Appendix A Summary of Performance Indicators

Financial Indicator Gross charges per physician Measures Productivity by physician Importance Used to demonstrate equitable workload or contribution by physician Measurement Gross fee for service charges + capitated revenue converted to a fee for service equivalent total FTE physicians Net fee for service charges + capitated revenue converted to a fee for service equivalent total FTE physicians Compare the percentage of cash collected to established averages per day. Accounts receivable Net revenue for period / total days in period

Net revenue per physician

Productivity by physician

Used to demonstrate equitable workload or contribution by physician. This ratio is different in that contractual allowances are deducted. Revenue is the key indicator for the practice. It is important to monitor collections. Key indicator in managing cash flow and in identifying issues with various insurers, the business office delays, etc. Key indicator in managing cash flow and in identifying issues with various insurers, the business office delays, etc. Makes it very clear how much the physicians are losing due to failure to collect accounts receivable. Key indicator in managing cash flow and in identifying issues with various insurers, the business office delays, etc.

Patient receipts

Revenue for the practice

Days in accounts receivable

Measures how long it takes on average, to collect an account once billed Measures how much of the years revenue is still unpaid

Percentage of revenue in accounts receivable Bad debt per physician FTE

Accounts receivable Net revenue

Measures write-offs by physician

Accounts receivable distribution

Percentage of dollars Less than 30 days 31-60 days 61-90 days 90-120 days Over 150 days Measures how many encounters each physician is handling on average

Evaluate by insurer or patient. Perform research to see if there have been denials or errors made by staff.

Encounters per physician FTE

Clarifies an expectation of the workload by physician. Use to measure against physicians productivity

Encounters Physician FTE

Financial Indicator MD expense as a percentage of total expenses

Measures How much of the practices total expense represents payments to physicians

Importance Varies according to specialty but commonly 50%-70% of all receipts should be for physician salaries and benefits Helps practice management understand how the practice is doing against others of the same type and size. MGMA publishes benchmarks by specialty. Operating expense (not including physician compensation) are paid before the final level of physician compensation can be established. Note that any of the individual expense or groups of expenses such as staff salary and benefits and be computed by physician FTE. Helps practice management understand how the practice is doing against others of the same type and size. MGMA publishes benchmarks by specialty. Helps practice management see which revenue or expense items are either over or under budget. Helps to narrow the focus for corrective action.

Measurement Physician salaries and benefits Total expenses

Operating Expense per FTE physician

Measures operating expense per physician

Operating expense Physician FTEs

Individual expenses as percentage of total expense

Individual category of expense as a percentage of total expense

Individual expense line item Total expense

Budget to actual

Compares budgeted amounts to actual for revenue and expense accounts

Actual expensebudgeted expense budgeted expense

Operational Indicator Employee turnover by office staff, clinical staff and ancillary staff

Measures

Importance

Measurement

How often the practice is hiring new staff members

Delay in scheduling patient visits

Backlogs which can and could create patient dissatisfaction and loss of patients Customer service

Every new employee has a learning curve and if the turnover rate is higher than the standard expectation (20%) it is an indication of poor selection or an operational problem which needs examination Reflects the efficiency of the office, good customer services and more expedient medical care.

Number of total employees number of terminations in one fiscal year

Date of call to date of appointment

Wait times in waiting room

Reflects the efficiency of the office, good customer service. Also reflects proper planning for time required for types of visits and focus by provider on adhering to scheduled time of visit. Affects patients, hospitals and physician satisfaction. May indicate that staff should be aware of the need to answer more timely. May need to add phone lines. Affects patients, hospitals and physician satisfaction.

Time of appointment to time seen

Number of rings of office phone

Responsiveness

Number of rings (no more than 3 should be the benchmark)

Time to return phone calls

Responsiveness

Difference in time received to time returned. Calls should be returned within 2 hours. Difference in time received to time returned. Pages should be returned within minutes Minutes on hold Time from dictation to transcription or information place in chart. Time from test to delivery of results

Time in returning pages from the hospital Time patient is place on hold Dictation to transcription Dictation to placed in chart Ancillary test result turnaround

Responsiveness to hospital staff needs

Affects patients, hospitals and physician satisfaction.

Responsiveness Practice efficiency

Affects patient satisfaction Information needed to insure patient care and proper billing

Clinical Indicator Mortality

Measures Quality

Importance Indicator reflects the quality of care provided. It is publicly reported. Any percentage above MGMA or other national benchmarks calls for corrective action. Same as above

Measurement Number of deaths Total patients

Return to surgery within 24 hours or 30 days

Quality

Numbers of patients returning to surgery within 24 hours (30 days) total surgery patients Numbers of readmits to hospital total patients discharged Number of complications Total patients Number of patients with infections Total patients

Readmissions to the hospital within 30 days Complications

Quality

Same as above

Quality

Same as above

Infections

Quality

Same as above

Many of these indicators are measured in aggregate by MGMA.