We recently were asked to help a Podiatrist who ran his own practice to develop a business strategy to survive in our new healthcare world. This Podiatrist loves what he does for a living and enjoys spending time with his patients. He was very surprised to discover the new financial realities of practicing medicine and running a practice to generate enough income to pay himself, his staff, malpractice insurance, and other basic office expenses. Below are 4 learnings that helped to transform the practice to be financially sound as well as continue to practice medicine with a focus on the patient.
Seeing the Right number of patients:
The Podiatrist, who enjoyed the personal contact he has with his patients, was seeing about 15 patients a day. He was surprised to learn that some of his competitors were seeing 50-60 patients per day in order to pay their bills. He agreed that he will need to see 25 patients each day in order to achieve his financial goals.
Understanding the CPT billing codes and reimbursement rules:
The Podiatrist was very unhappy to find out that his average collected fee per procedure was only $37 (after large contracted discounts with insurance companies and Medicare). A large volume of his visits was toe nail trimmings for a diabetic population that only netted him $24 per visit. On the higher end of his fee schedule, the amputation of a toe netted him $248. He looked at the report and had a brief (and a little remorseful) reflection on the years he spent in medical school to be earning these low fees per procedure. He realized that he needed to pay more attention to how much he was spending on each procedure and the mix of CPT coded procedures he was providing (while not amputating every toe he trimmed a nail on).
Selecting a good billing company:
The billing company that the Doctor used was not meeting the needs of his practice Sending over a chargeable procedure / visit was like shooting something into a black hole and hoping a few dollars comes out the other end. There was little transparency on what charges were made for the week/month, which ones were actually paid, and what the balances were. While the Podiatrist needed a Partner in a billing company who would coach him on the latest reimbursement policies and be an advocate for collections, he was instead being provided with sloppy service with very little transparency. He needed to make a change.
Organizing the staff to serve a higher volume of patient visits:
The Podiatrist realized that in order to go from seeing 15 patients per day to seeing 25, he needed to get his two assistants on board with his Plan. They needed to adjust the scheduling of patient visits, carefully mange the patient flow through the 3 exam rooms, and maximize the effectiveness of the Doctor by doing anything that they can do so the Doctor didn’t have to. His time was at a premium and needed to be managed accordingly.
The result was that this 1-physician practice is now on a path to grow by more than 80% and allow the physician to earn a higher salary. The practice has an emerging air of efficiency while still practicing sound medicine in a caring environment.
A large healthcare education provider was seeking to expand its product line so as to boost its sagging revenues. They approached Relevante to develop a comprehensive business case to identify the best possible products as well as the markets so as to achieve their goals.
Professionals at Relevante studied their current product mix as well as their current markets and suggested a related product in two new geographical locations other than the United States. Also, the financial implications, the competitive landscape, manpower requirements and the infrastructure requirements for the new product were chalked out in the comprehensive business case.
The product was a run away success due to the lower cost alternatives suggested by Relevante and has subsequently increased top line as well as bottom line of the client.
A leading pharmaceutical company and a cancer awareness organization wanted to collaborate in responding to the growing need of women to receive health information from trusted voices. The pharmaceutical company contributed significant web based intellectual property, market research and start-up funding to the new venture. The cancer awareness organization contributed a built-out cancer awareness web portal with a large and loyal community, a network of cancer prevention and care thought leaders and a team of professionals capable of managing medical information web sites. The new entity needed help in developing their business model, service offerings, a viable financial model to secure funding and operating and marketing plans to successfully launch the company.
Relevante worked with the client to develop a business plan and successfully launch the company. We assisted the client in identifying and contracting the services of some of the best-known physicians in the country to develop and provide media products under a single brand. We facilitated the design and launch of a new web site that delivered women’s health information in the areas of expertise of the physicians under contract. We led the fundraising process to secure funding needed to grow the company. The client was able to successfully secure a prominent name in the health world, received national media coverage, secured several large revenue generating contracts and achieve profitability by its second year of operations.
A leading pharmaceutical marketing company was challenged with organizing an effective E-promotion program. They needed help with segmenting the responses to E-promotions to gather consumer intelligence on various marketing approaches. They were also desirous of organizing the responses to facilitate an easy CRM interface for follow-up. They needed help with developing and implementing these solutions in a short period of time. Simultaneous with this need, the company was experiencing data management problems resulting from multiple databases needing to feed information into a user friendly consolidated reporting infrastructure for various constituents to access on an as needed basis.
