Lead, Follow, or Turn Out the Lights
By: Dave Jakielo, CHBME I was rereading the booklet written in 1988 by Pritchett and Pound titled Business as Unusual. Its premise is how to survive in an ever-changing environment similar to our current medical billing marketplace. It is hard to believe that it was published over a quarter century ago but it couldn't be more relevant based on what we are facing today. Let's take a look at the past, present, and future of our industry. In the PAST, billing companies enjoyed a high profit margin even if they weren't very efficient. Some of the characteristics of a typical company of days gone by were: PRESENTLY, billing companies are noticing that profits may be shrinking and margins are being squeezed due to lower reimbursements and higher operating costs. One example is when Pritchett and Pound published their booklet, first class postage was 25 cents and today it's 46 cents. Other issues facing us today are: So what lies ahead in the FUTURE: the billing industry won't go away; there will always be a need for our services but it will change as we know it today. Companies will be larger and there will be fewer of them. Conservatively speaking, I predict that about 30 percent of the companies in business today will disappear. And your company may be one of the fatalities unless you are always on the path of continuous improvement. This isn't a prediction, rather it's a calculated guesstimate based on what is going on around us. The key is to constantly examine each and every process in your firm and ask yourself the questions: In summary, we need to LEAD, meaning continually growing your business' revenue 10 to 15 percent per year. Or FOLLOW, meaning merging with a company who has similar goals, objectives, and values, and becoming an employee. However, if you don't do one or the other of the above, then you'll need to turn out the lights when your last client leaves. Dave Jakielo, CHBME, is an International Speaker, Consultant, Executive Coach, and Author, and is President of Seminars & Consulting. Dave has been helping Companies grow and improve their profitability for over 4 Decades. Sign up for his FREE weekly Success Tips at www.Davespeaks.com. Dave can be reached via email Dave@Davespeaks.com; phone 412-921-0976.
" A stable long-term client base.
" Not much pressure to reduce management fees.
" Low employee turnover (and some folks we employed could be slackers).
" You sent out a bill or insurance claim form and someone paid it the first time.
" Paper, paper, and more paper passing from workstation to workstation-we would date stamp it, alphabetize it, file it, and store it forever.
Companies made money because there was so much fat in the system that even poorly run companies could turn a profit.
" An ever-changing client base as acquisitions and mergers are prevalent in many medical practices.
" Management fee pressures prevail as rates are dropping due to some companies becoming more efficient.
" Moderate to high employee turnover depending on the economy in the area your company is located (and we still put up with people who don't give 100 percent).
" A substantial increase in third party rejections, denials, and patient deductibles.
" Still too much paper handling which increases costs and hinders productivity.
Companies are finding it more challenging to maintain the margins and profits they enjoyed only a decade ago. Because of the ever-changing rules and regulations, we are also learning that there isn't anything as an "Experienced Biller."
" You'll need to be prepared to work with larger and larger clients.
" Pressure to reduce fees is here to stay and we will always need to find ways to do more with less.
" Your employees will expect job diversity. People won't want to do the same function for 40 hours a week. Plus everyone will need to be highly productive.
" The following will need to become second nature in your company: 270-271, 276-277, and patient portals. If you don't know what I'm referring to just do a Google search.
" You'll need to adopt a totally paperless environment. Deal with only with the exceptions and allow technology to handle the bulk of the work.
" How can I eliminate this function, policy, or procedure?
" How can I improve on this function? Do it faster and cheaper.
" What other revenue-generating services should I be offering to my clients?