The easiest way to improve how you manage your practice is to improve how you measure it. If you are collecting key data and using actionable reports, you will see areas where your practice can improve efficiency and increase profits.
It is impossible to optimize your practice without regular and accurate analytics. The best place to start this process is by outlining a plan that includes identifying your practice’s key performance indicators (KPIs).
The easiest way for your practice to identify its KPIs is to select the most critical factors for practice success. For most physician practices, assessing the revenue cycle is a great place to start — and can yield huge results.
However, no matter what area you choose to start with, you’ll need to consider these steps to improve performance:
Set goals – Define your desired outcome, whether it’s increased collections, improved patient care or practice expansion.
Recognize data sources – You’ll need historical practice data, industry benchmarks and comprehensive ongoing reporting. Your practice management system should provide easy-to-use, real-time reporting to make this step easier.
Define KPIs – Select the essential indicators you want to track to determine how you will measure your practice’s success.
Discover opportunities – Defining your KPIs and analyzing data will present opportunities for your practice to improve operations and revenue.
Continue to improve – Constantly identifying new areas of your practice to optimize will lead to a happy staff, increased profitability and a successful practice.
Data is the most powerful tool your practice has to maximize its potential. Your practice management system should make it simple to utilize this information to define your KPIs and implement positive change.
If you need ideas to get started, the MGMA recommends three areas of KPIs for non-hospital-owned medical groups:
- Median total accounts receivable per Full-time equivalent (FTE) physician
- Median percentage of total accounts receivable 120+ days old
- Median days gross fee-for-service charges in accounts receivable
- Median adjusted fee-for-service collection percent
- Median total medical revenue per FTE physician
- Median total operating cost per FTE physician
- Median total medical revenue after operating cost per FTE physician
- Median total medical revenue after operating cost and non-physician provider cost per FTE physician
- Median total operating cost as a percent of total medical revenue
Don’t let critical data lie dormant; put it to use and watch your practice’s profits go through the roof.
What are your practice’s key performance indicators? Let us know.