With today’s rapidly changing healthcare environment, physicians must spend time working on, not just in, their practices. Medical practice strategic planning can be a challenge, but analyzing the practice’s current standing and deliberately forecasting for future endeavors can be the equivalent of a hole-in-one for a medical practice.
Step 1: Evaluate the current competitive market.
- What is going on in the local healthcare market?
- Who is the practice’s competition? Do the competitors include hospital-employed physicians and ancillary service providers?
- What differentiates the practice from the competition?
Step 2: Evaluate the medical practice.
Take an in-depth look at the practice’s trends by examining the following areas:
- Financial statements. Review financial statements from the last five years. Historical financial statements will show increases and/or decreases in revenue as well as cost fluctuations, which can relate to the practice’s collections.
- Payer mix. Analyze the payer mix (i.e. the ‘mix’ of insurer types that are paying the practice) to determine who the practice’s big payers are and to ensure timely payment.
- Collection ratios. Evaluate gross and net collection ratios to determine overall reimbursements.
Step 3: Evaluate physician productivity.
Productivity reports should be compiled and maintained by the practice administrator. These reports should track the production of each provider at the practice, including physicians and mid-level practitioners. Productivity reports can be customized to track charges, collections, patient office visits, days in office, and much more.
Step 4: Identify strengths, weaknesses, opportunities, and threats.
Performing a SWOT analysis will provide a list of both positives and negatives within the practice—a list that lends itself to a roadmap for improvements. When conducting a SWOT analysis, consider opportunities or threats that will arise with the changes occurring in the current healthcare environment. Also, consider the impact of the Patient Protection and Affordable Care Act (PPACA) on the practice.
Call a Medical Practice Strategic Planning Pro
CRI’s healthcare CPAs can facilitate the strategic planning process for your practice. Just like a caddy, we can analyze the course ahead and provide the proper tools to help you improve your game.