Whether you manage a small physician practice or work with a large group, financial dashboards are the lifeblood that help you:
- Develop attainable goals
- Measure progress
- Forecast future performance
- Identify trends and areas of opportunity for growth
- Give guidance to providers and staff to help them achieve practice goals
But dashboards need to be timely, easy to read, and contain the right combination of information to help you evaluate your practice's overall financial health. In addition, dashboard reports must be generated at the appropriate time intervals to give them real meaning in the context of your practice's performance.
Here are some tips to help you incorporate meaningful financial dashboards in your practice management routine.
What KPIs should you be tracking?
While not every practice operates in the same way, the meaning behind most KPIs remains the same. For example, a large hospital practice may track productivity by relative value units (RVUs), while a private practice measures net collections, but they are both concerned with revenue generation.
In general, your dashboard KPIs will fall into one of three categories:
- Productivity and financial data: This segment includes raw performance indicators, such as number of visits, revenue generation, expenses by category, profit and loss statement, cash flow analysis, balance sheet data.
- Revenue cycle management: Indicators in this category include collections, A/R aging, contractual adjustments, days sales outstanding (DSO), net collections percentage, A/R percentage of gross charges.
- Patient, provider, and payer profile data: You'll want to track your patient mix, charges per patient, revenue per capitated and FFS patient, new patient/existing patient ratios, no-shows, revenue and adjustment ratios by payer, RVUs/charges by provider.
The important thing is to select KPIs in each category that represent the needs of your individual practice and overall financial goals.
Related Article: 12 Tips to Reduce AR and Increase Medical Practice Profitability
How should you arrange your dashboard data?
The key to successful financial dashboards is to keep them simple. In some cases, you'll be pulling canned information from a remote billing system and in others, you'll be pulling up-to-the-minute data directly from your internal practice management system. In all cases, however, you'll want to keep dashboards short, ideally fitting on a single screen or page, to prevent data burnout.
In addition, you'll want to establish a reporting frequency. What information does your practice need in a daily "flash report" to uncover actionable data? What information is required for monthly and quarterly dashboard reporting? Do you need micro-level reports on a real-time basis throughout the day?
Finally, you may want to consider segmenting data into compartmentalized dashboards by department, medical specialty in a multi-specialty group, location, etc. For example, your billing department may benefit from segmented coding and adjustment dashboards to help spot trends with specific payers or providers.
Building the bridge between data and dialog
Ultimately, your financial dashboards should give you meaningful data to benchmark your practice against national averages to identify areas for improvement and growth. It should also help you measure performance against forecasts and allow for more accurate budgeting and financial forecasting.
It should also offer an opportunity for providers and financial managers to view practice data from a new perspective and serve as a natural starting point for internal dialog and cooperation. In many practices, the dashboard data opens up more realistic discussions to help align practice financial goals with clinical performance. As reimbursement rates continue their downward spiral, these are conversations every practice needs to have in order to maintain financial health.
If you have questions about your financial data or setting up dashboards to measure and track your performance over time, contact the billing specialists at M-Scribe today for a free billing analysis.