Part of ensuring smooth and profitable workflow involves consistently examining the overall “health” of a medical practice.
Healthcare industry solutions generator MGMA offers strategies for measuring a practice’s vitality to maximize growth and performance. According to Ron Holder, MGMA COO, productivity does not have an absolute limit, and it cannot be accurately measured by relying on isolated statistics. Evaluating practice productivity depends on the expectations of each practice. Holder urges physicians to consider that productivity can be influenced by negative factors like low staff numbers and excess patient loads. As such, determining a practice’s success should depend on more than simply meeting productivity goals; it should draw from numerous indices to form a holistic assessment.
A crucial metric when benchmarking medical practice data is the prior year’s practice-level performance, says Holder. He suggests that simply measuring this metric as a benchmark reflecting a practice’s success or failure is not effective, as doing so may not be an “apples to apples” comparison. Rather, he advises reviewing essential performance indicators like previous year patient volumes and practice revenue to measure this metric.
Provider-level performance can also be measured via these factors. This metric considers the arrivals and departures of physicians. Support staff and infrastructure changes can drastically affect provider-level performance. The comings and goings of new patients and follow-up patients also serves as an important metric for any medical practice. A thriving practice should consist of a balance of both patient genres.
Holder also values budget as a crucial metric. In order to maximize revenue, he suggests examining a practice’s revenue each month and at each quarter. If a practice has the necessary budget to meet productivity, this may be a valuable predictor of the practice’s financial performance, especially if elements other than productivity were correctly projected. Holder urges physicians to bear in mind that factors like efficiency, productivity, and general operational success must be considered when determining the effectiveness of a practice’s budget. For example, a practice may realize its productivity budget might not be in a good place if it had to significantly increase expenses beyond the budget to get there.
As a general launching point, Holder advocates benchmarks like analyzing and comparing a practice’s efficiency stats, year-over-year financials, and operational data. Employing these types of benchmarks can be useful in deciding what a practice needs to accomplish, as well as what it is capable of accomplishing. In examining a practice’s metrics and creating effective benchmarks, physicians can gain an excellent perspective of their practice’s health and functional wellbeing.