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Financial Management

Resources to improve your bottom line and help you manage a financially sound practice.
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The climate of shrinking reimbursements, increasing costs and an aging population is placing more demand on ophthalmologists and staff members to develop sound financial management practices.

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Related Article: It’s Worth It: Simple Steps Any Practice Can Use to Create an Effective Budget [Author: Andrew Maller, MBA — Consultant, BSM Consulting]

Ophthalmic Practice Financial Policy

A successful financial policy clearly communicates procedures and responsibilities, provides a verifiable source of data, and automates the internal workflow to the fullest potential in order to increase cash flow and minimize loss. The key to this process is flexibility, as the medical world changes, the practice responds and changes and moves forward. Continue reading, Ophthalmic Practice Financial Policy.


Understanding Financial Statements

The Basics

This series of financial articles are designed to introduce young ophthalmologists to the basics of the financial statements commonly prepared in connection with the operation of ophthalmology practices.

Understanding Financial Statements for the Ophthalmologist:


Cash Accounting Versus Accrual Accounting

Financial statements are normally prepared in accordance with what are called generally accepted accounting principles. Although, this term sounds a bit fuzzy, it actually has a very specific meaning: It requires the use of the accrual method of accounting. Under the accrual method, revenue is considered earned and is recognized in statements for the period when the revenue transaction occurred, regardless of when the related cash is collected. So, for example, under the accrual method, a practice’s earnings are posted at the time services are provided. Similarly, expenses are incurred at the moment the liability is incurred, regardless of payment terms. For example, on any given day, a practice’s expenses include the hourly wages earned by staff members that day, even though the payroll funds may be paid out only twice a month, which might be a week or more away. Continue reading, Understanding Financial Statements.


Billing

Alert: Academy and ASCRS Share CMS Guidance to Clarify Medicare Billing for Femtosecond Laser Use

On Nov. 16, 2012, The Centers for Medicare and Medicaid Services released guidance [PDF 252K] to clarify when beneficiaries can be billed for non-Medicare-covered services using the femtosecond laser to insert a premium refractive intraocular lens, after cataract surgery.

CMS indicates that it is possible to bill beneficiaries for use of the femtosecond laser for services such as imaging when a premium refractive IOL is implanted, but not when a conventional IOL is used. The agency specifically does not permit billing for the use of femtosecond laser technology in conjunction with Medicare-covered steps of the cataract surgery, such as the phaco incision, capsulotomy and lens fragmentation. CMS is providing the clarification in response to a press release issued by an ophthalmology practice that describes use of bladeless, computer-controlled laser surgery for cataract removal. CMS believes the release may imply a different Medicare policy regarding non-covered services that may be charged to the beneficiary if the cataract surgery is performed by such means.

  •  Joint guidelines for billing Medicare beneficiaries when using the femtosecond laser. These guidelines were developed by the American Academy of Ophthalmology and the American Society of Cataract and Refractive Surgery. For more information, contact: Catherine G. Cohen, American Academy of Ophthalmology vice president of governmental affairs, at cgcohen@aaodc.org or 202.737.6662; or Nancey McCann, American Society of Cataract and Refractive Surgery director of government relations, at nmccann@ascrs.org or 703.591.2220.

Managing Your Practice’s Billing Operation

In assessing the performance of their ophthalmic billing and collections process, the administrator should not only pay particular attention to the core functions of the billing and collection process but also examine certain “ancillary” components that are not typically included in a billing conversation. These ancillary components must function accurately and completely to achieve an efficient and effective billing process.

The business process components include:


  • Insurance credentialing
  • Patient registration/demographics
  • Appointment scheduling
  • Insurance verification/preauthorization
  • Appointment reminder
  • Patient arrival
  • Clinical service
  • Charge-capture
  • Coding
  • Fees
  • Charge-entry
  • Claims submission
  • Receivables management
  • Management reporting

Continue reading, Managing Your Practice's Billing Operation.


Getting the Last 10 Percent: Moving Billing and Collection Performance from Mediocre to Outstanding

The billing and collection process closely resembles the clinical processes used to evaluate and manage a patient’s medical eye problems. During a medical examination, all components of the history and/or exam must be completed. If even one is omitted, an incorrect diagnosis could be made and improper treatment could be initiated, usually with suboptimal results. As an administrator or a practice owner, it is your responsibility to ensure that each step of the business process is carried out correctly and completely, to markedly increase practice revenue. Continue reading, Getting the Last 10 Percent: Moving Billing and Collection Performance from Mediocre to Outstanding.



Collect Every Last Dollar - Improve Your Billing and Collections Performance

Free Webcast - AAOE Member Benefit

In an era of declining reimbursements, practices cannot afford to let revenue fall through the cracks. Ensure that you are appropriately paid for the services you provide by improving your billing and collections processes and learning the best practices for achieving optimal financial resultsView Collect Every Last Dollar - Improve Your Billing and Collections Performance webcast.


Top 10 Ways to Improve Medical Collections

While patients expect prompt and professional service from their doctors, they don’t always meet the same standard when it comes to paying their bills. Accounts not paid within specified terms can severely impact the overall cash flow of a practice. A clearly defined, carefully communicated, yet diplomatic payment policy may help avoid difficult collection situations. These 10 simple steps can dramatically improve collection results. Continue reading, Top 10 Ways to Improve Medical Collections.


Just What the Biller Ordered Archive

Browse archive of monthly columns on billing tips by guest columnist, Nancy LaVergne, CPC, OCS — Jackson Eye Associates, PLLC

To Incentivize or Not to Incentivize, That Is the Question [Author: Sue Loen, OCS] — April 2013

New for 2013: 20 Percent Reduction of Technical Component of Second and Subsequent TestsMarch 2013

Collections, Payment Plans and Financing OptionsJanuary 2013

Outsmarting Office Thieves — November 2012

Incidences of Theft — September 2012

Insurance A/R — August 2012

Patient A/R — July 2012

The Encounter Form — June 2012

Medical Claim or Vision Claim — May 2012 [Premier Issue]


The Profitable Practice Collection

Developed by AAOE, The Profitable Practice Collection makes mastering key financial management concepts easier. With this seven-module collection, you will learn how to boost your bottom line; convert clinical services to practice income and use data to drive results.  

Profitable Practice KitTitles in the series: