Are you ready to become a Best-in-Class Medical Practice?
As a physician executive of a medical “business” or “enterprise”, in many cases, you are not only the “doc” that treats patients, but you are also the executive leadership team of one.
How will you gather the required business intelligence (BI) to make fact-based decisions and business analyses to run the business and make it thrive?
In healthcare, as in other sectors, executives need the ability to look deeper into their company’s operational activity and ask new questions.
The answers to this question comes from data transformed into information for decision support. Too often, small practices suffer from little or no IT assistance, and an inability (or time) to get data out of the billing computer and the electronic medical records system to identify and exploit tangible opportunities for top- and bottom-line enhancement. I know it because have practical experience as the practice administrator of a one-, two-, five-, seven-, and even a forty-physician multispecialty group over the past thirty-plus years to personally identify with these challenges.
The qualities that make up a successful physician executive of a small medical practice are as diverse as they are rare.
For most physicians, especially those fresh out of residency or fellowship, business experience and decision context are, and will always be, crucial elements of the physician executive skill set. They don’t teach these skills in most medical schools and there’s no time to learn it in residency. Then you are forced to go out and earn a living doing something that pays enough to be a sustainable business, and leaves enough left over at the end of the month to pay yourself, save a little and pay down those student loans.
In larger healthcare businesses, (hospitals surgery centers, pharmaceutical, device manufacturing, etc.) one would assume that those executives have a good grasp of the required maturity and domain expertise supplemented by BI tools and technology for factual decision support in plan good strategies. Maybe. And maybe not.
The explosion of business data is affecting enterprises of all sizes and configurations, but the ability to exploit the data and transform it into usable business insight, is what distinguishes Best-in-Class organizations from the rest. So, enough talk about all those other businesses. Let’s get granular:
How is a boutique medical practice with 600 patients or fewer going to access better business information and turn it into something useful to make the practice thrive?
Is that data need any different in a solo practice of a physician with 3500 patients? Not really.
What are your top barriers to accessing timely and useful business intelligence data?
Perhaps the most important aspect of efficient business intelligence (BI) is the underlying data that feeds into the analytical systems. Cleanliness, relevance, and timeliness are all crucial aspects of data that dictate the quality of the business insight that can be generated from its analysis.
As medical practice business data continues to grow in both volume and complexity, the need for efficient data management becomes an even greater imperative. Best-in-Class medical practices recognize the importance of these factors and have aligned resources internally or externally to provide access to more key business data, metabolize new disparate data sources quicker, and deliver valuable insights within the window of opportunity to effect positive change.
Best-in-Class medical practices optimize their internal capabilities and skill sets to generate an environment that efficiently collects, assembles and delivers mission-critical insight in a meaningful and practicable way to the person or people who have the ability to affect substantial business performance improvements.
What have you done at your practice to prepare to become Best-in-Class?
Key Pressures Driving Physician Investment in BI
- Inability to identify revenue growth opportunities
- Poor visibility into day-to-day operations
- Slow access / lack of access to relevant information
- Insufficient insight into competitive activity
In many ways most CEOs face the same issues
I’ve been the CEO of a company since 1979. I’ve been married to the CEO of another company for almost 15 years. Before that, he was the CEO of a company for 6 years. Like you, both of us find that even though we are in totally different sectors, we are both concerned with the growth strategy and long term health of our companies. We are also, in our late fifties, and as such, are concerned with exit strategies and planning for retirement in the next decade. His last venture sold for $15 million. What will we do with what we are building when it’s time to start thinking about that apartment in Spain or Bangkok?
Day-to-day fires are dealt with on an ad-hoc basis. We are both active on different community organization boards and committee chairs. Those boards and committees are made up of other CEOs, community leaders, and tradesmen and just good people, much like our employees. Lots of times, people preface questions to us about the longer term strategic issues facing the organization or committee by saying, “you’re in business, you know how to do these things better than us… how do we…”. It feels just as familiar: where’s the data to use as a guide or provide insight?
The ability to find and exploit opportunities for revenue growth, new markets, new products, new services, etc., is crucial for a medical practice company leader. An efficient analytical strategy can support this need. So how can a physician that owns a small concierge practice build one?
Here are some data that you need in order to start collecting BI about your practice
1. Operating profit: Measured as an average of year over year change in operating profit/ EBIT
2. Organic revenue growth: Measured as an average year over year change in organic (non-acquisition related) revenue
3. Customer retention rate: Measured as an average percentage of customers retained over the previous 12-month period.
4. “Good” Employee retention rate: Measured as an average percentage of the good employees retained over the previous 12-month period – Poor performers and laggards detract if you retain them, and training cost money and productivity if you have to keep replacing the good ones because they were recruited away from you by your new market entrant or existing competitor.
