Monthly Archives: July 2012

Minimizing Accounts Receivable Days (AR Days) in a Pediatric Practice

July 20, 2012 in Billing and Collections by support Team  |  1 Comments

All practices have accounts receivables. There is a wide distribution of how efficiently Pediatric practices manage the revenue cycle to minimize the amount of revenue in accounts receivable. A common measure in the industry for benchmarking how well a practice manages the revenue cycle is Accounts Receivable Days or more commonly known as AR Days. What are AR days? Let’s look at an example. If a practice has an average of $100,000 in gross charges a month and currently has $200,000 in accounts receivable (waiting to be paid by insurance companies and patients), the practice has approximately 60 AR Days. All practices should continue to optimize their processes and systems until the practice consistently operates at less than 30 AR days.

There are many inefficiencies that slow down the revenue cycle for practices. For instance, some practices leave a copy of all their charges each week for a biller to ‘pick up’ then send to the insurance company. The biller/billing company then needs to enter these charges in their system, review and send to the clearing house. In some cases, at least two weeks pass prior to the claim being uploaded to the insurance company. I am aware of some hospital systems that wait to the end of the month to send all claims – what a wasteful practice! A strong Pediatric Billing company measures, monitors and benchmarks these processes and looks for ways to improve the AR days for the practice. This usually requires best practice sharing and routine evaluation of pain points in the revenue cycle. This is difficult for an average biller of a practice to do successfully due to their time and focus need to focus on the daily management of claims. Pediatric practices are dependent on the practices systems, processes and back-end billing team to minimize the AR days for the practice.

How Aligned are your consultants to the Goals of Your Pediatric Practice?

July 10, 2012 in EHR Selection by support Team  |  Comments Off on How Aligned are your consultants to the Goals of Your Pediatric Practice?

A Pediatric practice needs to successfully work with both internal and external stakeholders to be successful. These stakeholders include employees and external vendors/companies and sometimes, consultants. There can be misalignment of the goals of each of these stakeholders with the goals of your Pediatric Practice. There are a number of questions to ask a consultant to insure they represent your best interests.

Some of these questions could include:
-Is the consultant recommending a product or service due to an alliance with their firm or due to quality of the product for your practice? For instance, a company that sells servers will have a bias to recommend server E.H.R. systems due to their revenue being made based on providing advice and maintaining servers. If a consultant speaks at an event sponsored by a Vendor, this might indicate that there is a bias for this vendor. A question to ask: Is the speaking engagement with a particular vendor due to the vendor providing them customers that they can charge their consultant service and do they speak equally at events for all vendors in the same state (not just the ones that send them practices)?
-Having a consultant choose an E.H.R. service, could cause a Pediatric office to obtain an ‘old’ technology product or a product that does not appropriately balance the revenue/cost needs of the practice with the desire for a consultant to provide a service. Some consultants might not have the technical expertise to make the ‘right’ decision for your Pediatric Practice. Recommend asking any “E.H.R. consultant” how long they have managed a practice as well as their experiences with optimizing revenue for a practice (there are many with great experiences and unfortunately some with none to minimal experience). Equal time should be spent discussing the revenue cycle/practice management as well as clinical aspects of the E.H.R.. Consulting advice should look to optimize revenue, minimize burden, cost and start-up time. The practice is ‘on the hook’ for long-term operation of a system/process and the receiving end of decisions made regarding a system.
-Does this consultant make more or less money if the practice identifies a solution that requires minimal work on their part? Why would a consultant that charges by the hour (whether paid for by the practice or the government) seek a system that reduces billable hours? The long-term operational burdens are the responsibilities of the practice not a consultant.

Exceptional consultants with a solid history should be able to balance the needs of their clients with the need to optimize their own billable hours. Great consultants know and understand the revenue cycle and provide hints on how to reduce administrative burdens of Pediatric Practices. With all the conflicting priorities and needs of a Pediatric Practice, it is important for a practice owner to select the ‘best’ consultants/advisors for their particular needs.

The Cost of Maintaining a Server in a Pediatric Practice

July 2, 2012 in EHR Selection by support Team  |  Comments Off on The Cost of Maintaining a Server in a Pediatric Practice

I enjoy speaking with customers, potential customers, vendors and suppliers to obtain feedback as well as perspective. Recently, I was made aware of the actual costs that a practice incurs for appropriately maintaining a server. The ‘old’ method of establishing Electronic Health Records in an office was to install and operate a server with an internal network. Although this is still an option today, there are many expenses such as initial and continued operating costs that cloud computing provides a better choice. The winners of practices that choose client-server E.H.R. Systems are server companies, software companies that supply software for client-server applications and technology/server consultants that maintain servers.

I continue to be made aware by physicians of the cost of operating a server. The range in cost really concerns me and surprises me. For example, I know of a one-physician practice that was spending over $700/month just on an IT consultant to maintain his servers/network. When the Internet was ‘dial-up’ there was not another option for a physician practice. Businesses of all sizes began moving from client-server applications to cloud-based applications for many reasons. Some of these reasons include: most up to date software, lower operating costs and easier establishment of additional computers/users.

Evaluate the total cost of the option when deciding to choose client-server vs. cloud computing. Here are some items to obtain cost ranges when comparing a cloud-based option to a client server option:
-Cost of the servers, network gear and estimates of how often this equipment needs to be replaced.
-Cost of installing the network
-Cost of maintaining optimal up time of the network as well as maintenance
-Cost of software for the server (initial and yearly cost).

Consider conducting some ‘basic’ research by calling a local IT consultant to obtain a price quote. Also remember that you or an office manager will need to be the project manager/coordinator of the people and vendors once the practice decides to choose either cloud-based application or a server-based application. With a cloud-based application, the practice will need to maintain an internet connection as well as a wireless network. If there is not a person in the office whom is comfortable setting up a wireless network, usually a lower cost group such as the Geek Squad can set this up for the office. With a client-server application, the office will need to purchase servers, network gear, software for servers (in addition to their E.H.R. software) as well as incur an expert to install the system and maintain the system. The practice will also need to install battery back-up and a maintenance plan with all the components. These are examples of some of the hardware maintenance costs of a server.

There are many articles on the economic benefits of cloud-computing. For instance, see the April 30, 2012 article in Forbes Magazine titled “Cloud Could Cut $12 Billion from US Government Annual Deficit”. The study quoted in this article states that the US Government could reduce the annual IT Spend from about $80 B to $68 B. The winner would be the cloud-computing companies while other groups would either lose their contract or have reduction in services. Do not under estimate the amount of lobbying, PR and Marketing that the groups impacted by this migration to cloud computing will exhibit. Remember, the practice is ‘on the hook’ for the short term and long-term cost of a decision of client-server vs. cloud computing (not an external consultant whom might have minimal to no experience optimizing revenue for a practice). Internet speeds continue to increase dramatically which further enhances the positive aspects of cloud-computing.