IR, NCB and remaining profitable
WITH MICHAEL BARISH
Q. With Medicare cuts looming under the authority of IR and the continued threat of competitive biding, what steps should I be taking to ensure that my company remains profitable?
A. There is no question: In the very near future Medicare reimbursement is going to be cut if not by one mechanism than by the other. In order to remain profitable, providers must learn how to operate more efficiently and effectively. Thus they must become low cost providers.
An audit of your business operations is an excellent place to begin identifying areas that can be reengineered to improve efficiency and effectiveness. The audit should include all departments. The key areas that should be scrutinized include the workflow, division of responsibilities, system automation, employee knowledge and staffing levels. As you gather data during the audit process, the information should be compared to the available industry benchmarks. An excellent source of benchmarking data is contained in the annual American Association for Homecare’s Financial Performance Survey. This survey contains comparison data on operating expenses, staffing and equipment costs as well as accounts receivable indicators.
As you identify areas that are producing less than desired results, review the corresponding personnel in regards to their knowledge levels and skill sets, the processes, job responsibilities, and use of business software and determine the cause for the substandard performance. Some possible reasons for the reduce efficiency or effectiveness could be due to lack of training, employees without the proper skill sets for their assigned responsibility, fragmentation and/or redundancy, not optimizing the business software or the design of the work processes. By streamlining your business process and eliminating unnecessary handoffs of paperwork, providing required training, and utilizing your business software effectively, your business office will run more efficiently and you maybe able to reduce the number of employees involved in a process.
Michael Barish is president of Ancor Healthcare Consulting. Reach him at 954-757-3121.