Practice Management Alert

Test your knowledge.  Determine how you would handle this situation before looking at the box below for the answer.
Question: I'm the billing manager for a 20-physician multispecialty practice. One doctor asks me constantly how his billing is doing and what his collections are. What should I do to answer his questions?

New Jersey Subscriber

    Answer: Although you should applaud the physician who is taking an interest in the business side of the practice, it's impractical and inefficient for you and your billing staff to stop everything you're doing to run reports for this doctor whenever he asks. Instead, work with the practice administrator and the managing physicians in your practice to develop a policy on when and how to issue financial reports to the providers. In a practice as large as yours, it may be appropriate for you, as the billing manager, to suggest to the practice administrator a policy on financial reporting. The administrator would bring the issue to the managing physicians.
 
Financial reporting to physicians can be done monthly, weekly or daily. When drafting your policy, however, be careful about suggesting time periods that are too short and may distort the numbers. For example, one physician performs several surgeries in a week, or sees an unusually high number of patients in a day. As a result, the charges will be high in the time period measured. Maybe in that particular period, the practice didn't happen to receive many payments. When the report presents the collection rate for the week or day, and compares it to charges, the net collection rate will be low. If you present the data over a month, it's likely to be more accurate and present a truer picture of the physician's financial performance.
 
The information in these financial reports will depend on what data the practice determines would be useful to physicians and what your accounts receivable (A/R) computer software can track and produce. Generally, these reports include charges; the number of procedures, visits, or services rendered by CPT code; collections; and the number of days and dollars in A/R. You might give the doctors the gross charges and total collections. Or, you might provide total payments, and what the adjustments were under contracts with various insurers. If your software can't produce a collection rate, you may have to calculate that manually. Make sure your practice determines whether a gross collection rate or a net collection rate is most useful to the physicians. For example, with a gross collection rate, you may charge $100 for services, and Medicare pays you $80, producing a gross collection rate of 80 percent. But, when you take the Medicare adjustment into account and recognize that the most it will pay [...]