Tracking Medical Practice Contracts

A healthy practice is one that manages its contracts (vendor contracts, service agreements, and leases) well.  Many physicians and practice managers, however, are running nonstop and have never taken the time to track their practice’s contracts.  Just as clinical pathways promote organized and efficient patient care, effective contract management promotes organized, efficient, and cost-effective practice management.  Keeping track of contract renewals can be tedious. Whether practices renew such contracts all at once, or throughout the year, there are techniques to simplify the task.

There is actually a fairly simple method for headache-free contract tracking.  I have found that using an Excel spreadsheet in conjunction with Outlook tasks is a proven system to accomplish this.  Many contracts are auto-renewing (known as “evergreen”), meaning that once they are signed, they don’t terminate after a certain period but rather continue in effect.  Most people get so busy with their practice that after signing the contracts, no one is diligent about reviewing the agreements on an annual basis.

Here are the key items to include in the spreadsheet:

1.  A list of all of your contracts

The spreadsheet should contain all contracts, including leases such as property leases and copier leases as well as service agreements and vendor maintenance agreements such as janitorial, landscape, etc.

2.  The date each contract is up for renewal

The first date to be listed on the spreadsheet is the date the contract is up for renewal.  Be sure to make a note if the contract is auto-renewing and if this is the case, a separate “notification trigger” date should be included.

3.  Notes regarding mandated price increases

When reviewing the contracts, take note of any automatic price escalators and if this is part of the contract, a brief note should be included in the spreadsheet.  The purpose here is to remind you next year that this contract not only is coming due for renewal, but also has a mandated price increase.  This will allow you time to negotiate, shop around, or cancel your current agreement.

The spreadsheet is a central repository for summary details of your contracts/agreements/leases.

After you create the spreadsheet:

Make note of any of the dates included in the spreadsheet in your Outlook calendar. Outlook gives you the ability to effectively manage contract milestones via automated alerts.  Based on the dates you have listed in the spreadsheet, you can set up reminders to negotiate rates (taking advantage of renegotiation windows to improve terms); cancel if so desired (without triggering any fees); or put it out for bid (if reminders are set up with enough advance notice).

Going above and beyond:

It is also advisable to digitize the contracts and store them as well as the spreadsheet on a shared drive where access can be granted to select members of the practice.  When setting up the Outlook reminders, you may also want to ensure that more than one person receives the alerts.

Setting this up for the first time can be time-consuming and with busy practices that are often short-staffed, this may be something worth getting a consultant to set up for you initially.  Then, you can monitor it yourself on an annual basis.

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Contact ABISA, a consultancy specializing in solo and small group practice management.  Visit us at ABISALLC.com.

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Medicare Advantage Fines

Medicare Advantage plans are being fined by the Centers for Medicare & Medicaid Services (“CMS”) at a record pace. In the first quarter of this year, CMS has levied $2.5 million in fines on ten plans as the agency attempts to tighten the noose on bad practices. The top penalty for this first quarter went to Citizens Choice Health Plan which is based in Orange, California. CMS stated this particular plan’s fines were based on inappropriateness of prescription drug denials to their Medicare members.

CMS has also imposed sanctions on some plans as a stricter form of punishment. While a health plan is under sanctions, their star rating is reduced to 2 ½ stars. Medicare Advantage plans who do not have a four star rating forego bonus payments from CMS.

CMS appears to be ramping up their enforcement efforts into the second quarter of 2015. Most notably is an April fine issued to Aetna in the amount of $1 million.

Modern Healthcare recently produced a top 25 list of Medicare Advantage insurers, ranked by total enrollment as of March 2015. The top ten in the list are:

  1. UnitedHealth Group
  2. Humana
  3. Kaiser Foundation Health Plan
  4. Aetna
  5. Anthem
  6. Cigna Corp.
  7. Blue Cross and Blue Shield of Michigan
  8. WellCare Health Plans
  9. Highmark Health
  10. Health Net

This list of plans above currently enroll nearly 11.6 million Americans.

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Contact ABISA, a consultancy specializing in solo and small group practice management. Visit us at ABISALLC.com.

Unchaining Nurse Practitioners

Nebraska and Minnesota have recently joined the ranks of other states in allowing nurse-led outpatient clinics. Nebraska’s law became effective March 20th and Minnesota’s law is effective April 6th. Nurse-led clinics allow nurse practitioners to operate without a physician’s oversight and thus the issue has been hotly contested by physician’s lobbies for years.

There are now over 250 nurse-led clinics across the country, with some two-thirds of those clinics being affiliated with universities. The states that currently grant full independent practice rights to nurse practitioners are:

  • Alaska
  • Arizona
  • Colorado
  • Connecticut
  • District of Columbia
  • Hawaii
  • Idaho
  • Iowa
  • Maine
  • Minnesota
  • Montana
  • Nebraska
  • New Hampshire
  • New Mexico
  • North Dakota
  • Oregon
  • Rhode Island
  • Vermont
  • Washington
  • Wyoming

Approximately 16,000 nurse practitioners graduate each year in the U.S. Many are looking to nurse practitioners (and their expanded role) to help fill the shortage of physicians and the expanded health coverage under the Affordable Care Act.

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Contact ABISA, a consultancy specializing in solo and small group practice management. Visit us at ABISALLC.com.

Surgeons: Like a Fine Wine

Do surgeons become better with experience? Is there a point where their level plateaus? A recent study sought to answer just these types of questions.

The study, published in Annals of Surgery, examined over one million surgical cases performed by nearly 18,000 surgeons in 14 countries. Results showed that patient outcomes do get better as surgeons gain more experience but only up to the point where the surgeon’s level of learning plateaus. This learning curve has been found to mature in somewhere from 25 to 750 cases, depending on the types of surgery and the individual physician.

This large review analyzed data from 57 different studies, looking at the number of years in practice and the amount of surgeries performed in many instances. Approximately 3% of the studies demonstrated a learning curve with some physicians, which varied by procedure. In 77% of the studies however, the authors noted several items which improved as the corresponding number of surgeries increased. These areas of improvement include:

  • Complication rates
  • Mortality rates
  • Stroke rates
  • Length of procedure time
  • Requirements for blood transfusions
  • Rates of recurrence

The authors of the study also suggested that “performance may deteriorate toward the end of a surgeon’s career.” And while they noted the deterioration can come with a significant detriment to patient outcomes, surgeons can help offset this by staying abreast of trends, data, and best practices within their field.

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Contact ABISA, a consultancy specializing in solo and small group practice management. Visit us at ABISALLC.com.