The rise of managed care over the past decade or so has caused physicians to consider the need for better fiscal management. One common strategy is the creation of a sound business or strategic plan. Over my 25 years of financial and practice management I have determined that their are two types of physicians.
First, doctors who own their practice, kind of have a vision but waste a bunch of energy each day putting out fires and second, doctors who have abandoned a vision and either work for these same doctors I just mentioned, who by the way do not want to become partners, or those employed by HMO’s and more recently hospitals.
The goal for this discussion is to convince physicians to work on their practice and not in their practice, which can be accomplished by adopting a strategic business plan that will assist in creating a vision for your practice and yourself, hence assisting in increasing practice efficiency through an organized process and system that will be repeatable on a daily basis.
67% of physicians do not have a strategic business plan, according to Dick Hansen a principal with Medical Group Management Association. This leads to three questions physicians should be asking themselves in order to develop a vision and a road map for their practice:
- Where do you want to go?
- How will you get there?
- How will you monitor results?
According to Judy Capko, a Practice Management Consultant in Chicago, the top ten reasons why medical practices fail to maximize revenue are:
- Most office systems and procedures are weak
- Bills contain inaccurate and outdated codes
- Fee schedules are not updated
- Physicians miscode their level of services
- Accounts Receivables are not collected consistently
- Financial procedures are weak
- Staff are underutilized and ratio to physicians is low
- Physician productivity is not maximized
- Patient service is not top priority
- Practices do not have a business plan
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.