The PACT Model
Using business analytics to achieve practice goals requires a combination of strategic actions, organizational capabilities, and enabling technologies
|Inability to identify revenue growth activities||
In my company and my husband’s company, our most important job as a business leader is to define and communicate the corporate strategy that we came up with as CEOs, and transfer the plan to those who are charged with executing against it. In the case of a concierge physician, that includes the biller, the receptionist, the membership sales coordinator, the person assigned to marketing and social media coordination and networking and public relations, your nurse, your HIPAA privacy officer, and probably your spouse or significant other – who is wondering if your strategy includes being home at a reasonable hour for dinner.
Chances are those first four data points are already available to you and you don’t need to buy more technology, equipment, software, or tools. You probably aren’t maximizing that which you already possess.
How to best use the data you already have
With those four as a start, the next key priorities are to enable more data to pervade into more areas of the business, and ultimately allow more of the vital organizational data to be analyzed and visualized.
As consultants, we bring these four questions and data points to every initial consultation. When we ask client physicians for the data among other data to do a practice assessment, you’d be surprised about how many have never seen these reports or used them to consider strategy.
We also bring those next key priorities in the form of a list of things that should be known about a practice. From there, we ask the physician to choose those data inputs that he or she feels would be helpful to move towards that Best-in-Class category. We discuss how each one fits into the analytical process to build strategy.
New clients often articulate that while they have the greatest need for analytical capability, they often have some of the greatest barriers to getting their hands on it. So often, they are the “Chief of Cooking and Bottle-washing”. It is quite possible that when the software selected to run the practice was purchased, no one evaluated the analytical tools for complex financial calculations required for financial leadership that may already be in the system but not currently being exploited to the max. Often when we go looking for it, we find a way to make the system generate the data into a nice periodic report and the doctor says “My billing system can do that?” Probably yes.
How we bring added-value to the existing tools you already have at your disposal.
The key to value measurement in a consultant is what they can do to help you maximize that which you already have at your disposal. Not sell you more “stuff”. We act as coach, mentor and guide.
The puzzle pieces that comprise an efficient analytical strategy are diverse and very often obfuscated. We start out simple. The macro-level vision for BI is achieved by starting with some well-thought out processes that we bring from our experience to help support the collection, transformation, and delivery of your business information in a way and with a frequency to help you make better strategic decisions.
Chief among those processes is the ability to self-assess when we aren’t there, and gain an understanding of where things stand today, and where they need to be in the future. That often involves coaching – and mentoring, rather than doing it for you.
We come in and identify what data sources you have at your disposal today, and what you might need in the future. Then we determine if you already have those sitting inside the billing box and the EMR – just waiting to be asked to produce an output. Sometimes they aren’t connected in such a way that the two sets of data can be “married” into one that helps you make better decisions. If that is the case, we discuss our observation with you, determine if you agree, and if so, help to identify a programmer that is able to dump the data sets into a “bucket” and then use that data to create a report that bridges the two pieces of data into something informative. Then we get them to automate the process henceforth.
Another analysis we perform is to assess how many analytical users you have and what levels of expertise they carry, and how we can tailor the solution to effectively meet everyone’s needs. In most client assessments, money is a big object. We have to be good stewards of what meager budget is available for this. This is tantamount to having a car in college: It has wheels, it runs, but it may not be the most elegant car in the parking lot. It needs to be functional, not fancy. Fancy comes later- if it ever comes. It’s just data, not a Porsche. Best-in-Class medical practices have an iterative self-assessment method and regularity in place. They are also more often likely to have a seamless process from all the parts of the business (costs, revenues, overtime, RVU productivity, payer contract denials, appeals, late payments, refund requests, new patient grown, patient transfers to other practices, delays in appointment access, late appointments, patient satisfaction, clinical outcomes, growth, etc.) that flows to strategic decision makers. We prioritize all those data sets and turn them into one compiled periodic report that is easy to read and actionable. If it isn’t actionable, what good is it?
