MGMA Shows Keys to Business Success at Medical Groups

A new report identifies best practices in several areas, including accounts receivable, earnings, expenses, and patient access.

A new report from MGMA highlights the best practices of successful medical groups.

The MGMA assigns Better Performer status based on metrics including compensation and production, cost and revenue, and practice operations. The new report is based on information collected from 4,098 organizations, with 1,129 identified as Better Performers—a 36% increase compared to organizations that earned the Better Performer designation in 2021.

Better Performers excel in accounts receivable, the report says. "Across the board, Better Performer practices collect more A/R in the first 30 days compared to all practices, with the biggest difference (nearly 9%) occurring in primary care collections made in the first 30 days. Primary care Better Performers also had the biggest difference in outstanding A/R in the 120+ days bucket."

Michelle Mattingly, director of data solutions at MGMA, told HealthLeaders that there were three primary commonalities among Better Performers that excelled in accounts receivable.

• An emphasis on collecting accounts receivable in the first 30 days of billing, leaving less dollars to be collected in the past due buckets such as 120+ days in accounts receivable
   
• Use of a claim scrubbing tool to catch clerical and coding errors 
   
• Running monthly accounts receivable and separate out insurance and patient balances by service date

There were three primary commonalities among Better Performers that succeeded in posting high earnings, Mattingly says.

• Better Performers will often show slightly higher total operating cost per full-time equivalent physician 
   
• Investments in areas such as staff, medical supplies, building occupancy, and equipment typically help produce greater revenue in Better Performer organizations
   
• Better Performers follow the adage that you have to spend money to make money

With pandemic-related constraints such as higher labor expenses, Better Performers posted lower expenses compared to their counterparts. Two factors were primarily responsible for driving down expenses at Better Performers, Mattingly says.

• In some cases, attrition helped practices avoid steep rises in labor expenses 
   
• Practices experiencing staffing shortages did not have staff to pay, so they saved on an expense they would have had otherwise

Staffing shortages have put a strain on patient access such as creating longer appointment wait times. There were four primary commonalities among Better Performers that were able to hold the line or improve patient access, Mattingly says.

• Better Performers had a higher percentage of same-day appointments
   
• The third next available appointment for new patients was up to four days sooner at Better Performers compared to other practices
   
• New patients were asked to fill out electronic forms prior to their visit
   
• Better Performers hired part-time remote staff

Related: MGMA Highlights Keys to Success for Physician Practices