Having analyzed where the private practice is both in terms of outstanding accounts, it is important to have a structured and rational action plan.
Why do it this way though?
On numerous occasions, MHM has been called in when previous attempts to resolve an accounts issue have failed. The number one cause of this failure is the tendency to mistake movement for action.
For example, one group of surgeons had previously ordered all outstanding invoices be resent to insurance companies and self-funders. This was always doomed to fail.
It didn’t take much to work out that if invoices hadn’t been paid in the first place as they were wrong, sending them out again wouldn’t achieve anything. It didn’t.
If you wish to reduce the amount of money you are owed, the first thing you should do is to ensure the amount does not get higher!
So what now?
1. where are you now?
If you do not know precisely where you are now, you will NEVER reach your destination. Do not think you know where you are. Make sure your core data is robust, up to date and accurate. Then keep it that way! Otherwise, over time you will go backward.
2. Invoicing.
You MUST ensure your invoices are completely accurate. INVOICE RIGHT = GET PAID RIGHT! This means checking your CCSD codes, checking the fee for each code across all insurance companies, checking you’ve got all the right patient details, etc. INVOICE RIGHT = GET PAID RIGHT!
3.Payments.
There is simply no excuse for not posting payments to your debtor’s ledger.
If you do not, then very rapidly your data will become useless. Recently, a consultant surgeon claimed to me posting payments to a sales ledger was not as important as chasing invoices for he was in his words “more interested in what hadn’t been paid than what had”.
This almost certainly was the origin of £’000 worth of unpaid excess and shortfalls which he was horrified to discover existed but that he was completely unaware of.
4.Excess / Shortfalls.
If payments are monitored then identification of excess/shortfalls is quicker. It was also put your practice in the position of being able to do something about them. That must mean contacting the patient and having a robust process to ensure excess and shortfalls are collected. Failure to do so WILL cause all sorts of problems for you.
In my experience, it is much, much better to spend time investigating the above four areas BEFORE implementing an action plan.
Do not mistake movement for action.
It literally is similar to building a house. If the foundations are not solid, the chances are the house will collapse. Yet some consultants make the mistake of “actioning” an accounts issue without establishing what really is the cause. Do not become one of them!
The bad news is whilst the original identification and investigation of each step should be allowed sufficient time to be completed correctly, as they impact on each other so much, implementation of an action plan, should be done all at the same time.
The ultimate management challenge – how to change but stand still all at the same time!
If you know what to look for and have devised action plans before, this whole process can take around two weeks. If you do NOT know what to look for and devote enough dedicated resources (and there are many, many more points than have been covered in four blog posts) allow for about 3 months worth of trial and error.
Most likely if you are experiencing issues with getting paid, not devoting enough dedicated resources caused the issue in the first place.
pete@medicalhealthcaremanagement.co.uk