Practice ‘report card’ tracks performance

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Is my staffing level appropriate for my practice? Is my overhead too high? Is my billing department doing a good job?

These are just a few of the questions we are asked by urology groups around the country. One urologist recently asked a broader question: What should I be looking at each month to see how well my practice is operating?

As we move from a fee-for-service model to a value-based model of payment, the answer to this question will evolve to include a much broader look at practice services and the measurements applied. This article focuses on several common and easy-to-measure data points within a practice that provide a report card to monitor on a monthly basis.

Although every office has intangibles that are difficult to measure, most of the day-to-day operations of a urology practice can be measured by reviewing data you already have available.

Benchmark comparisons, where available within tables 1 and 3, are provided based on Physician Reimbursement Systems Network experience, data collected from practices, and an amalgamation of data sources including the AUA, The State of the Urology Workforce and Practice in the United States 2016 (AUA Census report), IntrinsiQ’s InfoDive tool, the Medical Group Management Association, and Medscape.

Understanding your baseline

The practice report card numbers you track are relative to your previous numbers illustrating trends. As a starting point, we recommend that you look at the metrics described in table 1. While these categories are difficult to benchmark against other groups, they provide valuable information.

Practice Data Reports

Item Last Month Year to Date
Total charges No benchmark No benchmark
Total payments No benchmark No benchmark
Total adjustments No benchmark No benchmark
Total patient visits 240-475 No benchmark
Ending accounts receivable (A/R) No benchmark No benchmark
Total insurance A/R No benchmark No benchmark
Total patient A/R No benchmark No benchmark
Source: Data based on Physician Reimbursement Systems Network experience, practice data, AUA 2016 Census report, IntrisiQ’s InfoDive tool, Medical Group Management Association, and Medscape

You need to understand your starting point for these numbers in order to evaluate yourself. As you leverage data to measure performance and begin to implement change, make sure you are comparing apples to apples. In other words, make sure you use the same report requests each month as you compare your production. Take into account vacations, timing of charges, etc. before jumping to any conclusions.

In short, the data provide a result; you will have to look at bit further to determine the root cause of any glaring change. These numbers should be reviewed at the practice level as well as each specific provider. How you use the data will depend on your organization and your position. However, we recommend you keep track of what you are doing.

Production Report

CPT/HCPCS Code Modifier # of Units Month to Date
Source: Ray Painter MD, and Mark Painter

An additional non-benchmark report that is recommended for monthly review is a production report (table 2). This report should provide you with the number of times each CPT code was billed for the time period in question. This report, reviewed in a timely manner, can provide a quick double check on surgeries and provide guidance on your evaluation/management performance month to month. In addition, we have found that this report is helpful in connecting the physician to the billing department. Modifiers may also be added for additional information to provide a more in-depth view of the practice if the system allows.

Other report card metrics are outlined in table 3.

Comments on calculations

Recommend month to date (MTD) and year to date (YTD) for each column. MTD calculations provide a checkpoint from which to explore variation. YTD numbers allow for payment and charge lag adjustments and are better as a comparison to benchmark for the majority of categories.

Average charge/visit and average payment/visit. Payment lag in the health care system will result in MTD and YTD numbers using a trailing collections average. Benchmark numbers are calculated in this manner, allowing direct comparison.

Days in A/R. Days in A/R is a relatively straightforward two-step calculation in which:

  • Divide your gross charges by the days from which the data is compiled. As a general rule, longer periods of time provide a better picture of the practice.
  • Divide the total A/R by the charges per day.

Total RVUs. Noted in calculations for both average RVU/visit and average conversion factor, utilize total RVUs adjusted for place of service and modifier applied (thank you, IntrinsiQ InfoDive). This calculation can also be performed using your production report for the month and the total RVUs from Medicare; multiply number of units for each code by total RVU for each code and sum. This simplified method will result in a higher number of RVUs per visit and a lower conversion factor than the benchmark provided.

Practice Data Calculation Analyses

Item Formula Benchmark
Avg. charge/visit Gross charges + # of visits $225 – $250
Avg. payments/visit Gross payments + # of visits $145 – $170
Days in A/R (DAR) Gross A/R + average charges per day 28.0 – 32.0
% A/R over 120 days A/R>120 + total A/R 7.5% – 9.0%
% patient A/R Patient A/R + total A/R 8.0% – 10.0%
Avg. RVU/visit Total RVUs + # of visits 4.35 – 4.65
Avg. conversion factor Gross payments + total RVUs $40.50 – $42.50
Source: Data based on Physician Reimbursement Systems Network experience, practice data, AUA 2016 Census report, IntrisiQ’s InfoDive tool, Medical Group Management Association, and Medscape

 

Many systems will allow you to calculate this data at the provider level. This additional level of detail assists the group in identifying changes based on staffing levels, problem providers, and/or payer mix concerns. For those practices with multiple locations, calculating by location can provide additional information on office personnel and payer considerations to assist in further data-based change targets.

Conclusions

The list of metrics and benchmarks provided in this article focus primarily on the revenue cycle of a practice in the predominant fee-for-service market. As you consider data in your practice by these or other metrics, we encourage you to remember that a urology practice is a complex ecosystem with many moving parts. Data should be considered routinely as vital signs or symptoms that will likely require diagnosis and treatment.

As many of you know, if the data point to an issue in the practice, your first step should always be a thorough diagnosis digging into the problem from different angles and departments. We typically find that, in a practice with metrics out of balance, there is more than one root cause.

Finally, once a problem is clearly diagnosed, a plan to correct the issue must be developed and implemented. Often, these plans require time and changes in more than one part of the practice. Successful plans require clear and constant communication and leadership/ownership to implement. Stick with your plan and continue to measure your practice to preserve the financial health of the business that allows you to provide care to so many.