@medman
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The one aspect of business not covered in this course is Cost/Profit/Margin. In the finance section you will learn the basic financial skills and vocabulary but a deeper dive is needed. Our Value Based Care CME course takes a close look at Cost/Profit/Margin and then uses that knowledge to apply activity based cost analysis to your practice. Activity based costing looks at a specific service line, often associated with one or more CPT codes and does a cost breakdown. The first step is identifying your most commonly used codes, or the ones that represent the most revenue. The second step is creating a work flow diagram to outline the steps both from a provider and patient perspective. From there you follow the steps outlined. It you wish to go in that direction, I suggest you complete the program you are currently on and then add the Value Based Care CME class to learn activity based cost calculations. https://meded-stat.com/courses/value-based-care-find-value-in-your-practice-2-0-cme/
We have a nice CME course on value based care available. I will add
the link below. Interesting, a value based care model has always been
a concern in an over utilization scenario. COVID has done exactly the
opposite, created an under utilization of services. Whereas fee for
service practices are seeing major revenue cuts, a value based
compensation model would be revenue neutral. Revenue neutral means
more profitable since your variable expenses should decrease with
lower utilization. So why are we still wary of value based care
models. The simple reason is that we never have had an accurate
handle on our costs. It was like that when I led a practice and
nothing much has changed. First we never characterize our practices
as profitable and second we had no process in place to understand
where the profit was generated. What was the net income of your
practice last year? Was it profitable, and by how much? In essence,
how is your practice doing financially? You should be able to define
it with a number, like every other business on the planet does.The value based care course sorts all of this using an activity based
cost analysis methodology. In plain language, it answers the question
of how profitable are your 12 most common CPT codes, and how can you
improve that profitability. It is Sunday, so that is all I will give
you. I have to go back to watching the hockey game. Next newsletter
will take a closer look and discuss how physician compensation enters
into the picture. In the meantime the link to the VBC course is
below.https://meded-stat.com/courses
/value-based-care-find-value- in-your-practice-2-0-cme/ I will add this newsletter to the Finance course discussion board, I
welcome any comments there, or send me an email. I love hearing from
you.
Take Care
David JWhen I first started getting involved in online education I had a mentor from a graduate program in education. We co-produced an online course, Business and Finance in Academic Medicine. It was designed for physician residency directors who were earning a Master’s in Ed. to improve their teaching skills. By popular demand, they asked for an elective on business. My mentor introduced me a a wealth of literature on learning, best practices, and it was reviewing the studies that I realized the limitations of single face to face encounters. Elementary through high school is all face to face, reinforced by homework, repetition, and testing to produce an effective knowledge transfer.
About face to face. As a surgeon I always thought myself very proficient at education and explaining the intricacies of a surgical procedure to patients. Patients nod and react well to in person discussions and I was very happy with myself. Then I discovered the efficacy of face to face education, 50% comprehension and 25% retention after one week, independent of the educator. The key factor in education that is retained is repetition. Our face to face is a one off. If may be different for each patient. Not much chance exists to repeat the message or test for comprehension and yet we devote less and less resources every year. How much time did EHRs take away for your education efforts.
We are working with this platform to education patients. Check out these links, knee and hip replacement patient education courses. Easy access, pre and post testing, and readily available for review. Guess what the most common device is? These are 60 – 70 years and their favorite device is an iPhone. https://meded-stat.com/courses/hip-replacement-patient-education/
https://meded-stat.com/courses/total-knee-replacement-patient-education/
We have a course in value based care that teaches activity based cost analysis. It takes your top revenue producing CPT codes and breaks them down to discover hidden efficiencies and costs. 20% of your activity produce a majority of your revenue, so it is not as intimidating as you would think. As for drug pricing. Do you know how drug prices are set. I didn’t when I was in practice. We also have a course in Medication Compliance which spells out the “hidden” process and give you a solution to reducing your patient’s drug costs. My ENT, a close friend who I have played hockey with, diagnosed an external Otitis and prescribed brand name otic antibiotic solution. I took a paper script to CVS and found it costs $250 for 10cc of medication. I refused to pay and went home. After an hour on the computer I found a manufacturers coupon that reduced the cost to $45. I also found an alternative that cost $25. I am sure he simply wrote a script for what he thought was best with no consideration of the cost. That process results in more than 30% non-compliance in picking up a script. It inspired me to investigate the drug pricing system and use the practice improvement methodology to offer solutions. https://meded-stat.com/courses/medication-compliance-truth-and-consequences-1-5-cme/
This is a good example of listening to our customers. I for one would love to have access to telemedicine. I never really loved going to the office.
It will take strategy and business planning to successfully integrate it into a practice. We need to make sure it is profitable otherwise it will just make everything else that much harder. We have a course on Value Based Care, that uses an activity based cost analysis to find value in a practice. Telemedicine will have to undergo that kind of scrutiny before I would allocate resources in that direction.
I think the Mayo addresses the heart of the problem, which is the business process under which we all work. Good leaders who operate under a “Quality Leadership” environment see much less burnout. I wonder how many of the “good” leaders have formal training in leadership? My bet is too few and yet somehow they figure it out. No doubt they could all get better and then who knows the impact on burnout. Leadership is all about providing a sustainable, empowering, fulfilling, engaging work environment. It is not so intuitive, I didn’t figure it out until I learned it in business school. But then again isn’t that why we learn?
Easy to send someone to “mindfulness” training, which is only a band aid, when what is needed is good accountable leadership.
