With Covid-19 being around the world, all the major insurance companies continue to allow a charge to be raised in respect of remote consultations.
That hasn’t always been the case.
In the pre-Covid days, some insurance companies would not allow you to charge for them.
Vitality is the company that immediately springs to mind. This is not a criticism of Vitality for it is up to them what they allow a charge for or not.
But it is worth just stepping back and thinking about the demand for remote consultations.
Many consultants were previously not in favour of them anyway.
When the lockdown was introduced early in 2020, remote consultations were seen as the way to continue with a patient’s care. Very much a case of needs must!
What becoming disconcerting however were the number of people who claimed they were the future.
However…
It’s not the consultant who ultimately has the say on whether remote consultants are the future or not.
It is the patient’s appetite for them which dictates their future.
For the same reason as the consultant ie lockdown, patients were happy to have a remote consultation.
But what will happen when Covid-19 is finally defeated?
In my view some patients WILL be happy to continue with remote consultations. But many won’t.
There is, however, an additional factor.
As at today, most insurance companies pay the same for a remote consultation as a face-to-face consultation. That has not always been the case.
For example: BUPA paid significantly less for a remote consultation pre-Covid.
That insurance companies allow the same fee to be charged is purely a PR exercise in my view.
It would have looked terrible to reduce fees in respect of remote consultations during a pandemic.
But consider what will happen AFTER Covid-19.
I will not be at all surprised to see the fees for remote consultations reduced significantly post Covid.
Coupled with a falling demand from patients too, then remote consultations may not be so attractive to a private consultant as they are now.
pete@medicalhalthcaremanagement.co.uk
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I’m a really, really impatient person.
I like everything done yesterday.
Which is why I go incredibly slowly to start with.
When I begin to raise invoices for a consultant surgeon, for example, I’ll check I have the right provider number.
I’ll check all the online systems and EDI protocol are 100% accurate and I’ll check that the insurance company has the right BACS payment details.
I’ll check the remittance advices are going to the right place.
What I’m actually doing is reducing down to absolute zero as many reasons as I can possibly think of that will prevent the invoice being raised correctly.
Of crucial importance is making sure there are no reasons for payment to be declined.
What happens if I don’t take this approach?
Invoices come flying back. They don’t come back straight away of course.
It takes time before I’m notified there is a problem.
Then I have to work out why it went wrong, get all the details to put the error right, actually put it right and then resubmit the invoice.
Then I have to wait again for the invoice to be reprocessed.
Eventually, the invoice gets paid.
One absolutely true example. Recently MHM project managed a group of three surgeons in the Midlands.
All three were seriously considering closing the practice as they were not making any money.
They were not getting paid as they should.
The senior of the three was responsible for invoicing for all three each week.
Just under 50% of the invoices he produced came back unpaid.
The insurance companies concerned requested more details or raised query against them.
The senior consultant complained he hadn’t got enough time to keep sorting these things out.
He had to raise invoices as quickly as possible.
He tended to view any medical invoicing problem from the “quickest fix” point of view. To use his words “I only want to be a surgeon and not a whatever-you-call-it”
My kind of guy. Don’t talk about it. Get on with it. Play to your strengths.
Save that is precisely what he was not doing.
He jokingly told me his blood pressure was sky high due to the constant stream of invoice problems.
Yet it was this “quickest fix” approach that was the cause of his blood pressure.
Many times his quick fix in one area (get them on the phone or treat the patient as a self-funder for example) caused a problem in another area.
Then he had to fix that.
This was leading to a six /seven-week delay before invoices were accepted by insurance companies on top of the agreed payment terms.
It took me two months to re-map the process, test, amend it and bed it in.
In month three we started to see the results.
Invoice failure rate had dropped from roughly half to below 6%.
Cash flow had doubled.
The time with which the three consultants got paid decreased from around every 75 days to about 50.
All three consultants were happy. Imagine the surprise though when I told them that wasn’t good enough?
