Dr. Steven Odzer: The Main Financial Performance Indicators in the Pediatrics World
Friday, December 13, 2019, 6:00 AM | Leave Comment
Every industry depends on finances. The pediatrics world is no different and all practitioners who run businesses in this industry need to be well-informed about the market.
In the modern era, the increased penetration of technology has ensured that every aspect of the business is done digitally.
Programs like Excel spreadsheets and other accounting software have become necessary for performance-monitoring in the pediatrics world.
What do pediatricians need to keep track of their financial performance? Dr. Steven Odzer, a well-known pediatrician who has succeeded in the business realm has identified the following performance indicators in the pediatrics world.
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Cost for each encounter
It is important to keep track of the cost per encounter with a patient. In every business, the knowledge of the basic cost per service is crucial. Pediatricians specifically need this information as it guides during negotiations with managed services providers.
The cost per encounter should thus be the basic performance indicator that every pediatrician should keep track of at all times. To get this cost, you need to measure the overall operating expenses against the number of office encounters.
Monthly turnover is also an important indicator that every practitioner should prioritize. In order to get a meaningful figure though, you will need to specifically compute the receivable turnover. This is calculated by taking the accounts receivable sum and plotting it against the average monthly collections. A positive graph would indicate that the practice is going on well. A key thing to note about this turnover is that it will change depending on the season.
According to 7sensescbd.com, pediatric trends tend to change with the season. The cold season for instance often comes with flu and other kinds of infections. This will thus reflect on the turnover for these months.
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The net collection rate
Another crucial performance indicator that all practitioners should prioritize is the net collection rate. This is computed by taking the total payments and plotting the number against the total charges less contractual adjustments. The ratio that results is crucial for showing you how much the business has earned.
Dr. Steven Odzer claims that depending on the contracts that you have signed, the ratio might be bigger or smaller. Normally, practitioners who have signed up for multiple managed care services will see a bigger sum of their income going towards payments to these companies. The net collection ratio might thus be affected by such payments.
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Total successful claims
Finally, it is important to calculate the ratio of all the successful claims that have been made. For most practitioners who work with managed care service providers, cases of unsuccessful claims are common. These claims are those that could delay beyond the expected period. Such claims should not be computed before they are finalized. In order to get the rate of the total successful claims, you need to take the number of completed claims and compare with total claims submitted. The resultant ratio will tell you if your business has fared as expected in a given period.
