As political debate continues to swirl around the future of the healthcare system in this country, physician revenue streams are becoming more uncertain than ever before. Physician practices are being pressured by hospitals to be bought up. Insurance companies are bargaining harder than ever to negotiate cuts in reimbursement rates. All of this threatens to decrease the revenue stream and quality of life of physician practices everywhere. Because of this, many physician practices have decided to start offering ancillary services. While this could result in an increase in the revenue for a physician practice, it might be time for physicians to rethink and reconsider these alternative revenue streams.
The Risk of Offering Ancillary Services
Many physician practices have brought many of the services that used to be offered by large, third-party companies in-house. Services such as lab work, EKG testing, and radiology scans have been brought into physician practices as a way for practices to generate revenue in addition to patient care; however, there are some dangers with offering these services.
Who Can Offer These Services?
One of the common questions regarding ancillary services is who is able to offer these services? Unfortunately, these qualifications can vary widely from state to state. Physician practices may need to hire additional personnel with certain degrees to run this equipment. If these qualifications change over time, physician practices may need to hire additional personnel to offer these services. For example, what happens if the state board requires a graduate degree to run certain tests in a lab? This could result in an increase in overhead costs if additional personnel need to be brought on board.
Reimbursement Rates are Still Subject to Change
In addition, insurance companies negotiate reimbursement rates for these services just as they do other services. For example, Medicare may cut the reimbursement rates for x-rays by 20 percent in 2017. This could shrink the margin of these ancillary services. Therefore, physicians may want to reconsider whether or not offering these ancillary services is worth it.
What Should Physician Practices Do?
With a number of important questions facing physician practices with regard to ancillary services today, what should physician practices do to maintain their revenue stream? Overall, they should treat ancillary services with the same attention to detail that they give to patient care.
Check the Numbers Carefully
Before spending the overhead costs to open a lab or order a new MRI machine, it is important for physician practices to look at the numbers carefully.
- How many other locations in the area can patients go to for these services?
- What does the demand look like in the practice for these services?
- What would the cost of hiring personnel to run these services be?
- Has the reimbursement rates for these services been going up or down in recent years?
These are basic numbers that every practice needs to consider carefully before offering an ancillary service. Make sure to consider all facets before making an investment.
Related Article: How to Increase Revenue of a Clinic or a Physician Practice?
The Practice is a Business
Of course, physicians who run their own practice understand that they’re also running a business; however, offering ancillary services means that the practice must be able to sell these services to patients. Physicians must be able to convince not only the insurance companies but also the patients that these services are important to their overall health. This is how physicians can make their investment worth it.
Delegate When Possible
Physicians will need to fight for reimbursement for these ancillary services just as they will with patient care. It might be helpful to consider delegating the billing and coding of these services to a companies such as M-Scribe. M-Scribe professionals have the experience and expertise necessary to ensure physicians maximize the reimbursement rates for their practice. Contact M-Scribe today for more information.