This Business Solutions episode of the Insights podcast features Maberly Brown, senior revenue cycle consultant and Marvin Luz, senior director, revenue advisory services both of Greenway Health.
Brown and Luz discuss the business of healthcare and the power of KPIs.
Editor's note: The following Q&A has been edited for length and clarity.
Q: What's a win that you’re seeing in the industry right now?
Luz: What we’re seeing in the industry right now is higher deductible plans, which means a higher responsibility on patients. And something that I think is a positive is (our) clients are now engaging patients in new ways that helps lower their AR. So, something that I think is definitely a win is how technology is being embraced in order to be more active and proactive with patients.
Q: On the flip-side, what’s an aspect of the industry that you’re concerned about?
Brown: Unfortunately, I don’t think that physician and employee burnout is ending anytime soon. It’s becoming more difficult to find qualified professionals to deliver healthcare, and then (it’s the same way with) the administrators in the practice. To really set forward good policy, procedure, financial best practices - it’s very expensive to do that, especially when we look at reimbursement and shrinking margins inside of the practice.
Q: What KPIs do you look to when you’re working on improving the practice?
Luz: I look at my trifecta of KPIs from a revenue cycle management perspective. One is days in AR: how healthy is your AR sitting there? The other is also clean claims. And then, we put a positive spin in our organization of looking at your AR aging in your 0-60 aging buckets; how high is that aging in those two aging buckets? So having a focus on clean claim, in my opinion, drives healthier results in your AR, lowering your days in AR, (and) improving the claims that are sitting in your open aging.
Brown: I like to start high, that 30,000-foot view. I am particularly passionate about net collections, so that is a great number to look at. And in the process of validating a net collections percentage, you're actually going to learn a lot about your people, your process, and your technology in validating that particular percentage point. So that gives you the opportunity to kind of get a little bit more in the weeds in that validation process. But that is where I like to start to look. Because if we've got a net collection that is 99.9%, in theory, you should have nothing in your AR that is over 120, for example.
Q: At MGMA, we live by the phrase “advancing the business of healthcare.” What can practices do to better their own businesses?
Brown: So I come from the view that when practices are starting out, or if you're working for a smaller organization, oftentimes, you are hyper-focused on, for example, closing month end. And in order to do that activity, you're going to be looking at your data through one lens, typically a payment post or a posting date. And that's great, you need to do that in order to complete that activity at the end of the month. If you want to go a little bit deeper and start to do analysis and understand where your practice sits, in general, you'd want to flex those reports and maybe look at them by service date, so that you can use that data. How are you from a posting date perspective? How are you doing from a service date perspective?
Luz: I come from the lens of understanding, what is the practice’s goal? Goals can be very different from practice to practice. From a solo practice, to multi-specialty, to multi-locations. What are the goals? What's driving that practice?
You have to understand thr metrics to understand, are you on target for your goals? A year goal looks very different than a six month-goal, looks very different than a five-year goal or a 10-year goal. … It's understanding those and then interpreting the data from the reports that you're getting.
Q: Can you talk about financial integrity and the role that it can play in a successful medical practice?
Brown: When a practice is ready to begin their financial integrity journey, the most important piece here is to look at your practice holistically. So having that 360-degree view of what is happening inside of your organization, and then pulling in those stakeholders from different departments so that you've got a cross-functional team that can help you develop a system of checks and balances, and then performance goals to get you moving forward is really where you need to start and focus when you're developing that integrity plan.
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The MGMA Insights podcasts are produced by Daniel Williams, Camille Burch, and Rob Ketcham.
MGMA Events: This episode is brought to you by the Medical Practice Excellence: Financial and Operations Conference 2023. During our premiere spring event, attendees will gain key insights from both disciplines and learn about topics that shape the future success of medical practice organizations. Go to mgma.com/mpe23 to learn more and to register today.
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