Let’s Talk About What Happened In Vegas

My friends from the Pediatric Management Institute (PMI) put on another great practice management conference in Las Vegas last January.Screen Shot 2016-02-21 at 10.55.37 AM

The content was excellent, thanks to the fabulous faculty PMI brought in.

The topics varied from customer service principles to fundamental changes happening in the health insurance industry and how those changes are – or soon will be – affecting doctors’ financial bottom line.

Below are a few highlights and notable points that resonated with me.

ANCILLARY SERVICES | INCOME DIVERSIFICATION

Dr. Jeanne Marconi presented an account of how her practice diversifies income streams by incorporating ancillary services into her practice.

Admittedly Dr. Marconi’s comprehensive – almost overwhelming – plethora of services (they even offer in-house exercise training programs for children with high BMI) is probably too much for the standard practice to implement.

But for me, her talk wasn’t an invitation to follow her footsteps, but instead, provide insight into what is possible, what can be done and what is available to practices.

Dr. Marconi dished out several challenges to the physicians in the crowd. But the one that resonated with me the most was her call for pediatric practices to challenge the status quo, expand their minds, think creatively (or to use a cliche, think outside the box) and begin to think about ways to diversify practice’s revenue streams.

HOW HEALTH INSURANCE COMPANIES ARE PAYING DOCTORS

Susanne Madden arrived in Vegas with her extensive knowledge and expertise of the health insurance industry.

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Dr. Jeanne Marconi and Susanne Madden

She presented attendees the sobering reality of how health insurance companies are adjusting, changing – even experimenting in some cases – with their models to continue delivering value to “their” shareholders. And by value, she means lower cost and higher profits.

Susanne underscored the importance of implementing quality measures such as P4P, HEIDIS, PCMH into our medical practices. But not for the reasons you might think.

While many of these health insurance programs are currently in place as rewards (e.g., enhanced or incentive payments) for medical practices that achieve quality measures thresholds in patient care, Susanne highlighted that these programs will soon become a requirement for practices.

What does this mean exactly? Insurance companies will soon stop offering enhanced payments programs to practices for achieving PCMH level III certification (or other types of incentives). Instead, they will reduce payments to doctors don’t meet PCMH certification.

As if that wasn’t bad enough, she added that many payers are evaluating providers based on how much the provider costs the company in benefits payouts.

How is that different than what they do now?

The difference is that they are not looking at the practice as a whole, but rather evaluating each provider individually.

The implications are that if you have physicians in your practice that don’t adhere to designated quality standards, payors can potentially pay each doctor in the practice different amounts.

HOW MUCH CAN WE AFFORD TO PAY AN EMPLOYED PROVIDER?

PMI’s very own Paul Vanchiere gave two of his hallmark presentations. The first one focused on customer service using the acronym KIDS (Kindness, Integrity, Dignity & Service).

His second talk was my favorite. Why? Because Paul took a complicated, MBA, executive consulting level exercise (determining how much can your practice afford to pay an employed provider) and distilled it into an easy to follow, step-by-step, process, which only requires one to understand a few financial concepts and enter value sets into a spreadsheet.

BROADEN YOUR CODE REPERTUAR

Dr. Rich Lander went over the fundamentals of proper coding. In addition to reviewing the differences between coding Level 2, 3, 4 & 5 for a sick visit, Dr. Lander stressed the importance of documenting “time” correctly in a patient’s chart.

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Joanne Blanchard and Dr. Richard Lander

Dr. Lander shared multiple clinical scenarios that we often encounter with patients. But some of the codes he suggested I wasn’t all too familiar with. I couldn’t recall if we used them.

So I wrote down a reminder to myself to check how well (or not) providers at Salud Pediatrics were using the full scope of codes available.

NO PRESENCE, NO INFLUENCE

Dr. John Moore – a new PMI faculty member – brought us up to speed with some of the new social media trends (Are you familiar with SnapChat and how kids are using it?)

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Dr. John Moore and Paul Vanchiere

One of the points that Dr. Moore articulated that I appreciated the most was the importance for pediatricians to embrace social media.

He said something that I’ve been saying for a long time; which is, had pediatricians adopted social media at a faster clip, the pro-vaccine vs. anti-vaccine arguments would have been balanced. Moreover, there was the potential to stifle the anti-vax movement.

