Reporting for efficiency
With Michael Barish
Q: My business software produces numerous reports, many of which are very detailed and time consuming to review. How can I change my reporting to produce the information that will allow me to analyze my business more efficiently?
A: The first step is to list all reports that are being generated on a daily and monthly basis. This list of reports should be reviewed to determine if management is using the reports and/or if they are effective for managing the various business components. Discontinue running reports that are not useful. After you have determined what reports are necessary create a daily and monthly processing control sheet for your computer operator to follow as they are performing the processing.
The key information that should be examined at month end includes revenue, cash, adjustments, held revenue, accounts receivable and open orders as well as a breakdown of revenue and gross margins by product category. This information will enable you to perform DSO and held revenue DSO calculations and make comparisons to the previous month and the same month of the previous year for trending and budgeting purposes. Management should begin by reviewing report summary pages and only when there are discrepancies identified is it necessary to review the report detail.
It is also beneficial to perform a monthly breakdown and analysis of revenue and payments by payer. This is especially important if a portion of your company’s business is derived through contracts with managed care payers. This will allow you to be proactive in identifying and addressing issues such as reduced payments, increased time for payment of services, and high denial rates. It may also point to a managed care payer that may be on the verge of insolvency and thereby allow you to take the appropriate steps to limit your exposure.
— Michael Barish is president of Ancor Healthcare Consulting at 954-757-3121.