Why Does Your Practice Employ You? - For Physician Assistants

By Abby Jacobson, MS, PA-C

Why does your practice employ you? Can you answer this question? Employing PAs has many benefits, but of course, patient access to care always should be the primary objective when a practice or a hospital decides to start utilizing PAs. Improved physician quality of life is another reason. Nevertheless, the financial benefits of employing PAs cannot be overlooked. Besides offering high-quality patient care, you are a financial asset to the practice.

But how much of an asset are you? The easiest way answer this is to know how much money you bring into the practice. Here are tips to remember when determining how much of a financial benefit you are to your employer.

Ask for Your Data

You need to know how much you bill each month and how much is collected from those charges each month. I strongly recommend your physician assistant employment contract state that you will receive monthly (or at least quarterly) reports of your billings and collections. Ask for this data now. Don't wait until it's time for contract negotiations.

Be careful to not appear greedy or selfish when asking for this information. If you say you want the data to see how much you are making for the practice, implying that you will use the data during your next contract negotiation, you are already creating an adversarial situation and setting the stage to be denied access to the data.

Instead, explain that you want this information to review for consistency, to ensure that the practice is getting paid fairly from insurance companies, to review for compliance with reimbursement rules, to evaluate worthwhile contracts with particular insurance companies and to see whether your productivity for the practice is comparable with your colleagues.

Have you asked for this data in the past and been denied? You have a few options. A number of formulas are available to help you try to track collections, or you can calculate some average per-patient charges. Or you could use information collected from other PA colleagues who practice in a setting similar to yours. It's more difficult, but it can be done. But consider that if a practice is keeping this data from you, what else are they hiding? If your practice won't share this information, I think you need to ask whether this is the right practice to stay in.

Ask for Colleagues' Data

It's very helpful to know what other providers in your office are billing and collecting. This includes the physicians, PAs or nurse practitioners in your practice. Some professional societies, such as the Society of Dermatology Physician Assistants and the Medical Group Management Association, track average billing and collections as part of their salary surveys. If you are under-producing compared with your colleagues, you need to fix the problem. Are you not seeing enough patients? Do you need more support staff? Are you undercoding or overcoding? Do you need to start offering more procedure-based services?

Code and Bill Properly

The most important step in being a financial benefit to your practice is proper coding. As boring and difficult as it seems, you have to know when and how to use the proper codes to bill for the services you provide. You need to know everything from the appropriate level of evaluation and management visits (what makes a 99213 different from a 99212?) to when and how to use a modifier. Unfortunately, this stuff changes regularly, and you need to make it a priority to review it at least yearly.

The second step is to communicate with your billing department staff. Make sure they know how to submit claims properly, that they do it in a timely manner and that current information is collected on your patients. Ask them how rejected or bundled services are handled, and what is done for outstanding patient balances.

For example, one of my PA clients just found out her practice has been writing off charges when a patient's insurance has a deductible, regardless of whether the patient can pay or not. Her billing staff never even asks the patients for their portion! So the practice is losing hundred of thousands of dollars each year, and the PA is providing free care 25% of the time to a population that could pay at least a portion of their deductibles. You must be involved in the office coding, billing and collections from A to Z.

Know Your Billing-to-Collection Ratio

I recently was working with a client on her contract negotiations and we figured out that her accounts receivable (AR) rate was 48%, meaning that of everything she billed, less than half was ever collected! That's far below the average benchmarks for a strong practice with a good billing department.

To calculate your practice's AR rate, divide your collections by your billings and then multiply by 100 to get a percentage. So, for example, if you billed $300,000 and collected $215,000, your AR rate is 71.67%. Compare your rate to the other providers in your office and to other similar practices.

Are Charges and Collections Tracked?

With today's computers and electronic medical billing, there's no excuse for a practice not to keep track of your charges and collections. Even if services are billed out under your physician, you can put an internal code on them to track them. If your billing department or office manager doesn't know how to do that, offer to call the computer software company yourself to find a solution.

It does become more complex if you never see patients directly or if you spend at least part of your time doing things that won't result in a charge, such a pre-rounding, taking call or assisting during procedures. In this situation, you need to attempt to calculate whether these duties enable your supervising physician to bill more. For example, if you help the physician pre-round, does this save him an hour a day? And if he uses that hour to see patients, how much more has he collected? Or if he can perform two more surgeries a day because you speed the procedures, how much more money do those two surgeries a day bring in?

Start with a strong, ironclad contract, and pay attention to your gut-if you sense red flags, beware! Before accepting a position, find out about the practice's reputation. Seek opinions from former employees (especially PAs) and from referring clinicians in the community. Research the salaries of other PAs in similar settings. If you're being abused, look elsewhere. Change can be scary, but sometimes it's necessary.

By becoming involved with the billing and coding in your office, you can help your physician navigate the confusing and complicated work of running a medical practice. Doing this will give you an advantage in contract negotiations, and you'll also help your physician in yet another way that PAs can benefit their physician partners in medicine.

Abby Jacobson practice dermatology in Lancaster, Pa. She has held numerous leadership positions in the American Academy of Physician Assistants, the Pennsylvania Society of Physician Assistants and the Society of Dermatology Physician Assistants. She is owner of Strategic Medical Consulting LLC.

Copyright ©2008 Merion Publications