Medical practices today face many challenges. One of their biggest challenges is combating rising costs. According to the January 2013 issue of “The State of Medical Practice – MGMA Connexion magazine”, operational costs have risen five straight years in a row. Small practices, with a limited number of physicians and resources that can only be stretched so thin, are being hit the hardest.
To further complicate things the Accountable Care environment is leaving practices struggling to find ways to cut costs without compromising the quality of care. As a result some practices are being forced into partnerships, mergers & acquisitions. In today’s healthcare environment practices have limited ways to effectively control cost. For those practices struggling to remain independent having a strategy to combat rising costs while focusing on care is the key to their success and this strategy should include an action plan targeting these top 4 areas that can be effectively controlled:
TOP 4 AREAS WHERE COSTS CAN BE EFFECTIVELY CONTROLLED
- Staffing — Staffing costs and the cost of obtaining experienced staff are rising.
- Salary for Biller/Coders raised 5% to 9.7% [Source: 2013 AAPC Salary Survey]
- The cost of front office support staff has increased 35.39% over the past 4 years. 18.9% in past year [Source: MGMA Cost Survey 2013]
- Staff turnover —Cost of staff turnover is high and trends show that medical staff turnover is continuing to rise:
“Average medical staff turnover was at 29.4% in 2013. Up 4.7% from 28% in 2012”
[Source: U.S. Bureau of Labor Statistics – via Nobscot Corp]
- Staff recruitment and training —Higher staff turnover means higher cost in staff recruitment and training. This year training of both current and new employees will be especially important in preparation for ICD-10. MGMA recommends that medical practices plan for 16 to 24 hours of training for the clinical staff and 40 to 60 hours for coding staff.
- Technology costs — Too often technology is not fully optimized and configured to its fullest potential to effectively streamline work flows and get practices the most out of their investment.
You may ask what are some key action strategies you can take today to combat these 4 key culprits of rising costs?
Here are a few key strategies successful practices have taken to innovate and respond:
- Assess and pinpoint all cost areas & evaluate options: staffing, space, supplies, energy, Etc.
- Take steps to protect and retain your current staff
- Evaluate co-sourcing options as a means to gain support of high quality talent you would otherwise not be able to retain
- When evaluating options consider vendors that support a variable cost model.
- Where technology is concerned look for a technology partner that demonstrates a commitment to client partnerships and provides proven solutions and education to help you secure stimulus incentives and meet regulatory requirements as well as services to ensure your technology is fully optimized and configured to streamline your practice and get you the ROI you deserve.
See how this practice is getting results with RCM Services.