Medical Practice Performance
Taking time to evaluate your medical practice performance may seem unnecessary when your waiting room is full of patients and your staff is busy every minute. However, external signs may not be true indicators of how well your practice is doing.
How can you judge medical practice performance? In the corporate world, companies frequently use a process called benchmarking. In short, benchmarking is the process of comparing one organization’s practices and performance measures with those of successful organizations in the same field.
You can also use benchmarking to help your medical practice uncover weaknesses, improve strengths, and set goals for the future.
Internal Benchmarking
You are probably already using some basic benchmarking techniques. Comparing your practice’s current financial data with data from past periods is internal benchmarking. Reviewing and comparing performance on a regular basis can help you uncover trends and address irregularities before they grow into serious problems.
External Benchmarking
With external benchmarking, you compare your performance data with data from other practices to give you an idea of how your practice compares with others in your specialty. This type of benchmarking provides valuable insights and reference points for improving efficiency and performance.
Data for external benchmarking are readily available from professional organizations and other sources. It’s important to note that some data sets represent industry averages, while others offer performance numbers for industry leaders. If your goal is to improve performance at your practice, using average data for comparison may be counterproductive.
Getting Started
So, how healthy is your medical practice? Benchmarks can be used to evaluate almost any aspect of medical practice performance. Including clinical care, financial management, staff productivity, and patient satisfaction.
Although benchmarking may seem daunting at first, begin by focusing on the areas of your practice that you believe are most important and require the most attention. For example, if you’re concerned about reimbursements, start there. Or if you think your staffing levels are high, find out by comparing your figures with those of similar practices.
Much of the financial data you already collect will be useful. However, if you want to measure performance in areas where you aren’t currently collecting data, new procedures will have to be established.
If you want to see the benefits of benchmarking from a professional, a CIG Business Advisory professional can help.
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What the Numbers Say
Every medical practice is unique, and changes will occur over time. Keep this in mind as you compare your numbers with various benchmarks, and make adjustments where necessary. For example, if your practice recently relocated or you converted to an electronic health record system this year, some data will not be typical.
As you compare your numbers with various benchmarks, a picture of your strengths and weaknesses will emerge. Use that picture to establish action steps and set goals. For example, if you discover that your overhead expenses are twice as high as other similar practices, find out why and take steps to correct the problem.
Looking Ahead
Benchmarking is not a one-time event. It’s a valuable tool you can use on an ongoing basis to provide your practice with essential performance information. Benchmarks can also provide helpful guidelines when something in your practice changes.
Yes, benchmarking requires an investment on your part and a commitment of time — but it offers your practice the opportunity for substantial gains. If your medical practice would benefit from the insights of a benchmarking analysis, CIG Capital Advisors’ Business Advisory Services professionals can help.
Click the button below to schedule a complimentary consultation with a CIG professional today
