This is the third blog in a 4 part series of articles based on an interview with Paul Christensen, DPT, OCS, ATC, FAAOMPT.  Paul is the founder of OPTM Physical Therapy Group with office in San Jose and Los Gatos California and is on the Clinical Advisory Group for Clinicient. In previous posts, Paul talked about how identifying the right problem and practice reputation influence no show rates. This is a continuation of our discussion.

What are some of the important metrics that you monitor?

I am not Rumpelstiltskin, in other words, I can’t make gold from straw, so I count revenue, not patients. Important metrics have to be monitored on a weekly and monthly basis or you will get buried.

I monitor physician referrals, but I not only monitor for physicians that quit referring, I also try to understand why a new referral source started sending patients to us. If you don’t find out why physicians start sending referrals, you won’t know what happened if they quit sending referrals.

I also monitor our average visits per discharged patient and right now it is 9.8.  I like to see that number between 9 and 11.  If it is too low, it might be an indicator of poor patient satisfaction.   Too high may indicate that over-utilization.

How do you handle therapist vacations?

Again, it is all about thinking about this from the patient’s perspective.  For example, if a therapist is leaving on vacation and tells the patient to hold on therapy in their absence rather than seeing another staff member, it is like saying “Being treated by anyone else in this office is worse than not being treated at all.”

If a PT is going to be out on vacation, they should talk to the patient about it, tell the patient about the therapist who will be covering, and tell the patient that the covering PT will be briefed on the patient to ensure there will be continuity of care. After briefing the PT who will be covering the case, introduce them if possible. We need to show patients that we care about them and their well being. (that should be the first goal on everyone’s mission statement!)

The PT’s words are the most influential words spoken in the practice. The patient perceives the receptionist as just trying to create revenue for the practice, while the PT actually cares about them. The result is the patient will happily schedule with a different PT, and if they really don’t want to, then that’s ok. Goal achieved with a different perception.

Physical therapists need to get over this “continuity of care” issue. I have seen a lot of bad “care” continued because the PT was too insecure and proprietary about their patient to ask for a new set of eyes to look at the patient. We can all learn from each other and we should be excited about nurturing our collegial relationships. We can also use this as an opportunity to manage and educate when what you learn is that one of your staff if not attending to the needs of a patient.

In the last article in this series, Paul will talk about how he coaches his front desk staff to manage the schedule.

The intent of a clinical service that you provide to your patients is a big part of establshing the medical necessity of your services.  It can be a bit tricky, because the same basic procedure may be performed on different patients for different reasons.  You want to make sure that the description of the procedure supports the intent indicated by the procedure code.  If the same clinical service is used for multiple different intents, the name of the clinical service should be changed to support the procedure code submitted on the claim.

Let’s use an example to illustrate.  A therapist may document that they worked with the patient on a step down exercise for at least 3 different reasons:   strengthening (which would support using the 97110 procedure code), neuromuscular re-ed (97112), or gait training (97116).

Here is how the name of the same basic procedure may be changed slightly to support the intent:

• Step Down for Balance Training (97112)
• Step Down for Gait Training (97116)
• Step Down for Strengthening (97110)

The procedure code should not change based on what “pays the best”.  Your documentation should accurately reflect what was done and why.  Otherwise, you will have a difficult time supporting medical necessity.

We have developed our system so that you have complete control over the content in your own content library.  This allows you to associate the correct procedure code with an accurate description of the procedure that supports the use of that code.

I just got off the phone with a business owner who’s facing a 16% reduction in fee schedule from his largest payer who accounts for 17% of his overall visits and 20% of overall revenue.  He happens to be in a region that is still experiencing a relatively high (compared to the National Average) payment per visit of nearly $100 per visit.  Unfortunately, this was one of his best payers: paying an average of $117 per visit. He asked if I had any ideas from my conversations with other owners who had faced or were facing the same issues. Unfortunately, this conversation is all too common, but armed with some analytics, we were able to look for ways to offset the impacts of these cuts.