CHANGE IS THE NEW STATUS QUO

You can always count on Chip Hart to deliver great wisdom and insight. Chip also gave two talks.Screen Shot 2016-02-21 at 10.56.11 AM

I’ve heard Chip speak many times, but this time, I felt his talks were different. Chip’s talks had a subtle, tough-love tone to them.

While addressing the challenges practices are facing today, he stressed that pediatricians have faced similar challenges before. He mentioned that during all previous tectonic shifts (aka industry changes) naysayers shouted out the demise of private practices. Much like many are shouting today.

Chip eloquently argued that not only are the doomsayers wrong, but that pediatricians are actually in a better situation than most think.

Chip wasn’t disregarding the challenges or downplaying the potential threats. We are indeed going through tough times. But these tough times were an opportunity to transform and reinvent our practices, he argued.

My takeaway was: If the plan is to defend the status quo and hedge the long-term success of your business on account that you have the initials MD after your name, thus somehow inoculated from change, the end is certainly near for you.

MEETING, CONNECTING, NETWORKING, SOCIAL LEARNING

Attending a seminar like this to learn from the speakers is certainly worth the price and the time. But more often than not, the icing on the cake, at least for me, is the immeasurable, intangible value I glean from networking.

The people who attend these events are the smartest and brightest in my opinion (and I’m not talking about the faculty, although they are good too).

Whether attendees are veterans in managing practices or opened their first private practices last week and believe they have no clue what they are doing, the truth is, there is opportunity to learn from everybody.

The faculty makes the trip worthwhile. But I would say the attendees make the event special.

Next year I hope to see you there. Especially if you didn’t get a chance to attend this year.

Place: New Orleans
Dates: Jan 27-28th 2017

 

What Does A Convenient Store And A Medical Practice Have In Common? 

The answer is, Cost Accounting.

Cost accounting is one of those topics that you either find fascinating (this makes you an accountant) or find it as boring as watching reruns on C-Span.

If you belong to the latter group, don’t worry. I got you covered.

Using a convenient store as the backdrop for the narrative, my friend Paul shares in the video below, the fundamental business principle of cost accounting and how independent pediatric practices can apply these principles.

The video is only 5-minutes long. But the lesson will stay with you for a lifetime.

Enjoy!

 

 


 

About the presenter:

Paul Vanchiere is the co-founder of the Pediatric Practice Management Institute. PMI is a consulting group that specializes in helping pediatric practices in a variety of ways. To check out the variety of services Paul and his team offers, click on the link below.  

Pediatric Practice Management Institute

 

#6 Learning Steps to Budget for Your Medical Practice [Practice Management VideoCast]

In this episode, Chip and I have our first guest. Paul Vanchiere was kind enough to sit down with us to talk about budgeting.

Why budgeting? Well, I suspect that this is an area where many practice don’t excel. If you are part of a larger group, the likelihood you have a sound budgeting process that is sophisticated. But for those in smaller offices, not so much.

Paul is a great guest because he has been worked in many different healthcare setting. This experience has given him a unique perspective that I find interesting.  And it so happens, he’s worked a lot on budgeting for both large and small practice.

Paul highlights 3 key issues that we ought to consider in order to properly budget for our office. The are:

  1. Capacity
  2. Payment – Revenue per encounter
  3. Expenses

Want to learn more about these 3 keys? Then watch the video.

Before you go though, let me mention a few things.

Podcast

We make the video into a podcast so that you can download it and listen to it at your leisure. The podcast goes for about an hour. Chip, Paul and I stick around and continue talking…. we sometimes leave “nuggets” of info towards the end.

You can go to iTunes, search for pediatric practice management or go to this link if you are not fond of the iTunes ecosystem. http://ppmmc.libsyn.com/episode-6-03-06-13-setting-a-practice-budget

Seminars

Paul is doing seminar in several parts of the US this year where he will address budgeting and other practice management issues. If you are interested in them, follow this link: http://www.pediatricmanagementinstitute.com/

OK, here is the video:

How much does it cost to see a patient in your medical office?

If y0u were to ask the average business owner, how much does it cost to make widgets, my guess is that 9 out of 10 would know exactly what that figure is.

On the other hand, if you were to ask a doctor who owns the practice, how much is it costing you to see each patient, I’d argue 9 out of 10 wouldn’t know.

