Physician practices continue to feel the pressure from increased regulation, increased overhead expenditures, and decreased reimbursement. While physicians are used to the traditional fee-for-service models, payors continue to develop new models that incentivize efficiencies and quality of care. To benefit from these new payment models, physician practices must continue to find new, innovative ways to stay ahead of the financial curve.
More and more I hear practice leaders expressing their frustration with what they “have to do” versus what they “want to do” with their practices. I am seeing newer physicians seeking employment instead of wanting to start or run their own practices due to what they perceive to be overwhelming regulatory burdens and less autonomy in running their practices. This doesn’t have to be the case.
Many practices are surprised to learn that there are ways to increase revenue that don’t involve increased office hours and seeing more patients. Below is a brief summary of some strategies that physician practices may consider employing to increase revenue by working smarter, not harder.
- Buying and Selling Physician Practices. It is imperative that practice owners think about their end goals. Mergers and acquisitions can be lucrative in the healthcare space for buyers and sellers. The key is getting your business into a sellable or scalable model and standardizing policies, procedures, and processes among locations. The more you can scale your practice including number of patients and providers, the more leverage you will have whether buying or selling, including the increased ability to leverage better payor rates or attract private equity.
- In-Office Ancillary Services: What are the services your practice is currently sending to other providers that it could do in- house? Labs, imaging services, and therapy services are just a few examples of in-office ancillary services that can be added to a practice to help increase revenue. You are going to order these services anyway, so why give away the fees to a third party provider?
- Telehealth: More and more reimbursable codes for telehealth services are becoming available. Implementing telehealth can be a great way to efficiently see patients without having them physically come to your office. This can greatly increase your practitioner productivity, patient satisfaction, and patient compliance.
- Ambulatory Surgery Centers (ASCs). Ownership in an ASC allows surgeons to share in the facility fee for surgeries where they would typically only be paid for their professional services. In addition, ownership in a brick and mortar ASC means ownership in real estate as well, which can generate its own revenue stream, and gives you something to sell if ASC operations cease.
- Intellectual Property Development and Protection. Developing strategies to allow physicians and staff to be innovative in creating new products, processes, and services, while offering financial assistance opportunities and simultaneously protecting intellectual property rights can be a valuable asset to a physician practice. Practices may consider developing an intellectual property development program that will provide opportunities for its employees to be innovative and develop new products while offering them financial incentives to do so. The practice also benefits by owning the intellectual property rights to the new products, processes, etc. and can earn money by licensing the use of these newly developed products and processes outside of the practice.
- Concierge Practices. In light of decreasing reimbursement rates, concierge practices have become a popular strategy to allow physicians to decrease their workload while increasing reimbursement and providing exceptional patient care. The model involves having patients pay a VIP services fee to access providers 24/7 and can be provided in an office or house call setting. The VIP fees allow providers to be more accessible to their patients and allows the practice to take on less patients.
- Equipment-Lease Arrangements. Have extra cash to get out of your practice? Equipment-lease arrangements are a good way to do this. These arrangements involve a physician practice purchasing equipment and leasing it to a hospital or other facility. These facilities are able to get state- of- the- art equipment that otherwise might not be in the budget, while the physician practice recognizes an income stream through rental fees.
- Management Services Organization (MSO). Physician-owned MSOs allow entrepreneurial physicians the opportunity to invest in an organization and receive passive income. Physician practices can take advantage of MSO services such as billing, collections, coding, charge entry and other services. Physician owners of the MSO can recapture money they often lose in paying outside vendors to perform these services. Successful MSOs increase efficiencies, lower costs and provide services to other practices and third parties.
- Independent Physician Associations (IPA). An IPA is an association of independent medical practices that come together to achieve the scale and volume necessary to leverage purchasing and negotiating power with vendors and payors. From loose integration to becoming an integrated multi-specialty practice, IPAs serve as a vehicle to lower overhead costs and achieve higher reimbursement.
In light of what seem like a heavy burden of regulations, entrepreneurial physicians still have several opportunities available to allow them to have thriving medical practices without increasing their patient workload. By having additional revenue streams in the practice, physicians can free up more time to do what they want to do versus what they feel they have to do.
These options should be discussed with experienced healthcare legal counsel before implementation to ensure compliance. This article is for informational purposes only and does not constitute legal advice.