Finance & Enjoyment Blog

Tips to Increase Medical Practice Profits

We all know that we are living in a day and age where healthcare provider reimbursements are declining while costs continue to rise. This combines to eat away at your net income and your medical practice profits. We know it is hard to keep an eye some of the financial basics when you have a practice to run and patients to treat. So, as your Denver CPA, we have put together some tips we have found that will hopefully help you increase your medical practice profits.

Work in One More Patient Daily

We know that reimbursement for an additional patient is almost pure profit as most expenses have been paid for. We suggest checking your performance against reports from MGMA.com and NSCHB.org. If you find that you are in the 50th percentile of productivity, make it your goal to move into the 75th percentile in the next year.

Take an ICD/CPT Coding Class

Coding improperly, in particular, under-coding, is among the top reasons medical practices lose money. Correct coding can result in pure profit as overhead has been paid and increased reimbursement falls straight to profit. You should get proficient in coding in your specialty and keep an eye out for the IDC-10 to see if it is delayed. If it goes live, come September there will likely be many additional coding classes offered to get you ready for year end.

Drop Lowest Reimbursing Insurance

If you are overwhelmed with patients and the community is under-served in your specialty, it could be a good idea to consider dropping your worst reimbursing insurance plans. This is also a good idea if you are closed to new patients more than 50 percent of the time. Keep doing this until your wait list is under two weeks in order that you can adequately serve patients that you have accepted. The patients with dropped plans can still see you as “out of network” and pay for service at the time of their appointment and submit a claim for reimbursement. This makes them your best paying patients! For example, with these patients now paying an extra $20 copay per visit at two appointments a year can add up to $40,000 in medical practice profit if you have 1,000 out of network patients.

Add an Assistant Physician

If you have a long waiting list, perhaps over two weeks, it can be a good idea to add an assistant physician or nurse practitioner. These positions get reimbursed at the same rate, but are at half the costs or even less. Some practices, if they are able to keep assistants busy, can see typical profits of at least $50,000. If need be, you can expand hours to accommodate assistant physicians.

Purchase Supplies Online

Typically supplies on line are cheaper, plus it requires less staff labor to process and item selection is easier to control. Also, many medical associations offer group purchasing at a discount with big vendors that can help you save thousands of dollars per year.

How to Use this Information

While the above are some general tips we found that help practices increase profits, we encourage you to run these by consultants dedicated to your practice's specialty. They can recommend other ways to help your practice succeed. At KKB, P.C., we are here to help with practice consulting whether it is financial management, physician compensation planning and more. Call us at 303-815-1100 or contact us online today!

What are some tips you have found that have helped increase your practice’s profit?


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