Keeping Your Eyes on The Data That Affects Your Practice’s Financial Health

Numbers don’t lie. You can always count on them to tell you the truth. But, are you looking at the right numbers? 

Trying to watch your speed by keeping an eye on the radio station isn’t going to protect you from getting a ticket. Likewise, as you manage your medical practice, keeping an eye on the wrong numbers aren’t going to keep you from getting into trouble.

So what exactly are the right numbers you should be focusing on? These are known as key performance indicators (KPIs), and they are the essential data that report how well your business is doing in meeting important milestones. In the healthcare industry, these KPIs can range from basic financial data to more complex statistics. 

While there are hundreds of KPIs you can track, the following metrics can give you the most significant return for your effort.

Your Overtime Trends

In our experience, overtime can be a massive expense for medical practices, and the cost isn’t just the extra money in payroll. Recent studies show what everyone knows by experience: the quality of work declines and staff morale plummets with prolonged overtime. Specifically, those who work shifts of 10 hours or longer are up to 2x more likely to experience burnout, job dissatisfaction, and intend to leave their job. 

So, unnecessary overtime not only carries a financial cost to your practice, but it could also be a cause for employee churn and patient dissatisfaction. Ouch.

However, by including overtime data as part of your monthly KPIs, you can effectively manage and reduce wasted overtime by figuring out whether you can cut hours or schedule them more efficiently. To effectively track your staff’s overtime, consider:

– Tracking your weekly overtime hours
– Knowing which employees qualify for overtime exemption
– Examining your overtime coverage to ensure you aren’t over-scheduling
– Keeping staff accountable for getting overtime approval

Your Net Collections Rate

Are you only tracking what you bill? Unfortunately, not every bill gets paid. This means that if you are only looking at your gross collections rate, you will have a pretty skewed perspective of how your practice is doing. These numbers don’t tell you how much you collected compared to the total you are owed. 

So, if you want a more accurate snapshot of your collection rate, you should be monitoring your net collections rate instead. This number is going to include write-offs, refunds, and other contractual amounts. This critical adjustment will give you a more accurate benchmark, as it measures your effectiveness of collecting reimbursable dollars.

Your Missed Appointments & No-Shows

Depending on your rate schedule, 4 missed appointments per day could be costing your practice up to $150,000 a year per doctor. That is why keeping this data at arm’s length is a smart move. If you’re not sure what your no-show rate was for last week, divide the number of missed appointments by the total number of patients scheduled. Keep doing that every week, and you will have some pretty valuable data at hand.

Many practices find that having a clear and well-planned script for schedule reminders improves patient commitment to keep the appointment. Any costs associated with an automated text, email, or phone reminders are easily offset by keeping more appointments.

Keeping Your Eyes On What Matters

With all of the moving parts and pressing demands that go into running a medical practice, having a few key data points that you track over time can be one way to guard against the slow drift towards declining profits and wasted energy. 

KPIs can be the critical gauges you track, helping you discern when it is time to slow down, speed up or change lanes.