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Fixing healthcare revenue leaks

Small and medium size physician practices have to adjust a suite of business practices to the new healthcare landscape

A recent NPR story noted that physician practices have the lowest revenue growth in the healthcare space. Typically resistant to large changes but hit hard by the new reimbursement rules put in place by the Affordable Care Act, small and medium size physician practices have to adjust a suite of business practices, from managing relationships with payers to learning how to handle online reviews, to the new healthcare landscape.

The referral kerfuffle

"All spending in healthcare is done under the order of a physician," said Jeff Butler, founder and CEO of Privia Health. He says physicians are the "quarterbacks" of a care team, getting patients to the specialists they need to see. When docs have appropriate access to data and scheduling tools they can help facilitate those transitions within a provider network. What makes this picture into a money-loser is that physicians aren't seeing revenue from a lot of these referrals.

"More than 25 percent of orders and referrals from employed providers leak out of network," said Joel French, CEO of SCI Solutions. French says an order that gets entered into an electronic medical record (EMR) still is often printed out, faxed to the specialist for scheduling, and given to the patient — leaving it in their hands to perpetuate the care within the network. "When you investigate how they work, you'd be stunned," French said, noting that even the best organizations out there employ "1980's scheduling practices for world class care."

[See also: Revenue Cycle Management.]

The way to keep those pesky lost referrals from getting away? French says better workflow management and follow-up with patients. Those 1980's scheduling practices need to go: French notes that only 54 percent of faxed referrals get scheduled. That figure jumps up to 83 percent when the referral is transmitted electronically.

Are ratings underrated?

Most people don't rush online to write a positive review, says Jeff Shaffer, a founding investor of Review Concierge, a service that helps doctors navigate the online review landscape. Negative experiences motivate a review most often, and usually have nothing to do with the practitioner. "Oh, our receptionist is mean or the wait times are bad," said Shaffer of typical complaints — solvable problems which rarely come back to the physician. Another common complaint: "I got a bad bill, and therefore the doctor sucks," summarized Shaffer. "But the doctor doesn't even have control over that!"

So how important are these reviews? "Imagine you put in $10,000 for an ad in a magazine but if your Google results are all bad reviews," nobody will want to follow through with an appointment, Shaffer said. Numbers back this up. Shaffer says if, on average, 80 to 85 percent of people keep appointments for a referral, those numbers will drop to 40-45 percent if the doctor has negative reviews online. Bottom line? People do their research and online opinions matter.

Keeping those reviews in line takes a bit of work. First, Shaffer says to "respond politely" to all bad reviews online. Usually the complaints are actually useful feedback and can even be solved. Secondly, knowing what review sites are out there and sending happy customers to them helps boost a practice's online presence. Shaffer suggests handing happy patients a card with a link to a landing page that can direct them to the appropriate review sites.

When every dollar counts, a lost referral or a bad online review can impact the profitability of a medical practice. So plug those revenue leaks!

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