I thought we should see at least a 98% acceptance rate and to be paid every 30 days.
And I wanted to achieve that as of yesterday starting with raising the invoices every single day rather than weekly.
The invoice process was robust. There were very few errors. There were few reasons why we shouldn’t be paid.
All because we followed the “do it once and do it right” approach.
pete@medicalhealthcaremanagement.co.uk
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Taking ONE real-life client as an example.
Week ending Friday, July 24th: out of 15 consultations, 4 (four) came back with excess deductions £575.
So for a total of £2,500 worth of revenue from outpatient consultations £575 or 23% came back short.
Looking back to the same week in 2019, the number of excess was roughly half this.
The question as to why this is happening is not the concern.
The concern is what are you going to do about it.
If 23% continues the downside and potential loss to the consultant is significant.
There is only one real way to resolve this issue. Phone them!
Sure you can write letters and even email but nothing gets a response like a ringing telephone.
Most patients claim to be unaware of the issue but some think this is an issue between them and their insurance company.
In other words, the patient thinks they need to pay the insurance company.
They think the consultant gets paid in full by the insurance company.
There are variations on this but the crucial point for the consultant is not to establish why; its to ensure he recovers the excess efficiently.
But if telephoning the patient is the most efficient way to tackle the issue, it does not automatically follow its the easiest.
It has to be done professionally and with due diligence.
The long-suffering med-sec really won’t have the time to do this as professional and caring as she undoubtedly is.
I promise you faithfully, she won’t want to phone patients for money and will be thinking this is the least enjoyable part of her job.
There is an alternative though: do nothing.
Some patients actually will pay but this assumes they a) are aware of the excess and b) make it good straight away.
What if they don’t?
Assume it’s not £575 or 23% a week or £27.6k a year (£575 multiplied by 48 – not 52 weeks as you will have 4 weeks off a year).
Assume instead its 10% for 24 weeks (i.e. roughly half of the current numbers) and allows for some patients paying without being contacted.
The potential losses for the consultant, in this case, reduce to £13,800 per annum.
That’s a chunk of change in anybody’s book.
What’s significant is that at a number of client meetings recently I’ve asked what the client considered the biggest threat to the practice during 2020.
Most popular was a further reduction in private insurance fees.
That may indeed turn out to be a big problem.
But at this point, empirical evidence suggests its potentially leaving the back door wide open so to speak and enduring £13,800 worth of potential losses right off the bottom line.
I’d be really interested to hear from anyone who is seeing an increase in excess and their views on remedies.
pete@medicalhealthcaremanagement.co.uk
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In terms of medical billing, this perhaps is one of the statements I say to private consultant surgeons more frequently than others.
The following example illustrates that despite the rejection of the fee how the fee was established confirms there is little the consultant can do about it.
The consultant surgeon concerned had applied to be recognised by a private medical insurance.
MHM had spoken to the consultant and pointed out fees should be confirmed when recognition was being arranged.
The consultant was well qualified, had held a substantial NHS post for a number of years and his/her specialism was in high demand.
The private medical insurance company was keen to offer recognition.
Thus recognition was granted.
Yet despite the warning by MHM fees had not been checked.
MHM was subsequently asked to handle the medical billing side.
In order to do so, we need to know how much consultation fees were.
The medical professional, however, did not know what the consultation fees were.
Thus alarm bells immediately started ringing.
Consultation fees would have agreed to and would have been detailed in the pack supplied to them by the insurance company concerned as we had advised. So we called the insurance company and quoted the newly acquired provider number.
As usual, the insurance company was keen to point put the consultant had agreed to adhere to the published fees.
It is always amusing when “fair and reasonable” is quoted to me because it depends on what the consultant thinks is “fair and reasonable”.
More specifically what happens if the thinking differs between the two parties concerned. And that is precisely what happened in this example.
The insurance company deemed that £175 was a fair and reasonable fee for a consultation.
