The challenges to sustaining a successful medical practice are numerous—declining reimbursements, government regulations, and third-party interference, among others, all play a role. But even in the face of these obstacles, many practices continue to hold their own financially. When asked about the financial state of their practice as part of the Medical Economics 2019 Physician Report, 22 percent of respondents said their practice is doing better than a year ago, 52 percent are doing about the same, and 26 percent are doing worse.
So what makes the difference between a booming practice and one stuck in neutral, or worse? The majority of physicians doing better than the previous year attributed their success to seeing more patients, enabling them to increase revenue. Yet many physicians work long hours already and wonder how seeing more patients or making other operational changes is even possible.
As a starting point, physicians should figure out where their practice ranks compared to others of their size. “Look at the financials and benchmark them to get an idea whether you are performing as an average practice should,” says David Zetter, CHCC, CHBC, senior healthcare consultant for Mechanicsburg, Pa.-based Zetter Healthcare and member of the National Society of Healthcare Business Consultants (NSHBC). Look at the number of patients seen per day, the average reimbursement levels, and revenue per provider to figure out where the practice is lagging.
Once physicians know where to focus their efforts, financial improvements can often be generated by increasing staffing, improving productivity, embracing value-based care, or renegotiating payer contracts.
Add staff to increase patient capacity
Adding staff can increase patient capacity. And while it means higher operating costs, in many cases, the extra help pays for itself in multiple ways. Sterling Ransone, MD, FAAFP, a family physician in Deltaville, Va., had reached a point where he couldn’t see any more patients in a day. When he couldn’t find another physician willing to relocate to the area, he opted to hire a nurse practitioner instead. Now, he is able to focus on more of the chronically ill patients who require complex care.
“For us, it was mainly about capacity, because when we didn’t have [a nurse practitioner], we were super busy,” says Ransone, whose wife is also a physician in the practice. “Part of the benefit to me is knowing that patients get to see someone and that I’ll be involved in the mix for their care. It’s been well worth it to my personal bottom line.”
This includes the benefit of having more time with his family during non-business hours. “In the early years, I took calls 24/7,” he says. “Once we started hiring midlevels, they could take some of the calls for us, freeing us to travel with our kids or be places the phone doesn’t reach.”
Similarly, Marc Price, DO, a primary care physician practicing in Malta, N.Y., found that whenever he took time away from the office, he was losing money because there was no patient revenue being generated. Adding a non-physician provider has helped with office efficiency and finances, even though those weren’t the only reasons he made the hire.
“I hired one not specifically for revenue, but more for lifestyle and service to patients,” says Price. “When it comes to income, they make more than what you pay them.”
Price says the physician assistant helps him keep up with patient messaging, prescription refills, lab reports, and other administrative duties, freeing up more of his time to spend with patients.
Another staff addition that can pay for itself is a scribe. Ransone has been using one for 15 years, and says he went from averaging about 20 patients per day to 23-24, with between 22 and 23 being the break-even point on cost.
“The length of time required for any one patient was shortened and all the extraneous computer stuff was being done by someone else,” says Ransone. “I could get in more patients and wasn’t spending all my time following up on referrals and other administrative tasks. It’s been as good for my patients as it has been for my sanity.”
Larry Brooks, AIA, principal of Practice Flow Solutions in Roswell, Ga., and member of NSHBC, says that patients want an efficient visit, and a scribe helps accomplish that not only in reduced wait times, but also in patient satisfaction.
“Using a scribe, a doctor can spend eight to 10 minutes with eye contact,” says Brooks. “A patient feels a lot better about that than a 15-minute visit with the doctor looking at a computer one-third of the time.”