# Benchmarking the Urology Practice

Authors: Paul A. Brower
Journal: Advances in Urology
 (2008)

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## Abstract

The medical practice today is relentlessly challenged by medical progress, by rising costs, and by the mounting pressures of the managed care environment. It should be the approach of every medical practice manager and practitioner to seek out and measure up to the best standards so as to optimize patient care and business outcomes. This requires the resolute pursuit of good models, brought about by the fostering of key collaborative relationships that are both practical and strategic. Integral to this process is benchmarking: the way by which information is obtained from both internal and external sources to determine and set the standards for performance. Benchmarking is an invaluable strategic tool.


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## Body

## 1. Introduction

The AUA Practice Management Committee sees the
broad applicability of benchmarking for the practicing urologist and can
conceivably become a clearing house for factual collaboration. Yet, there is no
movement in the wider urology community to connect practices toward this
effort. To promote involvement, a
solution is needed that will help sell the efficacy of benchmarking as a
strategic tool for driving growth and improvement. The difficulty, however, is
physician buy-in. It is within the nature of the average practitioner to stay
focused primarily on patient encounters and to remain preoccupied within the
practice. There is also a natural reluctance to share information.
Confidentiality and legal issues are usually of great concern and can hamper
open dialogue.While agreements
can be drafted to establish parameters and the usefulness of comparing
practices is commonly evident, what remains at the heart of the problem is the
perception that this is a labor-intensive exercise and an altogether
complicated and expensive process.


## 2. Materials and Methods

Orange County Urology Associates (OCUA) is a nine-physician, single-specialty group located
in South Orange County California that began gathering benchmark data four
years ago. OCUA was formed after a merger of two preexisting groups approximately
four years ago. We began gathering internal benchmarking data as a means of
measuring the success of the merger. We quickly realized the value of the
multiple benchmarks that we began to track, and have gradually increased the
number of variables that we examine. Our ongoing objective is to understand our
capabilities for maximizing profit while dealing with quality care and time
management issues. Thus, our approach is not to look at things in a broad or
general way but to seek out a careful explanation for each indicator, so as to
gain knowledge and provide for actionable results. This requires a process that expands
incrementally, one step at a time.There are two
forms of benchmarking: internal and external, with the former always the
necessary first step. The process of
benchmarking must begin with a baseline exam of the internal data points of the
practice: cost and revenue indicators as well as for productivity and staffing.
This is the beginning point of reference against which things can be measured
and compared and brought to focus. OCUA tracks patient encounter data. We look
at every physician, comparing each to their own historical data and to one
another. We also benchmark group performance and track it on a semiannual basis
for a comparison to previous years. The collection and organization of
encounter data give us knowledge about the competing demands for quality
patient care, resources, and accountability. Patient mix, patterns of coding,
and a myriad of encounter complexities specifically related to physician
performance are measured in addition to capitation reporting and claims
submission.