The medical professional deemed that £250 was a fair and reasonable fee.
And thus the consultant instructed MHM to charge consultation at £250.
MHM pointed out that it would indeed charge £250 as instructed.
All that would happen, however, is the insurance company would reduce the value of the invoice down to the £175 originally agreed.
And that is precisely what did happen.
Despite the medical professional objecting strongly to a consultation fee of £175 and insisting a “fair and reasonable” fee was £250, the invoices were reduced in value.
It mattered little to the insurance company that the MHM client had colleagues who were both charging and getting paid £250.
Even before I asked the question I knew this was to be true. It mattered even less to the insurance company that a second colleague was paid even more than £250.
This was so because the second colleague was in a completely different specialism!
Sadly the MHM client had based their practice business plan on a consultation fee of £250. They had done so because they had asked colleagues how much they were paid.
Then they had assumed such fees would equally apply to them.
MHM, per normal, had no issue calling the insurance company concerned and arguing the case on behalf of the medical professional.
That said it was an argument that it was never going to be won. The simple reason remained that at the point of recognition the MHM client had accepted the fees.
Sure enough, the insurance company stood firmly behind its agreement with the consultant.
ASSUMPTION LEADS TO PROBLEMS.
The moral of this sorry tale is best summed up by the above heading.
I’m not suggesting you shouldn’t challenge fees for consultations or indeed a surgical episode but don’t put yourself on the back foot by accepting fees and then challenging them afterward.
As painful as it is for the MHM client, it really is as simple as that.
Check your fees before you agree to them!
pete@medicalhealthcaremanagement.co.uk
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Never, ever base your practice business plan on there being 12 months in a year.
There aren’t!
The question should be how many WORKING months there are in the year.
It is extremely rare for any private consultant to find he or she is inundated with patients during December. There will be some. Nonetheless, there won’t be many.
Many patients have got other things on their mind during that particular time of the year.
That doesn’t mean the whole of December will be lost but around half of it will.
The same came be said of August. Patients prefer to go on holiday.
Come to think of it, many consultants like to go on holiday in August too. Just as they like to have Christmas off as well as the patients.
So if your business plan is to make say £120,000 a year (or any other target for that matter), don’t assume your monthly target should be £10,000 each month.
Instead, you should set a monthly target of £10,909 a month ie £120,000 divided by 11.
The issue gets even more complicated though for many MHM clients when study leave, NHS commitments or whatever else they get up to.
Factoring in an additional allowance for commitments unconnected to the practice or an allowance for patient preference is important.
pete@medicalhealthcaremanagement.co.uk
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For the simple reason, cash does not flow.
Cash has to be managed.
Around this time of year, I take calls from consultant surgeons who in view of their impending tax payments require an increase in cash collections.
It’s happened every year since MHM was formed. The normal instruction is to increase the cash flow. Immediately. Simple enough. I can do that.
Existing clients don’t call because invoices have already been generated for them and they’ve already been paid for their work.
Their cash has already been maximized.
The real problem faced by potential clients though was highlighted this morning when a consultant surgeon referred to needing an outstanding cash flow “purge” within his practice.
This highlights to me a more fundamental underlying issue. Let me explain.
A consultant surgeon – just the same as any business – should know how much he is invoicing both in terms of patient numbers and the value of those patients.
If he is invoicing correctly and ensuring he gets paid he can also, therefore, calculate his revenue receipts.
he wasn’t a consultant surgeon but sold another service or product, he should be able to perform the same calculation.
So he knows how much he is or should be invoicing. Providing he proactively manages his practice.
If you think about it, most consultant surgeons already know their overheads too. They know how much their room rental is. They know how much the staff cost.
And they know how much their professional indemnity costs (too much before you ask).
Of course, there are other expenses but fundamentally they already know their expenditure.
They know their total costs.
Therefore they know or should know how much they are spending too.