Quantify the Impact
The first order of business was to determine how much this change would impact his bottom line. Right away we checked his Payer Mix report to determine how much of his business was from this payer. Within seconds we determined that 17% of his overall visits come from this payer. Then we looked at his average payment per visit from this payer using the Expected Revenue reports (it’s important to make sure you’re looking at the actual payment based on fully completed visits). Assuming roughly the same percentage of visits with the same costs of servicing at the new rate, he could expect an overall reduction of 2.7% to his top and bottom line.

Look for Low Hanging Fruit
The next step was to look for obvious ways to increase revenue with the same resources to make up for the roughly 3% pay cut. The first thing we looked for is spare capacity – i.e. unused or unbilled treatment time. It’s important when looking at this time that you look not only at the billable time of therapists, but also the billable time of aides and assistants based on your agreements with payers and the regulations in your state.

The easiest area to target first is under billing – therapists giving away time. Most clinics are under billing by significantly more – usually in a range of 10 – 15%. To accurately track this, you have to track the actual visit time  and the billed time for each treating caregiver.  Fortunately, this clinic does a really good job of scheduling and getting their therapists to track their time. Overall, they had a 95% billable rate for their therapists – in other words, of the total visit time, therapists were billing 95%. That’s very efficient, so obviously these clinical leaders are doing a good job making sure their therapists are accounting for their time. Notwithstanding it’s possible that treating staff could bill 1 – 2% more of their actual visit time and these unbilled minutes can really add up over the course of a year and help to offset the reductions.

According to their data, they had a 19% vacancy rate – in other words only 80% of their staff’s available treatment time was scheduled with appointments. Part of this is due to cancellations. They had a 15.6% cancellation rate – fairly average. There’s a wide variation in cancellation rates by therapist. Clearly some opportunity here for improvement in utilization of therapist time. We’ll have some specific ideas in an upcoming blog on ways to reduce no shows and vacancies. A 3% – 5% increase in visits would make up for the lost revenue and should not increase costs.

Sometimes, spare capacity hides in less obvious places. In this case, we found some interesting findings in the Units per Hour productivity measure. This measure takes the units billed divided by the total available treatment time for each treating caregiver.  Overall, the treating staff were billing 3.97 units per available treatment hour. On the surface, this seems reasonable, but the range was from a high of almost 6 units per hour to a low of less than 2 units per hour. Since Medicare makes up only 12% of his visits, it seemed highly probable that 4 units per treatment hour might be too low (most of their payers do not cap the number of units the way Medicare does, so an increase in units per hour should translate into an increase in payment per hour). Getting the lower performing therapists to a higher unit output could have a significant impact – going from an average of 3.97 units per hour to 4.2 units per hour is a 5% increase in hourly unit productivity which could easily translate into the 3% increase.

Turning Insight Into Action
Without an action plan, all of this analysis would be just a bunch of numbers on a report somewhere. The key to this organization’s continued growth and success starts with the fact that they are a learning organization. They have set up a continuous feedback system to measure the performance of everything that can indicate a change in their performance – their key performance indicators. Now that they’ve got a ton of measured data, they can use the insights gained from analyzing their key performance indicators to drive change in the organization. Because they kept statistics on every visit and payment they were able to quickly assess the financial impact of the change in payer fee schedule. Since they kept rigorous data on therapist schedules and the related billing, they were able to proactively identify ways to improve productivity to offset this negative change. This learning drives continuous improvement and growth which creates a sustainable competitive advantage for their business.

This is the second blog in a 4 part series of articles based on an interview with Paul Christensen, DPT, OCS, ATC, FAAOMPT.  Paul is the founder of OPTM Physical Therapy Group with office in San Jose and Los Gatos California and is on the Clinical Advisory Group for Clinicient. I recently had the opportunity to sit down with Paul and ask him how he manages the no show rate at his clinics. In a previous post, Paul explained how their practice reputation influences their No Show rate.

We already talked about your organization’s reputation in the community.  What about your organization’s philosophy?

If we change our vision of the future we can aspire to those goals and make real change in the world. This applies to the patients and in your business culture with employees. It applies to everyone! If the organization does well, we all benefit.

It is amazing what can be accomplished if you can put aside your ego don’t worry about who gets the credit. If you’re doing an excellent job, everyone will find out anyway.  As an example, I am beginning to think that I am probably not the right guy to hire staff for the practice any more. I am getting older and I’m hiring staff that is 30 years younger than me now. They probably don’t relate well to someone who reminds them of their Dad. I think I need to put aside my ego and let younger clinical leaders in my practice make those hiring decisions.  I try to remember that it is not about who is right, it is about what
is right.  It is not about me, it is about the business.  Everyone benefits if we all do well.

