As we roll into 2023, let’s prepare your practice to navigate recession disruption. We can do this by looking at best practices around technology, data, and planning.
Over the last three years of the pandemic and throughout its aftermath, many of our clients continue to face challenges related to staffing and providing optimal patient care. It’s critical for medical and dental practitioners to focus on their business and how they can better strategize for the year ahead. It will be pivotal for practices in 2023 and beyond to be prepared, and to make the appropriate investments, so that they continue to build upon successes they’ve had in the past.
Technology as an integral investment
We live in a world that revolves around technology — it controls what kind of information we’re collecting, how we’re protecting that information, how we’re using that information to plan, and ultimately how efficient we are as a practice.
Last year set a record for healthcare data breaches and that data is becoming more valuable as time goes on. Cybersecurity is more important than ever in healthcare because there is so much more sensitive patient information that needs to be protected. It is crucial that your practice has a strategy around protection of data, and you need to make sure that that strategy is kept up to date. Data protection takes lots of resources and it’s a team effort that should be part of your daily operations. Make sure your team has appropriate data security, that training policies and procedures are well documented and understood, and that leadership is demonstrating buy-in and adopting best practices as well.
If you don’t know what you have and where it’s stored and how it’s used, you can’t protect it and you certainly can’t respond well when there’s an issue. Make sure you’re staying up to speed on regulatory changes and the available technology. When you know what’s going on in the industry, you’ll be better positioned to adopt best practices.
Operationally, make sure your technology is up to date with your hardware and software. When budgeting, have a specific line item to recognize the investment in your technology on an annual basis. Technology helps give you the ability to deliver competitive services and attract new patients. This can also help reduce costs, help cut down manual processes, reduce mistakes, increase communication, and save time and labor.
Good data is essential
Do you know the first data point healthcare practices should look at? An easy place to focus on is accounts receivable — if you do not understand your accounts receivable and your turnaround time for collection, you cannot plan your cashflow accordingly. Here is where you can start:
- Know the number of current/active patients. This allows you to schedule accordingly and ensure appropriate staffing levels.
- Know where your revenue is coming from. This helps you understand your cashflows and budget as all payers have different payout speed and rates.
- Know the percentage of patients coming in with insurance, and the different kinds of insurance. Payor audits can come at any time and if one payor counts for a significant amount of your revenue, you could be negatively impacted.
- Understand your reimbursement rates. Evaluating which insurance companies will be part of your practice make-up helps you accomplish this.
- Look at your top 10 CPT codes. This will help you compare the costs between payors.
- Review your fee schedule. Do this on an annual basis to capture any insurance money left on the table.
- Review your contacts. You may be able to can get a higher reimbursement rate by leveraging your volume.
Take the time to know your data to have confidence in your decisions rather than making them on the fly.
Failing to plan is planning to fail
Having a good plan in beneficial, but actively developing the plan takes time and investment to make it meaningful. What is the first thing you should do to plan 2023? The integrity of your data is as important as the integrity you have as a provider. Use the good data you have pulled to make your budget. Take the information from your practice management system and your financials, combine them to create a one-stop visualization to help your planning be meaningful. Then think about the events coming in the next year — associate maternity leaves, potential practice expansion, any large purchases – and plan for those events in your budget.
When facing a potential recession, how do you plan? Remain strong, take care of what needs to be taken care of, and have access to capital whether it’s a line of credit or investments, and invest in technology.
Also be sure to monitor all payors and your revenue cycle. Monitor your expenses and budget. Work on our business, not just in your business. Make high-level management and operational decisions to propel you to the next level.
Download this checklist today to maximize your potential in 2023