for patients, you must keep your practice in tip-top shape financially. To do this, physicians should understand what’s happening with their finances.

“The more the physician knows about the financial health of the practice, the better they will be,” said Karen Bowman, FACMPE, CPC, CPMA, in a session at AAPC’s 2024 HEALTHCON.

Read on to learn more advice about how you can boost financial literacy in your practice.

Tip 1: Remember These Strategies

Before you can present a physician with the numbers, you need to gather the financial information. There are some tricks you can use to simplify the data collection, Bowman said:

• Make sure you have accurate insurance fee schedules integrated into your practice management system.
• Provide front office staff with fee schedules to make sure they’re collecting the correct payments.
• Require patients to pay copays, coinsurance, deductibles, and any patient balances at the time of service, and if you have surgical patients, collect those payments before the surgery.

Staying on top of your practice’s finances is a key way to boost your financial literacy and know what’s going on. Make sure you’re involving physicians — whose services bring in most of the money to a practice — in discussions and updates about the financial health of the practice, even if the physicians you work with care more about medicine than business. You don’t need to ask them to hang up their white coats for custom suits, but there are some strategies to bring them deeper into the financial fold.

Bowman suggests these three tips:

• Provide monthly dashboard reports to the physician.
• Schedule monthly meetings to go over dashboard reports.
• Ensure the physician understands all reports.

Tip 2: Get Into the Financial Nitty-Gritty

In terms of finances, “You need to measure it to understand it and understand it to measure it,” Bowman said.

Some of the key indicators of your practice’s accounts receivable (A/R) are evident in certain values: the days “in” A/R, gross and net collection rates, claim denial rates, bad debt ratio, and posting lag. There may be some simple explanations for some of the values. For example, bad debt may come from patients who are self-paying, and posting lag may be due to a coder or biller being on vacation and work just not getting done.

Here are some of the reports you can run through your office’s practice management software to better understand the numbers, Bowman says:

• End-of-month reports with gross collection, gross payments, and adjustments
• Procedure productivity and transaction analysis reports
• Denied claims report
• Referring physician report
• No-show report to track office visits and surgeries
• Appointment lag report to track new and established patient visits

Having this information at hand can make your communication with physicians easier because you have actual data with which to answer their questions.

“When you have that physician say, ‘Why are my numbers down?’ ‘Well, you took three days off, and there were two holidays.’ That makes a big difference, right?” Bowman said.

As for the reports, there is flexibility in what you look at, but think of each report as a perspective, and try to get as many perspectives as you can.

“You all can do it any way you want to do it, and you’re probably doing it right now,” Bowman said. At the practice where she works, they “look at total, patient charges, and the number of visits that we have, and that could include surgical visits and [evaluation and management] E/M visits and everything, the gross charges, the total payments, and total adjustments. Look at your bad debt ratio, too,” Bowman said.

Once you have all of these numbers in hand, you still need to know how to extract meaning from them. Here are some of the important equations that will help you understand how your practice is actually doing on the financial front: