I was asked to co-present for a Medical Group Management Association (MGMA) certification course on the topic of Financial Management in Healthcare. The session used to be two days, apparently had been reduced to one. Explaining financial concepts is a pretty dry subject – condensing it into a time slot required for the webinar takes serious restraint – and why not…throw in technical difficulties even after the sound checks were successful.
Walking through the entire revenue cycle wasn’t a problem…but it was more of a jog. I paced myself at the start – since that is where the critical part is…scheduling and registration – getting the information from the patient entered correctly the first time before they hang up the phone and before they check in for their appointment. I made a handout for my clients that show this decision tree. Electronic verification of eligibility is the best practice for up-to-date information and should be run prior to the patient coming to the appointment to ensure their insurance coverage and most of the times these verifications will confirm co-pays or deductibles in real-time.
Discussion on prior authorizations came into play. It was interesting, the other day, I came across a pre-registration form making the patient take responsibility for what was on the form – including calling the insurance company asking if particular procedural codes (in that circumstance – behavioral health) were a covered benefit. That is not a prior authorization – however, it is getting the patient involved with the financial management of their care, so they are aware of what goes on to make their care happen. In my opinion – that medical practice should be given a Platinum Star!!
If a medical practice has the insurance information and the prior-authorization, co-pay, deductible information up-front the back end billing and collections should be a breeze. Billing, however is only a sliver of financial management in healthcare.
The other topic I touched on for the webinar was financial statements for medical practices. There are income statements (profit/Loss statements), balance sheets, and equity statements. These statements need to be reviewed monthly and compared to statements from previous months or the previous year in order to know if the practice is healthy, growing, struggling, etc. These statements may also have other data such as volumes, number of patients seen, RVUs, number of business days, and other pertinent information to make the financial data comparable period to period. Your financial statements are living breathing documents, as your practice goes through time – these documents tell your story: vacations, medical leaves, new providers, loss of major employer in town, etc.