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Practice Management


When you fear a discrimination suit, Dividing the income pie fairly, Who should pay to notify patients of a practice sale? How to track out-of-control supply costs


Practice Management

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Choose article section... When you fear a discrimination suit Who should pay to notify patients of a practice sale? How to track out-of-control supply costs Dividing the income pie fairly

When you fear a discrimination suit

QA woman I hired to cover for my lab technician, who's on a two-month maternity leave, is doing much better work than my regular staffer. I'd like to replace my regular lab tech with the temp, but since state law prohibits me from laying off a worker because of pregnancy, I'm afraid of a discrimination suit.

My state's labor relations board suggested that I tell the returning employee that if she doesn't improve in specific areas, she'll be dismissed. How much time should I give her to improve her performance?

A One to three months. Once she's delivered the baby and back at work, pregnancy is no longer an issue. But to strengthen your position, check her employment file for past documentation of poor performance, and continue to monitor her work closely.

Who should pay to notify patients of a practice sale?

Q Should the doctor who's buying my practice cover the costs of informing patients of the change in ownership, or should I?

A You should. Until the buyer takes over, you're responsible for your patients.

How to track out-of-control supply costs

Q Revenues are down and administrative costs are up in my practice. To boost my bottom line, I first want to try trimming the amount we spend on supplies.

Right now, we lump all supplies into a single category for accounting purposes. To get a clearer picture of our spending, my office manager suggested we divide supplies into two subgroups—clinical and administrative. She says anything else would be too time-consuming and labor-intensive. I think we should get more specific. Who's right?

A You are. Allocate supply costs into the following seven categories: clinical, pharmacy, laboratory, general office, computer, postage, and courier. It's a lot easier to spot overspending in a $1,200 lab-supplies category than in a $9,000 clinical-supplies category.

If seven subgroups don't give you a clearer idea of your spending and resource use, break down categories even further. Within the general office subgroup, for example, you could create categories for paper, copier supplies, cleaning, and the like.

The time and labor involved will be minimal if you use a comprehensive software program with check-writing capability, such as Quicken or Microsoft Money. True, setting up the categories on your computer will take a little time. But once that's done, it requires only a keystroke or two to enter each expense into the proper category whenever you write a check to a supplier.

Dividing the income pie fairly

QOur group wants to revise our compensation formula so that 50 percent of salary is based on shared revenues, with the remainder based on productivity. Should we allocate the productivity portion according to gross charges or to collections?

A Neither, say our consultants. A better measure is the number of relative value units each doctor bills. By pegging productivity pay to work RVUs, physicians will be credited in the same way, regardless of their patients' health plan coverage.

Edited by Kristie Perry,
Contributing Writer


Do you have a practice management question that may be stumping other doctors, too? Write: PMQA Editor, Medical Economics magazine, 5 Paragon Drive, Montvale, NJ 07645-1742, or send an e-mail to (please include your regular postal address). Sorry, but we're not able to answer readers individually.


Kristie Perry. Practice Management.

Medical Economics


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