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3 Threats to Medical Practice Revenue This Year: How to Fight Back

Last year saw a changing healthcare landscape with health insurance reform and millions of newly insured seeking coverage. 2015 is bringing many more big challenges for physicians, including the transition to ICD-10 in October, and increasingly difficult and costly meaningful use standards. Are you and your medical practice ready?

Here are a few of the top challenges to medical practice revenue this year, and some handy tools and resources to get you ready to fight back.

High Deductible Plans – According to Health Leaders Media, the rise in high deductible health insurance plans is the top revenue challenge for physicians this year. Why? High deductible plans increase the risk that patients won’t be able to pay their medical bills. With more consumers shopping on health exchanges, many are choosing high deductible plans without fully understanding what the cheaper premiums mean. When an unexpected injury or condition puts a patient in need of more extensive care, they could find suddenly find themselves with a hefty out-of-pocket bill they weren’t able to budget for.

Employers are also increasingly cost-sharing with employees to lessen their own financial responsibility for healthcare. 18% of employers only provide a high-deductible plan, and a whopping 85% are either considering or have already changed health plan options to increase employee cost-sharing.

How to Deal. Ok, there’s not much you and your staff can do about a rise in high-deductible health plans. But, there are ways to improve your payment collections. Since most of the risk happens when patients don’t understand their insurance plans, have office staff focus on educating patients about their coverage and about your office’s payment options and procedure costs. All staff should be able to provide this information if a patient asks. You should also have front-office staff remind patients about their copays when they call with appointment reminders.

Being a budget-conscious physician can also make a big difference. Base your suggested treatment plans not just on what’s available, but what fits with your patient’s budget and insurance plan. Give patients an idea of what procedures will cost, so that they can better budget for care. Consider this approach for all patients, but especially for patients on high-deductible plans.

For more practical tips on how to approach patients about healthcare costs, check out this great article from Medical Economics.

ICD-10 compliance – Everyone’s talking about ICD compliance this year with that looming October deadline fast approaching. And many practices are far from ready. A physician survey done by Medical Economics in November of last year found about half of physicians were not ready for ICD-10.

CMS has warned that claim denial rates could spike between 100% to 200%. As physicians and medical staff are still adjusting to the new codes, they’re more likely to make coding errors. Payers who aren’t on-board in time may not have payment determinations for all the new codes. Additionally, the transition to ICD-10 will intensify the already growing administrative burden on physicians, especially those working in small, independent practices. Half of physicians surveyed by the Physicians Foundation estimated ICD-10 would lead to severe administrative burden.

How to deal. Medical practices will need ample training to prevent the financial fallout from rising claim denials and loss in productivity. While you might think more training or new software is too costly, preparing for the transition now and spreading the resulting costs over the year won’t put your practice at the same risk as waiting until the last minute.

Here are a few valuable resources we found on how to get your practice ready for ICD-10:

 Administrative Burden

With all of the recent changes in healthcare, it’s not surprising that administrative burden is overwhelming doctors, especially physicians in independent practice.  70% of doctors are spending more than one full day of their work week on paperwork. Instead of focusing on practicing medicine and interacting with patients, doctors are spending approximately 20% of their time at their desks. A recent survey by the Physicians Foundation reports 81% of physicians are already overextended, and 44% are considering measures to reduce their hours and patients.

Dr. Michael Murphy, CEO of ScribeAmerica estimated that there will be about a 25% drop in productivity among medical practices as they navigate the mounting administrative burden this year. While it’s hard to quantify lost productivity in terms of cost, it doesn’t take an MD to see the revenue threat here.

How to deal.

While administrative burden is inevitable as your practice adjusts to new technology and a new stage of meaningful use attestations,  there are a few things you can do. Dr. Ejnes, an internal medicine physician and a past board of regents chair for American College of Physicians, has some advice to boost productivity by ensuring you’re working at the top of your license:

  • Have medical staff fill out time-consuming prior authorization forms for procedures like advanced imaging. Make sure you spell out the rationale in the patient’s EHR and check the form before submitting.
  • Use a medical assistant, or even clerical staff to complete screenings required by meaningful use and “pay for performance” programs. See how Dr. Ejnes did this in his practice.

While we covered tips and tools for a few of the major threats to practice revenue this year, physicians will need to prepare for many more challenges in 2015. To arm yourself for battle, check out this exhaustive, invaluable article from Medical Economics on the top 15 challenges for physicians in 2015. You can also use our list of six New Year resolutions for physicians to plan out revenue-boosting goals for the year.

Now you tell us: What’s the biggest challenge to your practice revenue this year?

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