“Tracking and monitoring KPIs and revenue cycle management (RCM) metrics are essential to informed decision-making.” ~ Revenue Cycle Management (RCM) Best Practices for Enhanced Dental Practice Performance white paper
But how do you establish a seamless tracking and reporting process to support timely and accurate decision-making? Here’s a 5-step action plan to help you set a solid foundation:
Identify RCM metrics, or key performance indicators (KPIs), that align with your business objectives and impact your revenue directly or indirectly. You should be able to collect the data automatically through your billing, EHR, and dental practice management software to ensure accuracy and cost-efficiency.
Then, create a plan to track each KPI automatically to ensure timely and accurate insights — don’t rely on manually updated spreadsheets! Also, support continuous monitoring by setting automated alerts and reporting for critical metrics. Regularly review and audit your KPIs to ensure they align with your strategic objectives and priorities.
Establish benchmarks and targets to assess progress for each metric you’ve decided to track. First, thoroughly understand each metric’s current performance. Collect historical data and analyze trends to identify patterns and areas for improvement.
Then, research industry benchmarks and standards relevant to your dental practice. Establish baselines to define what is achievable and realistic within your field and for your practice. Your benchmark should account for your practice’s characteristics and circumstances, such as size, specialty, and location.
Establish realistic timeframes for achieving these benchmarks. Also, ensure each benchmark directly supports to a strategic goal. For example, set benchmarks related to reducing accounts receivable aging if the objective is to improve cash flow.
Does your dental practice management software (PMS) offer data collection and analytics capabilities for tracking metrics and generating reports? Otherwise, you may need to add these functions by implementing a data warehouse and business intelligence software.
While third-party integrations may give you access to more functionalities, they often increase costs, complexity, and data security risks. On the other hand, an integrated PMS like tab32 has all the data warehousing and analytics capabilities — designed specifically for dental practices of all sizes, even with multiple locations.
Our data analytics module integrates with the rest of the platform, including EHR, billing, and scheduling features, to automatically collect data from all aspects of your practice to establish a holistic view of your RCM practice. Meanwhile, our Open Data Warehouse enables you to customize reports, eliminate complex processes, and unlock the potential of your data.
Identify primary stakeholders in your RCM process, including billing team, providers, practice managers, and financial administrators. Establish a regular meeting schedule to maintain a focus on continuous improvement. Also, set an agenda that covers reviewing performance metrics, identifying areas where goals aren’t met, and analyzing root causes.
Develop detailed, realistic, and achievable remediation plans for each identified issue (e.g., when metrics drop below a set goal.) They should include specific actions, responsibilities, and timelines. Prioritize resources and tactics based on a remediation plan’s impact on practice performance and financial health. Assign responsibility and track progress to ensure accountability.
You may consider tying performance metrics to team members’ compensation (i.e., performance bonuses) to incentivize the right actions. Define measurable targets for each RCM metric and ensure they’re challenging yet realistic. Also, individual-focused and team-based metrics should have different bonus structures.
Then, determine the bonus system. Decide whether to tie financial incentives to specific metrics, a combination of KPIs, or overall practice performance. Then, establish the percentage or amount for achieving different levels of outcomes.
Communicate the performance metrics and bonus structure to all team members, clarify expectations for each employee, and define what success looks like. Transparency and clarity are essential for motivating and guiding employees to align their actions with your revenue goals.
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