Enter stage left Mr. Micawber:
He knew a thing or two about how to run a private medical practice did Charles Dickens.
For one thing, he knew cash doesn’t just flow into it.
It has to be managed.
pete@medicalhealthcaremanagement.co.uk
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That’s an interesting question. Many don’t appreciate that a private medical practice can fail.
And some do.
A private medical practice can fail for the same reason that ultimately any business fails.
It runs out of cash.
Whilst obviously there may be a lack of patient numbers or lack of customers in a “normal” business, it is the financial contribution patients make that matters.
Without a paying private patient the consultant will not generate any money.
If no money is generated into a private practice it will require more money putting into it than being taken out.
And that defeats the object of opening and running a private medical practice.
It is that simple.
Which is why it is even more concerning for a consultant to see patients and NOT invoice them.
The first rule of medical billing should be to guarantee that you actually raise an invoice and that invoice is complete in all parts.
Without doing so, your practice WILL fail.
pete@medicalhealthcaremanagement.co.uk
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It is dangerous for an insured patient to assume his insurance covers everything.
Often it does not. This will impact on how much you get paid.
Private medical insurance is designed for short-term issues. For example, an injury that suddenly happens and treated/cured relatively quickly.
A broken hand can be treated quickly. A diabetic problem may not.
Consider it this way.
Private medical insurance is in place to cover elective non-urgent issues.
If the condition was known before the policy was taken out, it may not, however, be covered.
But it does NOT follow that if the injury is short-term and treatable under private medical insurance cover, all parts will be covered.
It will depend on the type of policy held.
Basically, the higher the costs of the cover, the more covered. The lower cover may set a financial limit on how much can be paid out.
They may, for example, exclude consultations.
Whilst it may impact on the consultant surgeon it will be a sad day if a consultant even stops to consider if he/ she will treat a patient based on an insurance policy. They would not remain an MHM client if they did.
But what is the impact on the consultant?
For one thing, a budget type policy could easily lead to shortfalls. It may also lead to excess. It may result in the refusal of consultation fees.
This will lead to a requirement for the consultant to have such amounts collected from the patient.
Therefore what is covered is indeed relevant to the private consultant.
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Occasionally I get asked this question and a very important question it is too.
The normal answer is to open a practice at the nearest hospital to home. After all, nobody wants to commute more than they need to.
Bu there is another critical factor in the final decision.
Three years ago, I was contacted by an orthopaedic surgeon who was seriously struggling to grow his practice. His practice had been open for just over a year.
But he was struggling to get new patients either a self funders or via an insurance company.
It didn’t take more than an hour of desk research to work out what the critical factor was.
A search of Google indicated that there were eight orthopaedic surgeons practicing at his hospital. All of them were recognised by the major insurance companies. All but one were fee assured. With the exception of three, they all offered consultations twice a week. He offered one.
In other words, patient requirements were already well covered.
It was, and still is, difficult to compete for a finite number of patients against either well established consultants.
Nonetheless, never quit or give up.
There are many different steps to take. A well drafted marketing plan supported by a formal strategic objective would be the first item on my list.
But included in that would be a reality check.
His practice is not going to grow and grow and grow.
Expectations need to be managed accordingly.
There is, however, a lesson to be learnt.
Before you decide precisely where you are going to open your practice, make sure you check how many consultants are already there.
pete@medicalhealthcaremanagement.co.uk
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Following on from this mornings post, one of my guys called me.
He was curious as to whether his targets were sufficient or not.
Yet that is not a question I can or even should be able to answer.
It is totally a matter for him to decide if the money he makes each year from his practice is enough to compensate him for the hassle and stress of running a private practice.
That is not me ducking the question. I’m not in a position to say the between £100,000 and £200,000 he makes each year is enough.
It would be for me. But I’m not him.
Conversely however, I hear statements said to some of my clients as:
“I know a consultant who only works three days a week and makes £500,000 a year”
That could well be true.
