Over the past several years, medical practices have faced declining reimbursements from insurance providers. Declining reimbursements have resulted in tighter budgets for practices. Physicians are searching for ways to speed up cash flow or reduce operating expenses to compensate for the decline in reimbursements. This ongoing battle has affected many of our clients. Clients are seeking to improve cash flow in their practices. As an advisor, I recommend the following strategies to my clients:
- Ensure you confirm the patient’s insurance coverage each time there is a patient visit. This will ensure that you have the current insurance coverage for patients in case they have changed jobs or insurance carriers.
- If the practice does its billing of patient encounters, you should determine the “rejection” rate and investigate the reasons for the insurance company rejections. The objective is to reduce the amount of “rejections.”
- If you use a billing service to bill for patient encounters, you should meet with the billing service to determine what changes you can institute to reduce the number of “rejections.”
- Renegotiate vendor contracts. Meet with all vendors, supply providers, phone and internet services, medical waste disposal, etc. Often, rate increases occur every year, and a simple phone call to your vendors can result in a new contract at a lower rate, or you can shop for alternative providers that might save you some money.
- Review the office’s staffing and consider using “part-time” employees to handle the busy times in the office.
For more information about reducing expenses and increasing cash flow in your medical practice, call 714.569.1000.
