Conducting a Medical Conducting a Medical Practice AssessmentPractice Assessment
PurposePurposePurposePurpose
• To determine the readiness of the medical practice to receive payment by a given reimbursement mechanism– i.e. capitation, discounted FFS
Assessment ItemsAssessment ItemsAssessment ItemsAssessment Items
1. Number of active clients
2. Average visits/client/year
3. Average number of new clients/year
4. Total referrals from organization/year - Principal resource(s) employed
5. Total clients referred to organization/year
- Principal source(s) of referrals
Assessment ItemsAssessment ItemsAssessment ItemsAssessment Items
6. Average referral income/client/year - Principal source(s) of income
7. Average number of in-office ancillary service units/year
- i.e. medical emergency
8. Percent (%) active clients/source of payment
- i.e. FFS, private pay, commercial insurance, Medicare, Medicaid, managed care, etc.
Assessment ItemsAssessment ItemsAssessment ItemsAssessment Items
9. Average length of time for receipt of A/R - Information subsets: collection rate, bad
debt write-off, time difference between date charge generated vs. data billed to payer, ratio of denied claims, etc.
10. Listing of businesses & organizations employing significant number of employees who refer to organization for clinical services
- Significant number = 100+
Assessment ItemsAssessment ItemsAssessment ItemsAssessment Items
11. Average number of outpatient clients seen/week
- Principal source(s) of referral
12. Average number of inpatient/residential admissions/week & average LOS
13. Average number of hospital consults, physician, psychologist, social
worker/week & principal source(s) of referral
Assessment ItemsAssessment ItemsAssessment ItemsAssessment Items
14. Principal CPT codes for which charges are generated & corresponding RBRVS value - Number performed/year
- Average charge/treatment
- Average allowed charge/year
- Average reimbursement/procedure
Assessment ItemsAssessment ItemsAssessment ItemsAssessment Items
15. Comparison of cap rates offered to organization with cost of providing services to clients
- RBRVS
16. Relationship of cap rates to total revenues generated/year
- If it is a risk assumption contract, must be 20+%
Assessment ItemsAssessment ItemsAssessment ItemsAssessment Items
17. For MCOs employing a withhold, how is it structured
- Policy regarding withhold for PCP & specialist
18. Productivity of direct services staff - Average time spent in direct service
19. Results of ongoing client satisfaction surveys
Assessment ItemsAssessment ItemsAssessment ItemsAssessment Items
20. Impact studies of capitation - For each cap rate offered, convert monthly revenue stream to FFS equivalent CCF
- e.g. 50K ss x $0.50/ss/month = $25K/month
Month #1 = $25K/100 ss = $250/visit rec’d
Month #2 = $25K/2K ss = $12.50/visit rec’d
BenchmarkingBenchmarking
Benchmarking DefinedBenchmarking DefinedBenchmarking DefinedBenchmarking Defined
• Collect data
• Analyze data
• Trend data
• Compare data
• Identify best performers
Internal vs. External Internal vs. External BenchmarkingBenchmarking
Internal vs. External Internal vs. External BenchmarkingBenchmarking
• Internal Benchmarking– Intra- or interdepartmental
• External Benchmarking–Best industry performers
–Reluctance of some organizations
–Confidentiality agreements
What to BenchmarkWhat to BenchmarkWhat to BenchmarkWhat to Benchmark
• Comparative professional liability claims –Number of incidents/year
–Number of PCEs/year
–Number of claims/year
–Number of lawsuits/year
What to BenchmarkWhat to BenchmarkWhat to BenchmarkWhat to Benchmark
• Comparative PL claims (cont.)
–Number of closed cases• With settlement or judgment• Without settlement or judgment
–Amount(s) reserved
Benefits of BenchmarkingBenefits of BenchmarkingBenefits of BenchmarkingBenefits of Benchmarking
• Summary reports–Tracking & trending
• Average costs incurred as a function of claims
• Legal costs vs. plaintiff costs
• Number of claims/insured physician
• Number of claims/insured bed
• Number of claims/1,000 patients
Benchmarking Leads to Benchmarking Leads to StudiesStudies
Benchmarking Leads to Benchmarking Leads to StudiesStudies
• Frequency of claims–Aggregate stop loss
• Severity of claims–Specific stop loss
Ultimately…Ultimately…BenchmarkingBenchmarking Control CostsControl Costs
Ultimately…Ultimately…BenchmarkingBenchmarking Control CostsControl Costs
Risk Management Areas Risk Management Areas Applicable to BenchmarkingApplicable to Benchmarking
Risk Management Areas Risk Management Areas Applicable to BenchmarkingApplicable to Benchmarking
• Employee satisfaction as a function of education & training opportunities
• Risk financing cost comparisons
• Workers’ compensation claims as a function of implementing an EAP
• Infection control as a function of incentives for an infection free environment
Risk Management Areas Risk Management Areas Applicable to BenchmarkingApplicable to Benchmarking
Risk Management Areas Risk Management Areas Applicable to BenchmarkingApplicable to Benchmarking
• Incident reporting comparisons per quarter
• Productivity measures as a function of incentives for production of billable services
• Patient satisfaction as a function of compliance with organizational quality standards
Risk Management Areas Risk Management Areas Applicable to BenchmarkingApplicable to Benchmarking
Risk Management Areas Risk Management Areas Applicable to BenchmarkingApplicable to Benchmarking
• Patient complaint resolution
• Safety & security compliance
What Must Be in Place to What Must Be in Place to Facilitate Benchmarking Facilitate Benchmarking
ProgramProgram
What Must Be in Place to What Must Be in Place to Facilitate Benchmarking Facilitate Benchmarking
ProgramProgram
• Administration support is essential
• Must determine in advance what activities or processes are to be benchmarked
• Determine processes within activities & processes being benchmarked
What Must Be in Place to What Must Be in Place to Facilitate Benchmarking Facilitate Benchmarking
ProgramProgram
What Must Be in Place to What Must Be in Place to Facilitate Benchmarking Facilitate Benchmarking
ProgramProgram
• Determine who performs activity or process well
• Develop data collection method(s)
• Compare performance against a standard
• Determine changes required
What Must Be in Place to What Must Be in Place to Facilitate Benchmarking Facilitate Benchmarking
ProgramProgram
What Must Be in Place to What Must Be in Place to Facilitate Benchmarking Facilitate Benchmarking
ProgramProgram
• Plan ways to implement changes
• Monitor results of changes which are implemented