But not if you are just starting out it isn’t. And some of mine are only a year into private medicine
Think about the economics of it for a second.
Firstly, it won’t be over a year ie 12 months or £41,666 a month (£500,000 / 12 months) Unless the consultant never wants a holiday or to have Christmas off more likely it will be over 11 months.
And that makes the maths even worse.
Over 11 months the monthly billing would need to equate to: £45,400 a month.
But with the average private medical insurance company paying around £225 for an initial consultation and £175 for a follow up ie £200 per consultation, that means the consultant would have to see circa 225 patients a month. Each and every month.
However, before anybody emails me saying I’m ignoring surgery and the self funding market, may I point out even with those included the maths still don’t add up.
I’m not saying it isn’t possible to make £500,000 per year out of private medicine for it is. I have clients who ARE making those sort of amounts. But they work a darn more than 3 days a week.
The point I’m making is whilst I will ALWAYS say having a target is crucial so a practice performance can be measured, having an unrealistic target is plain silly.
You are NEVER going to reach it. Certainly not in the early years.
All you’ll end up doing is seeing how far away from it you are.
Its much better to have £100,00, reach that and they aim for £150,000. Then once you hit £150,000 aim for £200,000.
pete@medicalhealthcaremanagement.co.uk
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I find it really interesting when I ask that question of consultants considering starting a private practice.
The answer should be: make money!
Nonetheless on many occasions I hear:
the practice should be seeing 20 patients a week
or
I want to grow a successful private practice.
Both of these are fine ambitions when starting out in private practice.
Yet neither actually puts into perspective why a consultant wants to start a private practice. Considering the enormous effort required to start up, grow a private practice and keep growing it, they are dangerously insufficient.
The real aim of any consultant wishing to enter the word of private medicine should be to make money.
Otherwise why bother?
That does not imply for a split second, making money is more important than a patient’s health. I’m pleased to say I do not have one single consultant who puts money before a patients health.
But I do have a considerable number of clients who put making money very high of the list of practice aims.
And that’s how it should be.
However:
In addition, there is a better answer to the question of why start.
That answer is to make a specified amount of money. For arguments sake, lets say £100,000 in the first year.
It doesn’t really matter what the actual number is. It could be £100,000 or £200,000 or £1,000,000 for all I care.
What the number will do is allow the new consultant to establish a target to aim at. More importantly still, it will enable him or her to measure against the target.
And that is absolutely vital if you are going to run a private practice.
After all, if you’ve got nothing to aim at, how will you know if and when you’ve hit the target?
pete@medicalhealthcaremangement.co.uk
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The silly seasonJuly and August represent the silly season for me with people on holiday.
Consider, the practice secretary on leave for the last two weeks of July. Consequently, when she is back, I will invoice for the last two weeks of that month.
In other words, one clinic each week.
Yet she only sent me one clinic list for the last week in July.
In the second clinic a particular patient’s follow up appointment needs an invoice.
Standard practice in such a case is to look back at the initial consultation.
However…
The initial consultation was not invoiced for the clinic list for that day hadn’t been supplied.
And the total clinic was worth £3,450.
And this is why, not raising an invoice is 100% guaranteed to lead to non-payment.
pete@medicalhealthcaremanagement.co.uk
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Yesterday I spoke about the clarity of data. You need to be able to read it.
Consequently, I took a phone call last afternoon from an MHM client. He reminded me how I once gently pointed out texting me was not a good idea.
We laugh about it now but back in 2018 when we started working together it was painful.
For example: if there was a problem with the clinic list I’d phone him and leave a message for him to call back.
Generally speaking this lead to a text message asking what the problem was.
So I’d text back.
This lead on to a mammoth text change that could easily take an hour. An hour of interruptions and an inability to sort a single problem out because it wasn’t clear what the issue was.
Nor was it clear what the suggested solution was.
This would happen most days to our mutual annoyance.
To be honest, I could not afford to spend so much wasted time that way. And neither could the client.