Now, I’m making huge assumptions of course, but I think the point is valid. Doctor’s offices do a very poor job of understanding basic business principles, such as, figuring out their cost.

Figuring out cost can get complicated, and there is certainly a lot of ways of doing it. But I tend to think that there is elegance is simplicity.

Gather the total number of encounters. Next, gather all your expenses. Then, you divide the two:

  • Expenses – 850,000
  • Encounters – 10,000

850,000 / 10,000 = $85

Under this scenario, each encounter is costing the practice $85.

Knowing, measuring and benchmarking this number will put you on the right path to stay ahead of the curve.

Sharing the Practice Management Love Part 2: Cost

Looking for ways to reduce cost seems like a no brainer. But as practice managers we often get comfortable or maybe even distracted by day to day things. My point is, don’t get comfortable and don’t get distracted. There is always an opportunity to find ways to reduce cost.

Yesterday, I kicked off a series that gives readers a peak at some of the things our practice has been doing in order to stay strong as a practice and more important, as a business.

cutdollarbill1The posts are motivated by seeing a lot of experts online recommending how to do things better, yet never really providing  practical examples of their recommendations. I’m not suggesting medical consultants and experts don’t have good ideas.  I just like to hear practical examples to help me put into perspective how I may implement a suggestion or recommendation in a busy medical practice.

A little disclaimer, I’m not suggesting with this post that I’m an expert either. Just a practice manager trying to run my business a little better.

But I do have practical examples. So here goes my second post in the series, sharing the practice management love.

Looking for ways to Reduce Cost

Lately, it seems I’ve been looking at how much things cost a little more than before. Managing cost is a business principle, but in times like this, cost is even more essential. Consequently, I’ve been more proactive in bringing in vendors and discussing pricing. I’m usually very open about showing how much I pay for supplies, vaccines and things like that. The purpose is to try to get competing vendors to match or beat prices.

Vaccines

One area I spend time on is vaccine cost. Strictly from a business perspective, vaccines are a thorn on my side. If you manage a pediatric practice, you know what I’m talking about. But we have to have vaccines, thus learn how to manage them.

About a year ago, I created a vaccine analysis in Excel that helped me determine how we are doing with our vaccines.  I’ve read before that many pediatric offices lose money on vaccines and others profit from them and for the longest time, I admit I didn’t know which side of the argument I was on.  So I created a vaccine analysis to help me scrutinize cost, reimbursement, profitability and many other things. Furthermore, if there are changes, like price increases, all I have to do is update the file and the sheet will tell me how the adjustments will affect our bottom line.

(I’d be happy to share with you my vaccine analysis if you post a comment on my blog. I have a template in Excel that I modified from another template my friends at http://www.pedsource.com/ posted on their site courtesy of Jerry Freed, D.O., South Tulsa Pediatrics, PLLC. By the way, Pedsource is free to join. I encourage you to go right now and sign up.)

What do I do with the data I generate from the vaccine cost analysis Excel sheet?

I’ve sat down numerous times with GSK, Merck and Sanofi/Pasteur representatives and discussed at length pricing, cost, reimbursement, inventory management and vaccine cost reduction programs (group purchasing, Vaxmax, prompt payment discounts, etc.) available to us.

The vaccine cost analysis helps me know I’m managing our vaccine usage well, but also helps me know I’m getting the lowest possible cost on those expensive vaccines.

Group Purchasing Organizations

In addition to analyzing cost, joining group-purchasing organization is a great way to decrease expenditures. Our practice works with CCPA and Amerinet but there are many out there. GPO’s are a great way to reduce your cost. If you are not part of one, find one. Here are three to get you started:

National Discount Vaccine Alliance
785-273-2044
www.nationalvaccinealliance.com

Atlantic Health Partners
800-741-2044
www.atlantichealthpartners.com

Physician’s Alliance
770-446-9789
www.physall.com

Comfortable & Distracted

Looking for ways to reduce cost seems like a no brainer. But as practice managers we often get comfortable or maybe even distracted by day to day things. My point is, don’t get comfortable and don’t get distracted. There is always an opportunity to find ways to reduce cost.

Of course, these are just a few examples of ways to reduce expenses.  If you have a few moments, share your ideas on how your practice saves money.

Next Post

For my next post, I’m going to be talking about reporting, data analysis and finding ways to  look at our business differently by running reports.