Financial Reporting for the Medical Practice

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Financial Reporting for the Medical Practice

  1. 1. Financial Reporting for the Medical Practice Medical Group Management Association Healthcare Financial Managers’ Association
  2. 2. Your Presenters <ul><li>Chris Keefe </li></ul><ul><li>CFO </li></ul><ul><li>Metro Imaging </li></ul><ul><li>Sharon Sagarra </li></ul><ul><li>Controller </li></ul><ul><li>Radiologic Imaging Consultants </li></ul>
  3. 3. Preview <ul><li>Volume </li></ul><ul><li>Collection/reimbursement </li></ul><ul><li>A/R </li></ul><ul><li>Productivity </li></ul><ul><li>Financial statements </li></ul>
  4. 4. Who is your audience? <ul><li>Doctor/CEO </li></ul><ul><li>Doctors/owners </li></ul><ul><li>Doctors/non-owners </li></ul><ul><li>Management </li></ul><ul><li>Staff </li></ul><ul><li>Bank </li></ul><ul><li>Outside accountant </li></ul>
  5. 5. What are the Hot Buttons? <ul><li>Volume </li></ul><ul><li>Collection % </li></ul><ul><li>Physician productivity </li></ul><ul><li>Billing expense </li></ul><ul><li>Staffing expense </li></ul><ul><li>Others? </li></ul>
  6. 6. Volume Reporting
  7. 7. Volume by Type of Service
  8. 8. Exam Comparison
  9. 13. Monitoring Collections, Reimbursement, Billing Performance
  10. 14. Receipts by DOS
  11. 15. GHP Collections by Site
  12. 16. Reimbursement/Collection/Mix
  13. 17. Collection Rates
  14. 18. Writeoffs
  15. 19. A/R Trends
  16. 20. Accounts Receivable Reconciliation
  17. 23. Productivity Monitoring-Physicians
  18. 24. CPT by Physician
  19. 25. Volumes for Key Indicators
  20. 26. # Exams Read per FTE
  21. 27. Work RVUs per FTE Radiologist by Site
  22. 28. Productivity Monitoring-Staff
  23. 29. Staff Productivity
  24. 30. Overtime Monitoring
  25. 31. Tardy Monitoring
  26. 32. Biller Productivity
  27. 33. Financial Statements
  28. 34. Chart of Accounts <ul><li>MGMA Chart of Accounts </li></ul><ul><li>MGMA Cost Survey </li></ul><ul><li>Outside Accountant’s Chart of Accounts </li></ul>
  29. 35. Cash vs Accrual <ul><li>Cash is easy </li></ul><ul><li>Tax basis </li></ul><ul><li>Docs understand it </li></ul><ul><li>Expenses fluctuate </li></ul><ul><li>Impact of doc’s vacation </li></ul><ul><li>Accrual is more work </li></ul><ul><li>Must estimate net revenue </li></ul><ul><li>Rev & Expenses matched to proper period </li></ul><ul><li>Malpractice spread out </li></ul>
  30. 36. Modified Cash <ul><li>Best of both worlds </li></ul><ul><li>Spread large expenses </li></ul><ul><li>Book depreciation </li></ul><ul><li>Flexible </li></ul><ul><li>Easy </li></ul>
  31. 37. Contractual Allowance <ul><li>Can be difficult to estimate </li></ul><ul><li>How do you know when it is right? </li></ul><ul><li>How long does it take to collect every penny? </li></ul><ul><li>Changes every year </li></ul>
  32. 38. Timing of Financial Statements <ul><li>When should your F/S be ready? </li></ul><ul><ul><li>On the first? </li></ul></ul><ul><ul><li>10 days after month-end </li></ul></ul><ul><ul><li>15 days after month-end </li></ul></ul><ul><ul><li>25 days after month-end </li></ul></ul>
  33. 39. Impact of Physician Comp <ul><li>Your physician compensation formula can drive your F/S format </li></ul><ul><li>Expenses by doctor: </li></ul><ul><ul><li>Car, CME, travel, Dues, Licenses </li></ul></ul><ul><ul><li>Their nurse, their staff, their space….. </li></ul></ul><ul><li>Separate cost centers for each doctor? </li></ul><ul><li>How far do you go? </li></ul>
  34. 40. Financial Statements Samples
  35. 41. Basic Income Statement
  36. 42. Income Statement to Budget
  37. 43. Trend Report – 12 rolling months
  38. 44. Trend Report – Income Stmt
  39. 45. Net Profit per FTE
  40. 46. Balance Sheet <ul><li>How do you use it? </li></ul><ul><li>Balance sheet ratios: </li></ul><ul><ul><li>Debt to equity=Total debt/equity </li></ul></ul><ul><ul><ul><li>What equity????? </li></ul></ul></ul><ul><ul><li>Current ratio=Current assets/current liab </li></ul></ul>
  41. 47. 12 Month Trend Report – Balance Sheet
  42. 48. General Ledger Analysis
  43. 49. RVU Report
  44. 50. Cash Flow
  45. 51. Sample Reporting for Physician Compensation
  46. 52. Direct expenses <ul><li>Phys comp & benefit </li></ul><ul><li>Prof liab ins </li></ul><ul><li>Employee salaries </li></ul><ul><li>Dues, memberships </li></ul><ul><li>CME, travel </li></ul><ul><li>Meals, entertainment </li></ul><ul><li>Rent </li></ul><ul><li>Marketing </li></ul><ul><li>Retirement plan </li></ul><ul><li>Health insurance </li></ul><ul><li>Auto </li></ul>
  47. 53. Variable expenses <ul><li>Employee salaries </li></ul><ul><li>Employee benefits </li></ul><ul><li>Medical supplies </li></ul><ul><li>Drugs </li></ul><ul><li>Physician services </li></ul><ul><li>Transcription </li></ul><ul><li>Data processing </li></ul><ul><li>Billing/collection </li></ul><ul><li>Telephone </li></ul><ul><li>Postage </li></ul>
  48. 54. Fixed expenses <ul><li>Employee salaries </li></ul><ul><li>Employee benefits </li></ul><ul><li>Rent </li></ul><ul><li>Equipment leases </li></ul><ul><li>Building maint </li></ul><ul><li>Property taxes </li></ul><ul><li>Interest </li></ul><ul><li>Equipment maint </li></ul><ul><li>Legal and acctg </li></ul><ul><li>Utilities </li></ul><ul><li>Telephone </li></ul><ul><li>Depreciation </li></ul>
  49. 55. In conclusion <ul><li>They are your reports – they should help you do your job </li></ul><ul><li>For doctors – no errors allowed </li></ul><ul><li>Use graphs – you can skew them anyway you want </li></ul>

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