The executive see the world in a business framework. Physicians see the world in a human framework. Executive will never ever have a chance to care for patients. But you can gain a working knowledge of business. It is up to us to share our experience in the front lines in the language of business. Strategy discussions, resource allocation, practice improvement activities initiated by those of us who see patients every day and conducted under a business framework is the best way to bring what you do every day to those who will never know what it is like to care for patients. You will come out of the other end of this program with a new language new mind set. Imagine if all of your colleagues had the same. I can only imagine the power of that.
You question is really about engaging the patient. It is getting harder and harder to establish a trust relationship with patients. It starts with the employees in your practice. Do they feel empowered? Employee engagement in their work is the leading indicator toward patient engagement. I would start there. Next up is patient education. Patients have so many sources of information available to them, but it doesn’t mean they are becoming educated on their health issue. We might acquire education resources that are easy for them to access, and then followup to make sure they are doing their homework. We are losing touch with best education practices. We used to think the face to face education was the best. Not so, online technology has surpassed the traditional modes and patients at all ages prefer to use their connected devices to learn.
Solutions in any organization can be bottom up despite the control exerted by the admin. It can all start with a single provider. I placed an extra course in your account on Medication Management. How can we change what we do every day and reduce non-compliance dramatically. In the third course on practice improvement, you will see how small incremental change can add up to something remarkable.
I never had any in my career either. Luckily, my first posting our of my military residency, my chief resident when I was a PG2 was a senior staff. Carla took me under he wing and kept an eye on me. Informal mentor better than nothing but a far cry from a formal mentoring give and take experience described in the last section of the program.
Great questions, I love that you want details. I wanted them as well, so I was able to obtain both of the physicians in question P/L statements. Here are the differences.
We can break it down as an income statement.
Revenue
wRVU – approximately the same
Revenue – approximately the same
Collections – the partner’s department uses their own department billing. It is more expensive 8% of collections than the Dept of Surgery which uses hospital wide billing 4% of collections. The partner’s billing is also more efficient at collections and collected close to $75,000 in payments for the same wRVUs. They are the only department using their own billing and one can now see why.
Expenses
Malpractice – surgeon expenses $40,000 more than her partner. The hospital is self pay malpractice, meaning they expense “premiums” but it is essentially a non cash item hospital wide because they do not have an outside insurance accept for re-insurance for very high awards. The MP expense arbitrarily increased her expense and lowered her net income.
Dean’s tax – $25,000 payment to the hospital levied by department. The Dean’s tax for Surgery was higher than her partner’s department.
There were several other entries on he P/L statement that were higher than her partner. The structure of the income statement seemed to be designed for her to fail as far as profit/loss. You can always say that it is all accounting and not something to define how productive she was except for the fact that they were using her net income value to support her “numbers” being down. It was the first time in all the years that she worked that she took a deep dive into the statements that she had been given every year.
There are more details, but this is a great example of how the financial statements often time shout out the truth, but it is up to us to hear it.
Wow!! Clearly a major leadership deficit in that organization. The negotiation course, the last in the program, addresses sizing up an organization and deciphering its culture among other things. I am so sorry that happened to you. I can’t imagine how vulnerable you felt at that point in your pregnancy. One thing for sure, as a woman physician, you have learned to be more competent than most and tougher too. I sense that you recovered from that insult and moved on. This program will deliver some ammunition to fight poor leadership in the unemotional cool language of business. Thanks for being in this class.
Was the decision to close for 2 weeks made between you and your partner or was it the product of a team that had access to all of the same information as you? What is the decision making process now and who is represented?
The solutions you suggest here have “Quality Leadership” written all overt them. Candor and transparency should be embraced. Decisional teams should be small but representative and if given the chance can be very nimble in response to a rapidly changing environment. Granted there will be some delay but a decision coming from the team will have greater buy in which is ultimately what is important. Decisions that are centrally created are fraught with variation and work arounds are destructive.
Good Morning everyone on this sunny Sunday here in Maryland.
I sent you a leadership case study last week and wanted to provide some follow up. The clinic in question has added screening outside the facility that includes temp measurement. It is being preformed by a med tech, not a nurse but they are using a script as a basis for the screening. . The nurse practitioners have been pulled to await the projected surge of COVID cases in the main facility. The in person and telemedicine volumes have not been reduced and will be absorbed by the physician staff. No schedule changes, they are double booking appointments.
I wanted to address a question on the leadership pretest that seems to be very commonly answered incorrectly. The incorrect answer, I listened carefully to my employees and then I made the decision. The correct answer, They do the work and I let make them make the decision. Understandably you would not follow this lead for major strategy or capital budgeting decisions. But even those decisions should be made in a democratic team environment with stakeholders representing the decision itself. The point, is that when you have an opportunity to decentralize decision making, productivity will increase. In a business sense, productivity doesn’t just mean more work happens. It is all about efficiency, quality, safety, and engagement. You get many gifts with a decentralized decision process. The Ritz Carlton, the leader in leadership process, allows each worker a $3000 budget to improve the work process without pre-approval. The result is the most engaged work force in the hospitality industry. I encourage you to read the Harvard Business Review article in the reference section of “Quality Leadership”. It describes what is so often the case in healthcare practice and what happens when quality leadership is used. It was game changing so me.
That is it today, short and sweet. You will find this case in the discussion forum if you would like to comment.
Take Care everyone, thanks so much for the time you spend with us. If you appreciate what you are learning invite a friend or colleague. Physicians controlling how the work gets done is the key to good care. But you need as many in the game with the right skills to make a difference.
Take Care
Dr. J