So we stopped.
Now if there is a problem, I text and ask him to call. He texts back giving me a time and I call him at that time.
Consequently on a bad week we speak once. On a terrible week, we speak twice. But we seldom have those sorts of weeks anymore.
Indeed today was the first time I’ve spoken to him since early July.
And that is why it is vital to get the right data, in the right format and prevent the very opportunity for issues to arise.
pete@medicalhealthcaremanagement.co.uk
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It is amazing how many patients a certain MHM client sees each clinic.
In the “pre Covid-19 days” he saw between 12 and 15 each clinic.
Now he is seeing between 15 and 20.
Obviously there is a back log to clear but the interesting point is the numbers have not gone down.
Why?
Well, this client does absolutely nothing other than see patients.
However, that does not mean he never works ON his practice. It means he has others work ON his practice whilst he works in it. In other words, he does what he is good at: seeing patients.
He never spends time trying to organise a clinic. Nor does he get involved in the value of his invoices. Only very occasionally will he call and ask how much a procedure is worth.
Instead, he leaves all that to others.
When he set up his practice in 2017, he realised others were better at running his practice than he.
More importantly, he understood he only gets two chances to make any money in a private practice.
1: when a patient is in an outpatient clinic
2: when the patient is in theatre.
He does not spend any of his time doing anything which does not involve either of the above.
And that is probably why he has a very successful private practice.
pete@medicalhealthcaremanagement.co.uk
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It’s really strange how, in the search of efficiency, the exact opposite happens.
Take a relatively new MHM client.
He is very good at finishing a clinic and immediately sending a scan of his clinic list to MHM. He does so every time.
The problem is he takes a photograph of his clinic list, attaches it to a secure email and sends it.
Perfect.
Except I can’t read it. That’s because the quality of the picture is poor.
In days gone by, the standard joke was you couldn’t read a medical professionals handwriting. Actually this isn’t true. For instance, all MHM clients have excellent handwriting.
It’s when technology is used incorrectly in search of efficiency that the problems arise.
Consequently, I normally have to phone the client. And that equals a delay!
More importantly this leads to an unnecessary delay in payment.
There is little point in raising an invoice without all the correct data. The chances are you can’t anyway.
Above all, the data should be in a format easily read and understood.
Look at it another way:
Invoice right = get paid right.
It is better to check the quality of the format used to send your data as well as the data itself.
pete@medicalhealthcaremanagement.co.uk
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Insurance companies use medical coding to detail a medical procedure.
For example: an Orthopaedic surgeon will understand what a Multiple arthroscopic operation on the knee (including meniscectomy, chondroplasty, drilling or microfracture) is.
That is a lot to put on an invoice!
The CCSD code W8500 will identify the procedure.
Put this code on the invoice instead.
Codes can be found on the CCSD website:
The Clinical Coding and Schedule Development Group (CCSD) consists of representatives from the major healthcare insurers.
The Group’s purpose is to maintain a common standard of procedure codes.
A CCSD code is imperative IF a surgical episode is required.
The patient should quote the code to his or her insurance company when pre-authorisation is being requested.
However, be warned.
The example above of W8500 does not come with a suggested fee.
The rate for each code is up to the individual insurance company. You need to contact them to discover what fee they will pay for each.
When an invoice is sent to the insurance company, the code should appear on the invoice. It will reconcile to that expected.
If you do NOT use CCSD codes payment will be delayed if made at all!
Without a CCSD code, you will not be able to invoice electronically anyway!
pete@medicalhealthcaremanagement.co.uk
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For the simple reason, cash does not flow.
Cash has to be managed.
Around this time of year, I take calls from consultant surgeons who in view of their impending tax payments require an increase in cash collections.
It’s happened every year since MHM was formed. The normal instruction is to increase the cash flow. Immediately. Simple enough. I can do that.
Existing clients don’t call because invoices have already been generated for them and they’ve already been paid for their work.
