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Ophthalmic practice administrators know that keeping physicians happy is crucial to the practice's overall success. And the best way to do that is by making sure their incomes are continually growing.
Houston-Ophthalmic practice administrators know that keeping physicians happy is crucial to the practice's overall success.
"The physicians' calculations of what makes a practice successful, or not so successful, is really determined in their salary calculations," said Rick Canady, executive administrator of Houston Eye Associates (HEA). "Get their salaries up, and they'll be happy."
The average salary of HEA physicians has increased by 67% in the past 5 years, Canady added, and on most days they all leave at 5 p.m. "When they take those checks home to their spouses, the spouses are happy, so not only do they like me, the spouses like me, too," he said.
"Raise revenues, decrease expenses, and you're going to have success," Canady said. He offered tips for accomplishing both. One of the easiest ways for practices to grow revenues, he advised, is to see on which of its procedures managed-care payers are paying 100%. That is often an indication that the practice can charge more for it.
"I can guarantee that your practice is leaving money on the table, because managed care would pay more than what you are charging," he said.
HEA brought in about $1 million by doing this.
"There wasn't anything extra we had to do to generate it. It's like free money," he said.
Practices are sometimes reluctant to raise charges to avoid causing hardships to people without managed care. A way around that is to offer a discount to people without insurance who pay right away.
"You don't have to penalize people, but don't leave money on the table," he urged.
Automate billings and payments
Automating the billing and payment processes is another effective method for increasing revenue at little cost. With correct pre-certifications, co-pays, and deductibles, practices can expect to automate about 85% of their collections. This improves cash flow and reduces collection workload for the practice's staff.
When unpaid billings are turned over to a collections agency, the benchmark for collection should be 10% to 15%.
"If they're collecting more than 15% your business office is turning over accounts that are good. If collections are getting under 10% your office is sitting on them for too long," he said.
Bringing down the rate of no-shows is yet another inexpensive way of raising a practice's income. Some practices deal with the problem by charging fees. HEA has reduced theirs with an automated calling system to remind patients of appointments. Those not reached through the system get a follow-up call from a staff member. The result has been a 20% decrease in no-shows. However the practice addresses the problem, Canady cautioned, it is important to measure the no-show rate first to know whether efforts to reduce it are working.