Best-in-class medical groups also have a way to ensure that the data is transferred to the front lines as a periodic report into their email on the corporate intranet. These reports should be paperless, and get the need-to-know sections that involve the receptionist should automatically be parsed out and emailed to the receptionist as quickly as the office manager with a message that says “see me”, “fix this” “needs improvement” or “great job!”. That way, the good employees “get it” and get busy on their own iterative self-assessments, instead of being cajoled for performance. If they don’t get it and don’t do something to fix what’s broken with a solution that is within the brand standard, then the training that is needed is the brand standard, or some options in the form of coaching. Still no improvement or consistency? It won’t be a surprise when you bid them adieu and bonne chance.
One of the other areas to which we bring objectivity as consultants is the task of coaching the physician executive on how to develop implement and manage analytical strategy as a part of organizational development. This is not something taught to physicians during their training. That’s unfortunate, but it gives a good consultant job security! We teach the executive physician how to assume ownership of the BI needs of the business, and teach a top-down analytical hierarchy. If there is a practice manager or administrator, we teach them to be a BI leader or champion as a back up to the physician executive.
One of my personal favorite activities as a consultant is “silo busting”. In healthcare organizations, so many practices, hospitals and other types of providers experience frustration when it comes to functional silos and the barriers that prevent a practice or a hospital or some other provider organization (I’m talking ACOs here, and similar supposedly “integrated” and “aligned” organizations) from enjoying business process efficiency from a cross-departmental perspective.
For example: membership sales data in a concierge medical practice drives financial forecasting. Financial forecasting drives planning and budgeting for new service line launches new technology purchases or leases, new hires of additional nurses, physicians or practitioners, etc. This never ending eco-system of data begs for a level of integration and sharing across business functions. If you don’t have this in place, you are missing out on some of the lowest hanging fruit to move you closer to that Best-in-Class category.
Making the data more available to multiple business functions, assuming of course the need-to-know and relevant protections are in place, is the first step in the process. But when we teach those folks how to maximize the data and what to do about what it indicates, magic happens. Without that knowledge and skill, the data us still inert and much less useful. There also has to be a centralized place where all the data lives and where trends can be identified to act as red-, yellow- and green-flags. Data has to remain fresh and not be obfuscated by over-elongated periods of measurement. If you wait too long to take action, the data can become useless because it is too old. Best-in-Class practices use shorter time frames for Measurement & Evaluation (M&E), for at least their top strategic priority data, and decide on a regular frequency to get a fully-refreshed picture in an intuitive and visually appealing way.
Best-in-Class practices are also more likely to leverage automated data generation and delivery of key reports. We help clients from small practices to big integrated health systems and ACOs organize a vital business intelligence infrastructure of data capture, assembly, reporting format, and delivery that enables faster and cleaner delivery of critical need-to-know information and insight. In some cases, this means calling in other collaborating firms to bring in Master Data Management (MDM) tools for data cleansing, and enrichment, modeling, and more. In other cases, where money and talent are tight, it means a tune up for that jalopy to reliably get back and forth to class and to work each day.
If you think you’d like to explore what can be done with what you already have in place but may be underutilized, please call us. Chances are, we can do some of the consultative work remotely with proper logins and access to your system after all the NDAs and permissions are in place. Other parts of the consultation must be done face-to-face. If you can’t get your system administrator to give us remote access, all of it may have to be done on site (at a higher cost, of course).
Once we are engaged and under contract, we’ll give you a few tools and checklists to get started on the remote assessment of what’s available, and start digging into your system to see how we can connect the parts to produce useful information from both the practice management system and the electronic medical records system. We may surprise you with what we can get your existing systems to produce from what is already present and purchased without buying additional add-ons. Sometimes, all it takes is for someone to show you how to do the “cool stuff” and set it up for you. Lots of times we find that a software was chosen by a doctor who didn’t realize these reports would be helpful, and in the rush to get it up and running, the practice manager didn’t understand the importance of BI so he or she skipped over that training or module, and the reporting capability is lying dormant in the box. Other times, it was the sales rep that glossed over that part because they were there to get a signature and a check, and not to bother with explanations about “all these other system capabilities that few people ever ask about anyway.” We promise to only ask you to consider buying something new after we’ve exhausted or optimized every feature that your current system(s) already offer.
Let us help you drive insights into day-to-day decisions at a relationship level to find new and innovative ways to grow revenues without raising prices, so you can be in that 20% that ranks Best-in-Class for your specialty or practice model.
[/vc_column_text][vc_call_to_action title=”Is it time to explore better strategies and business analysis for your practice?” button_title=”TALK WITH AN EXPERT” button_link=”http://mercuryadvisorygroup.com/contact/”][/vc_column][vc_column width=”1/3″][vc_column_text]