Their cash has already been maximized.
The real problem faced by potential clients though was highlighted this morning when a consultant surgeon referred to needing an outstanding cash flow “purge” within his practice.
This highlights to me a more fundamental underlying issue. Let me explain.
A consultant surgeon – just the same as any business – should know how much he is invoicing both in terms of patient numbers and the value of those patients.
If he is invoicing correctly and ensuring he gets paid he can also, therefore, calculate his revenue receipts.
he wasn’t a consultant surgeon but sold another service or product, he should be able to perform the same calculation.
So he knows how much he is or should be invoicing. Providing he proactively manages his practice.
If you think about it, most consultant surgeons already know their overheads too. They know how much their room rental is. They know how much the staff cost.
And they know how much their professional indemnity costs (too much before you ask).
Of course, there are other expenses but fundamentally they already know their expenditure.
They know their total costs.
Therefore they know or should know how much they are spending too.
Enter stage left Mr. Micawber:
He knew a thing or two about how to run a private medical practice did Charles Dickens.
For one thing, he knew cash doesn’t just flow into it.
It has to be managed.
pete@medicalhealthcaremanagement.co.uk
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Top up (or GAP) invoices = asking the patient to agree to pay the difference between a consultant’s fee and the fee an insurance company is prepared to pay.
The discussion concerning them seems to take place more in whispers than anything else.
And sometimes they are even deemed to be almost a taboo subject because they don’t exist.
But they do.
So, and for the record:
I have no problem issuing them on behalf of my clients.
Why and when?
Consider the case of a real consultant surgeon whose patient is quite happy to pay, for example, £852 for a surgical episode.
But the patient is insured with XYZ Insurance.
XYZ will only pay a “customary and reasonable fee” of £639.
The fee was £852 but due to “market conditions” XYZ has reduced it by 25%.
Thus the consultant may now as part of his recognition protocol only charge £639.
Most consultants actually perform the same procedure throughout the month.
Empirical evidence using MHM clients confirms they all perform, in their own specialism obviously, the same code(s) on average 5 times a month.
If that code happens to be the one reduced by £213 each time, the reduction in revenue is over £1,000 each month.
In the original scenario though, the patient has chosen to see that particular consultant.
His/her decision has zero to do with fees.
That is the consultant the patient has chosen.
If the patient is advised the fee for their procedure is £852 but their insurance company will only pay £639 towards it and then if they – the patient – is asked beforehand to pay the difference and agrees, where is the problem?
Ah no, say the insurance company, you can’t do that for that is above our stated fee schedule so you are risking your recognition with us if you do.
This article is not about if they are right to potentially withdraw recognition if fees are not adhered to.
Neither is it about whether XYZ Insurance is right to reduce the fee.
The first thing consultants will all do is be deeply unhappy about the reduction.
The second thing they will do is attempt to mitigate the loss somehow or another.
And the second point is the more relevant one.
Many times I hear from insurance companies the market is contracting and cost has to be taken out to make the private medical insurance offering more attractive.
But why is the cost reduction, or so it appears, being continually directed at the consultants?
Yes, I am aware that certain fees have gone up but overall fees have come down.
I’m equally opposed to those consultants who insist on ignoring insurance companies’ fee structures for every single procedure and/or episode.
I’m also very focused on taking costs out of any business so I can see where the insurance companies are coming from.
But not at the expense of continually reducing a consultant’s fee and thereby reducing his profit continually AND the patient’s right to a choice.
Top Up or Gap invoices are a reaction to consultants continually seeing their fees being eroded.
I haven’t said I completely agree with them for they should be unnecessary.
What I am saying is that I understand why I’m being asked to produce them and when.
Consider an actual quote to me recently from a very well established consultant surgeon.
An orthopod who has been in private practice for over 10 years:
That, perhaps, sums up precisely why some MHM clients are asking me to produce Top Up or GAP invoices.
pete@medicalhealthcaremanagement.co.uk
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There are only 24 hours in a day.