Relevante personnel collaborated with the client’s internal project management and technical staff to document and implement the operating process and technical architecture for the client’s E-promotion programs. The solution consisted of sending e-mails to potential customers and segmenting the responses in various categories based on pre-established algorithms. This automatic categorization facilitated easy follow-up communications to those potential customers. To address the multiple database data management challenge, our consultants led the database consolidation effort by working with internal project management and development personnel to design a database to support the multiple external database feeds and the processes for applying updates to the database. They also developed a web reporting interface.
A large healthcare provider implemented a new billing system and needed assistance with auditing the technical charges for lost revenues, mapping out a billing flow process and developing a procedure for training purposes for the ancillary areas. The assignment required a Relevante professional to audit and reconcile the system integration and quality assurance.
A Relevante professional reviewed several days’ technical charges of the company to find numerous errors and discrepancies between the ancillary areas and the billing system. This indicated revenue loss, lack of internal controls and needed training within the organization which were brought to management’s attention.
This professional reconciled all ancillary areas in question, identified lost revenue, created flow charts for each area and a flow chart for the billing cycle including related ancillary interfaces and a procedure document to be used for training purposes. Additionally, a list of recommendations were offered to management.
Due to a staffing change in the Payroll Department of a leading medical device company, the Relevante Consultant was called in as an interim Payroll Analyst. The scope of work included processing payrolls for over 1,200 employees with different pay frequencies, in eight different subsidiary companies, working in all 50 States within the US and Puerto-Rico. The Relevante consultant set up payroll files for employees of a newly acquired subsidiary; updated 401k and GTL accounts, and handled tax issues relating to all 5O States.
The Relevante consultant assisted the client with organizing the department, providing some structure for work flow, documenting procedures, and improving existing internal controls. Assistance was also provided in training the Payroll personnel and helping to improve the Payroll processing system by working with the client’s Finance and Human Resources departments to validate inaccuracies and make the necessary corrections; outstanding tax accounts were brought up to date. Due to more staff changes during the two weeks after the original assignment ended, the Client requested a Relevante consultant for help in the training of the new staff. The changes implemented by the Relevante consultant in the original assignment helped the client to cut their payroll processing time by 50%. The changes have also improved the efficiency and internal controls within the Payroll Department and were instrumental in the hiring of a new Payroll Manager, who is pleased with the changes made.
Based on the work done in the Payroll department, the client is considering having Relevante consultants work in their Finance department, which is currently going through staff changes.
A large, membership driven, Not-For-Profit Association requested a Relevante professional to review the 2004 cash distributions of its European operations located in Switzerland. Our performances soon lead to an extensive operational and internal control review of the overall European operations – through this professional. The Relevante professional traveled to the Swiss branch, which resulted in a comprehensive report for the Association’s Executive Director, identifying operational and internal control weaknesses, along with recommended remedial actions for the European operations.
Aligned enterprise risk management documentation and testing processes for the company’s information technology internal controls.
A large pharmaceutical company established an initiative to fully comply with Sarbanes-Oxley (SOX) regulations for year ending 2004. The company completed this initiative within the desired timeframe. However, during subsequent years, they needed to align their enterprise risk management plan for their internal compliance function that served multiple regulatory authorities. This enterprise risk management initiative considered leveraging the overlapping regulatory compliance efforts and needed to remain flexible to focus the annual audit plan on the control areas of high risk.
Relevante assisted with revising the enterprise risks plan for compliance with SOX and the FDA. We interviewed process owners, revised documented processes, identified and aligned key controls from multiple regulatory authorities, and reported to management on our findings. Our CobiT-based control evaluation approach provided management with a scorecard by control area of their risk universe, critical areas, and control points as well as a risk mitigation summary, gap listing, and remediation plan. We also helped inform personnel of the important aspects of complying with regulatory authorities.
We revised the enterprise risk management plan, related work papers, and we have been asked to continue to work closely with the internal and external auditors on evolving compliance issues, new process documentation, and testing results.
The Pharmaceutical major, with Relevante’s assistance, aligned their enterprise risk management with best practices with respect to SOX and FDA compliance. The company’s internal controls were compliant and streamlined for year ending 2006.
Our phased approach to compliance ensured participation from the company’s management and coordination with external auditors during each step so that deliverables were on time and on target, and costs were minimized. By educating the process owners about regulatory compliance and internal controls, we were able to ensure complete cooperation and a smooth and successful compliance project. The company was extremely satisfied with the value we added during this engagement, that we are now working with them on a number of other compliance related projects, including ongoing testing of internal controls.