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Physician Groups, Clinics Will Continue To Battle Administrative & Financial Burdens in 2019

April 1, 2021
April 1, 2021

An unsettled healthcare landscape continues to pose administrative challenges for independent physican groups and clinics. Two issues in particular, administrative burdens and revenue collection, are likely to present problems well into 2019 and beyond.

Each is problematic because of staff and physician time taken away from actual patient care, which in turn reduces billable hours, which affects overall revenue and practice or clinic health. Payer interaction  in particular is an ongoing nightmare for practices, which were spending $82,975 per year on this task according to a 2011 study published in Health Affairs—a figure that has continued to rise. The same report said that American physicians are spending an average of 8.7 hours a week, more than a full workday, on administrative chores. In addition to fewer patients, such labor affects job satisfaction and can spur turnover. From a different angle, that’s 20 percent of the workday spent on prior authorizations, EHR data entry and non-clinical paperwork, totaling at least $50,000 in lost revenue per year, according to the Physicians Foundation.

The Toll of Uncompensated Tasks

Uncompensated tasks are a fact of life in any business, and physicians know that. Still, as much as doctors don’t like administrative work, they really don’t like bill collecting, which means that task falls to others in the practice—often requiring a dedicated staff member if past-due accounts climb—and added staff equals more payroll. This is happening more as higher patient co-pays and deductibles are part of the post-Affordable Care Act landscape, thanks to Bronze, or lowest-premium plans, that can be purchased on the exchanges or are provided by employers, that offer comprehensive care but come with individual deductibles that can top $6,000 per year alongside family plans that can top out at more than $13,000 per year. According to a National Public Radio report in 2014, higher-deductible plans played a role in a 14 percent rise in bad debt between 2008 and 2014 for multispecialty groups. Hospitals aren’t immune either; a J.P. Morgan report from that same time period said that bad debt from insured patients was growing 30 percent annually for some providers.

Many healthcare analysts will argue that the overall savings afforded by deductible-free preventative care and wellness visits, such as immunizations and annual physicals, offset those up-front costs because patients are seeing their doctors more frequently and thus are taking better care of themselves. That may be true, and could even be helping overall practice or clinic revenue, but those entities are still left with more outstanding accounts than they may have seen when more insurance plans were built around flat copays and lower deductibles alongside preexisting condition and other exclusions.

Can Tech Help Ease the Back-Office Burden?

Bad debt and paperwork aren’t going to go away, so it falls to self-run physician groups and clinics to find their own solutions. Many are doing just that by exploring what the latest technology has to offer, especially around streamlining administrative processes. For example, software packages for more thorough physician credentialing are helping cut down on denials and slow-pay issues from insurers. Practices and groups also are paying more attention to compliance and making sure that they are following the latest rules, directives, and regulations, whether from the Centers for Medicare & Medicaid Services or a commercial payer.

On the financial front, enhanced automated systems for payments can quickly verity insurance eligibility as well as confirm care authorizations and inform the practice of co-pay and deductible levels so the patient can sign off on those, and provide at least some up-front payment, before the care process begins.

That insistence on up-front payment can be softened by more patient-friendly billing statements as well as continual communication with patients by way of education and counseling around the cost associated with healthcare. Many practices and clinics have also added a pharmaceutical component to this challenge, helping patients with financial burdens to access necessary medications. Such efforts can result in a far more relaxed interaction between patients and care providers, something that will be important as HCAHPS assessments and scoring continue to move out of the hospital setting and into freestanding ERs, clinics and practices. As with hospitals, those scores will dramatically affect CMS reimbursement, and thus the practice or clinic bottom line.