What is a medical practice benchmark assessment?
A benchmark analysis is a financial review that establishes a baseline measure of the financial health of a medical practice and serves as the foundation for developing strategies to increase your medical practice revenue and financial performance. It is a review of actual practice performance benchmarked against industry standards and helps to identify financial gaps of which the practice might not be aware. A benchmark assessment is a first step towards strengthening what is working, correcting what is failing, and setting the stage for providing valuable financial advice.
Why should a medical practice have a benchmark assessment?
Every medical practice should have a benchmark assessment because it can identify revenue opportunities and potential cost savings that would otherwise go undetected. There is a positive correlation between benchmarking reviews and improved cash flow. On average doctors collect only $.24 to $.32 on every dollar they are entitled to primarily due to inadequate collections processes and inaccurate billing procedures. When managed professionally by medical billing consultants, these two categories could represent up to a 25% cash flow increase.
What does a benchmark assessment analyze?
A thorough analysis will include reviews of transaction history, outstanding claims profile, patient aging and insurance profile, as well as an operational insights and observations. The transaction report is a history of actions taken on each charge and captures all payments for primary, secondary, tertiary and patient activity. An insurance aging profile report captures all outstanding claims that are due from respective insurance payers based on monthly aging from 30 to over 90 days. The patient aging report breaks down the patient balance amounts due by aging 30 to over 90 days. The insurance profile report provides a historic count of the primary insurances billed and the total charges, payments and write-offs by payer.
Collectively, these reports provide the performance statistics needed to calculate collection ratio, analyze the patient collection process and evaluate the days in accounts receivable (approximate number of days to collect outstanding accounts receivables). They can also be used to determine recoverable reimbursements which are defined as optimal receipts from all insurance payers and patients collected in a timely manner. With this data, it is possible to review claim rejection and denial management, as well as benchmark accounts receivable to industry norms based on a given discipline and geographic area.
Who should consider a benchmark assessment?
Every practice struggles to collect what they are owed. If you are experiencing lower reimbursements, growing accounts receivables, or earning less than previous years, you should consider a benchmark assessment. It is a tool that can be used whether you resource your practice to medical billing consultants or maintain your billing in house. The assessment results will identify revenue cycle management solutions that can be implemented by a professional service or on your own.
What information is needed for a benchmark assessment?
In most circumstances, AssuranceMD requests a 12 month history of four basic reports. The following reports are accessible from most practice management applications:
- A Procedure Transaction Report
- Insurance Aging Report
- The Patient Aging Report
- The Insurance Profiles
There a fee for a benchmark analysis.
Contact us today to schedule a benchmark assessment for your practice!