Physicians Practice - October 2008 - (Page 65)

THE GREAT PRACTICE MAKEOVER EMR — HELP OR HINDRANCE? SHOULD A PEDIATRIC GROUP PRACTICE WITH CASH FLOW PROBLEMS MAKE THE DIGITAL LEAP? BY L AURIE HYL AND ROBERTSON Brian Dionne’s* overhead is threatening to eat him alive. OK, not really. But at an excruciating 86 percent — compared with a 63 percent average — that’s how it feels to this earnest, energetic pediatric practice administrator. As in plenty of other primary-care oriented practices, Dionne nervously watches the prices of supplies and services creep up while reimbursements stagnate or even sink. Meanwhile, payments that do come into the practice require an ever-increasing level of effort to process. But that’s not all. This practice is also dealing with a new physicianowner transitioning in. And the pricey ofﬁce space is situated in a sleek facility that also houses a variety of sports and ﬁtness amenities. In his geographic area, says the administrator, “Other practices pay $15 a square foot; we’re at around $30 a square IN SUMMARY We’re all for reaping the many beneﬁts technology has to offer, but the timing of an outlay like that for a full-blown EMR must be carefully considered. Cash-strapped practices such as the pediatric group proﬁled here may need to shore up operations before making the leap. foot.” And that ﬁgure doesn’t include taxes, or maintenance and cleaning. And if that weren’t enough, here’s one more ﬁnancial drain: all the paper, and consequent time-consuming cross-checks — required to maintain a smoothly functioning practice. Years ago, “When [the practice] was started, everything had a purpose; it was very well organized,” says Dionne. “Everything is double-checked — by color, number, letter code — so misplacing a chart is very hard.” Given mounting stafﬁng and supply costs, however, such protocols — quite advanced in the not-so-distant past — are becoming more and more difﬁcult and expensive to maintain. Naturally, Dionne hopes to minimize that outlay while maintaining the failsafes. But how? Dionne’s opinion is that much will be solved by implementing an EMR system as soon as possible, preferably within the next few months: “If we just eliminated the transcription and the physical charts and copying and faxing, that alone would pay for an EMR.” STEP BACK • Make sure you can afford to go digital. • To ensure future viability, focus all available resources on increasing income. from every expenditure. • Reap the greatest possible beneﬁt • Ask your accountant about tax planning and other strategies to ease cash ﬂow. But hang on: The equally important ﬂip-side of this overhead coin is the revenue coming in. It’s too low, in fact, and that’s skewing the overhead percentage even higher. “Our patient load is going down a little bit,” Dionne admits. This has rippling repercussions: According to his accountant, prices on essentials such as vaccines have tripled over the past year, so patient volume declines are “hurting the practice more, and it’s harder to make ends meet.” It won’t be long, Dionne fears, before the practice is no longer viable at all. An EMR ain’t gonna ﬁx that — at least not in the short-term. Before incurring such a major expense, the practice needs to ﬁgure out why patient visits are down. For starters, this practice has been around long enough to have year-over-year numbers on which to accurately base trending. Because of monthly variations, which can be dramatic in peds, it’s tough to get a valid comparison if you’re looking only at this past April compared to this past March. Is the practice experiencing a natural seasonal slowdown or the effects of provider transition (the practice’s original owner stopped practicing a couple of years ago), or does the problem run deeper? Fact is, most practices lose money on an EMR implementation — often quite a bit — for the ﬁrst year or so after going live. Some actually add staff and increase ofﬁce hours initially just to accommodate the learning curve and account for conversion issues such as misplaced charts and scanning of old ﬁles. Plus, many of the savings Dionne has so carefully totted up won’t be realized instantaneously. For instance, it’s going to take time for decreased spending on paper folders, stickers, and specialized forms to make a signiﬁcant difference in the practice’s bottom line. Basically, it costs money to switch from paper to EMR, so make sure your practice can afford to kick itself off the EMR cliff. I’d recommend that Dionne make the EMR transition a long-term goal, and instead immediately focus every OCTOBER 2008 | PHYSICIANS PRACTICE | WWW.PHYSICIANSPRACTICE.COM 65 http://WWW.PHYSICIANSPRACTICE.COM

Table of Contents Feed for the Digital Edition of Physicians Practice - October 2008

Physicians Practice - October 2008 Contents Another Reason to Go Cash-Only? Letters How ’Bout Them Gas Prices? Second Opinion: Oh, Canada! Noteworthy Cover Story: Fixing the Leaks: How to Tighten Your Money Spigot Navigating a Lawsuit Ask the Experts The Administrators Desk: What’s Your Mission? EMR: Help or Hindrance? Dealing with Dr. Dangerous E-Mail Abuse Primer The Road to EMR Interoperability Don’t Let Staff Costs Stifle Profits Coding Classifieds Advertiser Index

Physicians Practice - October 2008

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