Are you working harder to earn less money? Then it’s time to consider that your practice isn’t as efficient as it needs to be in today’s health care economy.
Inefficiency is a hidden practice cost that ends in thousands of dollars per year of lost doctor income. Increasing practice efficiencies is a powerful way to add to your bottom line, both in direct savings, and indirect generation of revenue. While you never want to skimp on direct doctor to patient interaction, you can cut out needless redundancies in management and take home thousands of more dollars per year.
Let me provide you with four examples from clinic management research, dealing specifically with the adoption of electronic health records (EHR).
Example 1: $2,400 lost to paper per year
An average chiropractic practice can save $2,400 per year in overhead costs just by switching to the right EHR system. That $2,400 lost is the direct result of paper-based management. That figure includes the actual cost of the paper and supportive fixtures and the hourly cost of staff handling for filing of documents into patient charts.
A modest patient load requires the processing of so many paper files per day. That processing requires an administrative assistant to move across the reception area, locate a file, pull, and process. Assuming administrative staff makes $10 per hour, and the clinic sees 120 patients per week, savings per year to manage digital files versus paper files is $2,400.
$2,400 is the time-value placed on the sum total of paper moving by a single office assistant over one year, plus the cost of paper. That’s your direct cost savings. Now, imagine your indirect revenue possibilities.
When your staff isn’t handling paper, they are free to do other tasks that directly support your practice growth. Whether that task is marketing, assisting in patient care such as therapeutic modalities, or processing more patient visits electronically, that’s money not spent just moving paper.
Example 2: Thousands lost to coding errors
In every industry, errors cost money. Every time an error is not made, more money is left over for profit. I’ve spoken firsthand to chiropractors who attribute approximately $30,000 growth in profit to their EHR’s. They do so, because the systems they use come with built in alerts that identify coding and billing errors or omissions before they are made. Can we agree that coding haphazardly lowers your reimbursement, because your confusion about what’s allowable and ethical is an error that should be prevented?
Take for example a case study of one doctor in Wisconsin. Over one year he tracked his case visits, and money spent on marketing, staff, and fees. He saw little change in any of those numbers, yet he collected over $30,000 more that year. What did he change? He moved to an EHR which gave him a billing error rate near zero. With zero errors he was able to bill for the real values of his services, which increased his reimbursements.
Example 3: Reducing your non-billable workload
The average value of a chiropractor is $250 per hour dependent on market and practice value. If doctors reduce the amount of time spent on patient clinical documentation by a half-hour per day, a task which is non-reimbursable, this could mean $125 per day in saved lost time. With 220 workdays per year, that’s $27,500 annually.
What would you do with an extra half-hour of time per day? More time with family or more time in service? How about more time in direct patient care, a billable service?
Example 4: Lost revenue from missed appointments
Depending on your practice size, you may be missing anywhere from a few hundred to a thousand dollars a week in missed patient appointments. If your EHR system includes automated missed appointment activation, then these are dollars you don’t have to lose. Technology reminds your staff to call no-shows and assists in keeping patients compliant with treatment plans to ensure that no one slips through the cracks.
Yes, these are tasks which can be accomplished manually, but they are laborious. Not many practices fulfill them on a consistent basis. Technology can immediately track missed or lapsed appointments and create automated lists for staff to reschedule. The savings in this scenario depends on your current procedures, but you can bank on its value.
Reaping your true practice value
These examples aren’t the total sum of the ways you can save money with the right EHR system. In fact, there are other technology based strategies that can help you earn thousands more per year by helping you do what you already do better. Other benefits of EHR technology revolve around improved delivery of care, guidance with clinical best practice protocols, and more meaningful clinical decision making with relevant information about the case at your finger tips during the point of care. Just remember that an efficient practice can be a more profitable practice. And, in today’s health care economy, that requires a practice built on the proper clinic technology.
Dr. Steven J. Kraus is CEO of Future Health, Inc., a company that partners with chiropractors to deliver a comprehensive clinic management solution, including fully-integrated EHR. Dr. Kraus is a recognized expert in building successful clinics, having developed and sold 18 practices of his own and provided strategic consulting services to more than 400 healthcare businesses. Contact Dr. Kraus at [email protected] for more information.