What are better performing medical practices doing better than their peers?


Medical practices deemed “better-performing medical practices” by the Medical Group Management Association’s (MGMA) annual Performance and Practices of Successful Medical Groups report consistently excel in four performance management categories:

• Profitability and cost management
• Productivity, capacity and staffing
• Accounts receivable and collections
• Patient satisfaction

High performing practices in the annual report demonstrate management behaviors that may be the key to their success and sets them apart from other medical practices:

Profitability and cost management

In this area for example better-performing medical practices have less bad debt due to fee-for-service (FFS) activity per full-timeequivalent (FTE) physician. These groups have approximately $6,900 to $14,000 less in bad debt than other practices. It has also been my experience the really good medical practices consistently keep their overhead below MGMA survey medians.

Accounts receivable and collections

High-performing practices in this category regularly report collecting their receivables more quickly than their peers. They have only 7 to 10 percent of their Total accounts receivable (A/R) in the 120+ days category. In contrast, other practices have 19 to 35 percent of their total A/R in the 120+ day category indicating that strong cash flow is crucial to the success of any practice. Additionally, the better-performers reported collecting 90-100 percent of copayments at the time of service.

Productivity, capacity, and staffing

Better-performing practices in this area implement operational efficiencies to ensure strong provider productivity, including employing nonphysician providers such as physician assistants, nurse practitioners; as well as ensuring efficient patient flow through the practice. In fact, better-performers report higher support staff and ancillary support staff costs per FTE physician, ensuring optimal staffing to leverage physician time.

So when your office manager presents payroll checks for you to sign and you think: “That’s a lot of my money I could take more home if I didn’t have so many staff,” the “on top” practices prove that kind of thinking just plain wrong.

Patient satisfaction

Groups excel because they use formal patient satisfaction surveys in which they request feedback on appointment availability, professionalism of the staff, wait times, and the patients’ overall experience at the practice. These practice not only care of delivering first class patient satisfaction, they listen to what patients report to constantly evaluate and improve practice operations. The feedback is also used to educate physicians and staff about behavior based on survey results.

Looking closely at medical practices that comprise the ‘better-performers’ group, you notice a pattern - It is important for physicians and staff to communicate well and focus on the needs of their patients. Being a successful medical practice is a process of having the right people with the right training doing the right things at the right time.