All of my guys are incredibly busy.
I’m amazed at the volume of work they get through in a single day.
They are either on-call, doing a ward round or in theatre. Then they have to see their private patients.
That explains why most of them call me either very early in the morning or in the evening.
It doesn’t bother me.
It’s my job to fit in with them and make their life easier.
Recently, however, I was asked to review the private practice of a consultant who was having serious difficulties generating any cash into his practice.
And following my question to his long-suffering medical secretary, it didn’t take long to establish why.
The question was: what is the biggest problem you have this week. The reply said it all:
“I never get a response to the queries or receive the information I need after I’ve asked Mr. Surgeon. He always seems too busy to deal with the things I need”
Yet most of the information the med-secretary needed was fundamental to generating cash into the practice.
For example: two clinic lists from last week were still unprocessed (result: no invoices sent out) or remittances from an insurance company (no idea who had or hadn’t paid) or the post Mr. Surgeon picked up and put in his bag one day last week (it had cheques from patients in it)
So I spoke with Mr. Surgeon and asked him what he thought about it.
His response was a classic:
“I just don’t have time to deal with all that. My private patients are paying to see me so they must come first”
The stark reality is he is right enough to be dangerously wrong.
He is right as regards putting the patients first but he needs to ensure his administrative support is first rate too.
The reason Mr. Surgeon is having difficulty generating the cash due is in him not dealing with such issues as the missing clinic lists or not passing over remittance advice.
Mr. Surgeon needed to make very sure, the support facilities of the practice were dealt with.
The word “support” suggests these things can be demoted to a “Too busy to deal with that and they are not that important so I’ll deal with it later” category.
Eventually, they catch up with you.
In the case of Mr. Surgeon, they were the reason he was struggling to generate cash into his practice.
Compare and contrast that with another real-life MHM client: Mr. B Surgeon.
He is very different from Mr. A Surgeon save curiously they see a similar number of patients each week and are in theatre on the same day too (but in different parts of the UK)
Mr. B Surgeon will send his clinic list the day he sees his patients.
His theatre lists arrive the same day too.
All of which means his invoices are out the proverbially electronic door within 24 / 36 hours.
In the unlikely event, there are queries, a response comes back to me either that same day or at the latest the next. His cash flow is many, many times greater than Mr. A Surgeon.
In case you are wondering why I don’t have such issues with MHM clients its because every single week my clients take their post or clinic lists etc scan them to me and promptly proceed to forget about them thereafter.
pete@medicalhealthcaremanagement.co.uk
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Every single consultant I’ve ever met is dedicated to patient care and the best possible outcome for his or her patient.
But sadly that has little to do with the outcome of the practice as a business.
They may think it does.
But it doesn’t.
Patients reviews are ALWAYS good and they reflect the clinical outcome.
Potential patients do actually read them and take the decision to see a consultant based, in some part, on good patient reviews.
But other than that, there are numerous other items impacting the business outcome.
Planning has a HUGE impact on the outcome.
Specifically, if you don’t have a plan you won’t be able to know if you have achieved the desired outcome anyway.
But what needs to go into the plan?
Sounds crazy but the aim of the plan should be to achieve the outcome, yet you can’t reach the outcome until:
a) you define what the outcome should be
b) you define the plan to achieve the outcome.
Just talking about it won’t be enough. It never is.
Unfortunately, far too many consultants start a private practice without deciding what their desired outcome is. Instead, they make reference to “making more money” or “seeing more patients”
But the smarter ones start by saying I want to make, for example, £5,000 a month (outcome) so I need to see at least 20 patients during that month.
It matters little if it’s £5,000 or £25,000.
What matters is they have a defined outcome with a plan to get there.
Then they start giving immediate thought and planning on how to see 20 patients a month.
None of which has anything to with clinical outcome!
pete@medicalhealthcaremanagement.co.uk
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