## 3. Results

Data for new and
return patients is analyzed on a per-physician basis to monitor current
procedural terminology (CPT) coding practices in order to determine the accuracy
in matching services to the correct code. By creating a matrix with the number
of encounters by CPT code for both new and return visits, it becomes
immediately apparent if one physician’s coding pattern deviates from the others
in the group. During this review, we have found both overcoding and undercoding
through the random selection of charts for individual physicians. These particular
charts are then reviewed by a collective group and analysis is undertaken
comparing the chart documentation to the billing slip. In the vast majority of
cases, the consensus is that the coding and billing were accurate. Sometimes, a
small addition to the documentation would have allowed a higher service code,
and on a few occasions, it was felt that the level of service was not
justified. Inaccurate documentation can mean heavy legal and financial
consequences for the practice, so it has been important to know how and why
individual physicians are using inaccurate codes. We find that most of these errors
occur because of either a misunderstanding of the guidelines, bad habits, or
as a result of the difficulty in correlating CPT codes with clinical service.
We have used this review as an audit tool and learning experience.The inoffice
procedure is the economic kicker for the practice. It drives income. We look at
all procedures done in the office, noting the ratio of procedures per new and
return patient. Once again, the comparisons are made on an individual and group
basis, and we find that physicians with subspecialty interest, such as
incontinence, will generally have higher numbers for procedures, and thus,
higher collections.Hospital
activities are tracked separately. To insure that everyone carries an equal
burden, each physician is reviewed for the work done in hospital consultations
and followup visits. The number of
inhospital surgical procedures is tracked per physician, with regard to new and
return patient work, including the number of long cases by CPT that take the
physician out of the office for a half day. Hospital work is valuable to the
group practice, but, in comparison to office work, compensation for assisting
in the hospital is so poor per unit of time spent that we pay assisting
physicians two thirds of the amount collected by the primary surgeon. To
wrestle with this problem, we set aside a pool of money to compensate the
primary surgeon and to promote collegial cooperation for work that would not,
otherwise, be equitable to the individual.Billing charges
are also tracked on an individual and group basis, but though they hold some
comparative value for what physicians do, the charges are variable from year to
year and by payer class. They are reviewed more in relation to what really
matters, which is dollars, collected. Another way to measure physician activity
is through the use of relative value units (RVUs), because, based on time and
activity formulas, they are not only a more objective measure for physician
productivity, but, being that the RVU amount is assigned to each service via
CPT codes, they also have a direct relationship with billing compliance.
Because reimbursement per CPT code varies greatly by the geographic location of
the practice, RVUs may be the only way to compare productivity between
practices and individuals in different regions.At the end of the
day, what really matters economically is collections. We track these on an
individual and group basis, monthly and semiannually, and notice that the ratio
of collections to billed charges tends to vary little among individuals,
unlike the individual payer mix, which can reveal marked differences in the
ratio of collections to billed charges and indicate the need for contract
renegotiation or even outright termination.Comparisons
between office-generated and hospital-generated collections are startling. It
is well known that reimbursement for surgical procedures has plummeted. Yotan calculates office fees increased 51%
while surgical fees decreased 28% from 1995 to 2004 [1]. As a group, OCUA generates only 15% of its
income from the operating room, and this percentage is remarkably reproducible
over four years, varying only from 14.5% to 16%; individuals track from 7% to
23%, with the highest level representing income generated by our male
infertility specialist who is handsomely rewarded in cash for surgical procedures. By using these data, we
are able to objectively determine the cruciality of the office work relative to
the financial health of the practice. Understanding its significance in
comparison to hospital time enables us to deduce how to best spend our time,
without sacrificing quality care. We now see the average income per patient
encounter as well as per surgical procedure and can look at income per unit of
time, comparing the office to the hospital. We are using a half day as the
basic scheduling unit, and, consequently, it is exceptional that anyone leaves
the office to do a case in the middle of a block. To that end, individuals
scheduled for the hospital round on all the patients for the practice before or
between cases to preserve the scheduling unit time commitment; those that are
in the office stay in the office. It was only when we had analyzed this
objective and reproducible data for our income that we really came to
understand how we make our money. This is a powerful example of how
benchmarking has modified physician behavior and enhanced productivity.While planning the
space and designing of our new office, we looked at two years of encounter data
for each physician for everyday. We analyzed the number of patients each MD saw
per half day and how many office procedures they did per session. We counted
the procedures that required a larger room such as a prostate biopsy or
cystoscopy which allowed us to most accurately predict the number of exam and
procedure rooms that were required. The data showed that 1 procedure room and 2
exam rooms per physician were sufficient for our patient volume. This is an
eye-opener for those individuals previously overestimating space requirements.
The office is configured for 23 exam/procedure rooms, with room now for 2
urodynamic setups, 3 ultrasounds, and capacity for numerous endoscopic and
bladder scanning procedures. Encounter data for the first two years in the new
facility shows that increases in exams, procedures, and income are
substantial. The 23 rooms allow 7 MDs
and a PA to work simultaneously.


## 4. Conclusion

In conclusion, we
find that quantifiable information which is based on data analysis rather than subjectivity
can allow for physician behavior modification and unnecessary predilections.
The physicians in the OCUA responded quite favorably to this information when it
was presented to them in a transparent manner. The numbers do not lie. Time
spent developing a panel of internal benchmarks and tracking them regularly enables
us to identify clear patterns, integrate critical functions, reduce
inefficiencies, and improve the fitness of our practice.Given this success,
we are hopeful to see an increase in outreach activities among urology
practices so that we can begin the process of external benchmarking.
Originality is great, but there is limitless value in learning from others.



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