Efficiency improvement is a life- long, continuous process. Efficiency improvement is a critical strategy for every practice because it results in improved quality of patient care as well as higher profit. Cost-cutting opportunities are more available with an increasing size of your practice, making overhead reduction the ideal strategy for larger groups. Remember, every dollar cut from overhead goes straight to the bottom line. Improve your collection ratio.
Most practices demonstrate a declining collection ratio as volume increases.
One reason for a declining collection ratio is that each new managed care patient can generate 40 to 50 new business transactions. Because there is less time available for follow-up of overdue accounts, adding managed care patients reduces the collection ratio for the entire practice. Practices experiencing this magnified increase in data and billing complexities tend to hire more staff. This is a costly solution. Adding personnel to an already inefficient reimbursement process cannot help the problems associated with either capturing data at the point of service or moving that data through the process.