With the hospital landscape becoming even more competitive and outpatient revenue growing at a faster rate, independent physician practices are becoming increasingly popular. This past summer, Modern Healthcare published an article stating that over a six-month span, two factions of North Carolina-based doctors left their respective health systems to form or join independent physician groups. In the article, those who support these moves said that, “the presence of physician groups not owned by hospitals creates a countervailing force to the power of the health system and improves care.”
Clearly, physicians are interested in working for practices that prioritize quality care and provide them with a sense of flexibility and transparency to make their own decisions. While the freedom that comes with joining an independence practice is alluring, many of these organizations struggle with day-to-day administrative burdens and managing their own revenue cycle management (RCM) services. More often than not, independent practices are devoting too much energy and talent into non-medical activities, which detracts time from their overall goal of providing excellent patient care.
To remain successfully independent and see overall financial improvement, practices need to dedicate more resources toward the following areas:
Many independent practices are being burnt out by the administrative work that comes with running your own practice. Handling this type of work and managing RCM operations independently is costly and takes unnecessary time away from patient care. Physician owners want to be spending time practicing medicine and serving patients rather than being bogged down by time-consuming clerical activities.
To address these concerns, independent practices are collaborating with third-party partners who can provide practice management support in areas such as billing services, coding education, quality and compliance, HR management, and much more. By working with a partner who can take on these areas, practice owners are receiving the support they need to streamline processes and refocus efforts onto patient care. Outside partners can also deliver the business expertise and support needed to make better financial decisions, create a strong infrastructure from which to expand, and increase overall practice revenue.
Since working with practice management partner R1, the Hawaii Emergency Physicians Association (HEPA) practice group has grown from serving four hospitals to nine. Efficient management has saved the group around $500,000 per year in operational costs. One Pediatrics has also been able to increase their collection per visit by over 18 percent.
Implementing a successful value-based quality program that benefits patients and the practice alike is also a top priority for independent practices. Practice quality improvement is a complex area that requires substantial expertise and ongoing review. Whether it’s quality-based reimbursement programs offered by private payers or compliance issues such as OSHA and CLEAR, the regulations are ever-changing and can be hard for a small to medium-sized independent practice to manage.
In addition, the Medicare Access and CHIP Reauthorization Act (MACRA)MACRA is requiring practices to have access to extensive patient data on treatment/related outcomes for reporting purposes. It’s challenging for many independent practices to achieve access to this kind of data due to a lack of interoperability between electronic health records. Hunting down patient care data and ensuring this information is incorporated into an independent practice’s system is an extremely time-consuming task.
When working with a third-party vendor, practices have access to experts who have the capacity to stay on top of industry changes, develop the processes and deploy the technology necessary to support ongoing reporting requirements. R1 frequently collaborates with independent practices to identify the most appropriate quality measures for tracking and reporting based on payer expectations. After analyzing practice work flows, R1 can recommend the most efficient and effective reporting mechanism to meet the necessary value-based criteria to maximize practice revenue.
As value-based contracting becomes increasingly prevalent in major healthcare markets, R1’s expertise in value-based reimbursement provides independent practices with the crucial information they need to analyze alternate payment models. Dr. Lawrence Jones, president of One Pediatrics said that, “With R1’s support, we don’t worry as much about declining reimbursement rates affecting our bottom line. Having professionals at our back while we negotiate our contracts has helped us stay viable in our fight for independence.” The structure of these alternate payment models and contracts can greatly enhance the traditional fee-for-service payments practices are currently receiving.
As independent practices continue to expand and serve more patients, it’s important for providers and staff to have access to the information they need, when they need it. Patient data needs to be in one consolidated location that is easy for staff members to access at a moment’s notice. Having access to the right data and analytics platforms not only creates transparency and increases efficiencies within a practice, but also transforms internal operations in a way that drives meaningful results.
Technology platforms offer practices the real-time support and data analysis necessary to provide faster and higher quality care. Data-driven provider dashboards give practices visibility into the financial, clinical and operational metrics of the business, allowing them to make more informed decisions. For example, HEPA has implemented R1’s TOPS Program, which optimizes staffing hours by matching patient arrivals to provider capacity. This technology takes the guesswork out of coverage planning so emergency departments can improve financial operations and ensure patients’ needs are met, which increases their overall satisfaction.
Claims-scrubbing systems can also resolve potential denials before claims are submitted. By having access to better data, practices can submit “cleaner” claims, resulting in accelerated cash flow. Since beginning their partnership with R1, One Pediatrics has used R1’s RCX technology to prove their clean claims rate to 99%, reducing the time it takes to collect from 32 days to 23.
As day-to-day responsibilities associated with running a practice continue to pile up, it’s clear that independent practices that try to handle this work on their own are at a significant disadvantage. Physicians should be spending their valuable time focusing on what they do best—delivering superior patient care—rather than trying to figure out how to balance books and expand business models.
Since partnering with R1, an independent practice like Associates in Dermatology (AID) in Louisville, Kentucky, was able to increase revenue by 30 percent and overall profits by four percent. “If you need business support to expand, you need to find a collaborator like R1,” Al Appel, chief administrative officer at AID said. “We’re dermatologists here, and that’s what we do well. We need to focus on that, on patient care. R1 helps us do just that.”
By partnering with a third-party vendor, practices are gaining new business direction and technology capabilities resulting in notable increases in growth and revenue. Physician owners can still manage their practices in their own way, but with an entirely new level of expertise that will put their group in a much better financial position. This partnership is a proven way for practices to remain focused on the patient, gain valuable resources and maintain what’s important to their providers: independence.