I try to instill an adult relationship with my staff.  This is sometimes a struggle, because, for many of them, it is the first time that they have been treated like an adult.  If you are a practice owner and you feel like you can never go on vacation and leave your staff unsupervised, I believe you caused that problem yourself by not treating your staff like adults with adult responsibilities.

Passion is directly related to the failed appointment rate.  I believe that if you count your blessings, you receive more blessings, and people feel good being around you.  If you are negative it is just the opposite.

This is not a democratic organization, it is a benevolent dictatorship and my staff understands that.  It isn’t that I don’t take their input, but I don’t need a debate about our philosophy.  If we can’t agree on our philosophy, it isn’t a good fit. This is so important to our success that we have monthly
in-services on a Saturday and part of each meeting is always centered around our shared philosophy on patient care.  My staff sometimes asks why we talk about the same things at every staff meeting.  I say “If these things weren’t a continuing problem, do you think I would waste everyone’s time and continue
to talk about it?”

Our treatment philosophy is centered on our patients.  My recurring message to my staff is that we should all stop thinking about what we do to patients and instead think about what the patient needs.  I don’t care about “the how”, I care about results. It isn’t about the therapist, it is about the patient.

Patients will become confused and less satisfied with your practice if the staff doesn’t have a common philosophy. If a patient is being seen my more than one therapist over the course of their treatment, and those therapists don’t have a common philosophy; the patient will become confused and dissatisfied.

I try to communicate to my staff that we sell the most perishable commodity there is: Time.  Everyone needs to understand that a missed visit is gone forever, and it can never be recovered.

In future articles in this series, Paul will discuss how important management metrics and schedule management contribute to the low no show rate at OPTM.

Most healthy physical therapy practices maintain a no show rate of 10% or less. Our customer, OPTM Physical Therapy Group, keeps their rate down to 6%!  This is the first of a 4 part series of articles based on an interview with Paul Christensen, DPT, OCS, ATC, FAAOMPT.  Paul is the founder of OPTM Physical Therapy Group with office in San Jose and Los Gatos California and is on the Clinical Advisory Group for Clinicient. I recently had the opportunity to sit down with Paul and ask him how he manages the no show rate at his clinics.

In looking at your practice statistics, your current failed appointment rate is about 6%.  Most practices are doing good to get their failed appointment rate down to 10%.  How do you do it?

I don’t search for answers; I try to find the right problems.

Huh?

That’s right… If you don’t know right problem, you can’t solve it.

Searching for answers is the wrong place to start.  To be an effective manager, you need to search for the right problem and define it so everyone can understand it.  Finding the right problem is not always easy, but when you find it, there is usually an obvious solution.  In my experience, not many people are good at this. Find the right problems, present them to the group so that they understand them, and the answer is easy.

Do you have an example?

Sure.  This isn’t directly related to failed appointments, but a good illustration of what happens when you don’t find the right problem.

Last week, my office received some feedback from one of our referring physicians that they would like for our plan of care approval form to be included on the first page of our evaluation reports, not the last.  So, we “fixed” the wrong problem by changing the format of our reports so that the plan of care approval was included on the first page.

The physician was still unhappy. I finally found the right problem:  The physician’s document management system wouldn’t allow them to electronically approve the plan of care and return only one page, instead they had to return the entire document and each page costs them 8 cents per page to transmit.  Changing the order of the pages didn’t help. We now send the evaluation report and the plan of care approval to that physician as two separate documents.

OK, so what is the “right problem” you have found that account for your great no show rate?

There isn’t just one, there are several, and I believe that there is a lot more to it than just managing the schedule effectively. Your community reputation, your organization’s philosophy, and constant monitoring of relevant trends are all critical.

Let’s take them one at a time.  What is important about your organization’s reputation?

Obviously, to keep a full schedule you need an adequate number of patient referrals. I have some advantages here because I have been in community for 32 years.  I believe I have developed a reputation for giving our referring physicians a straight answer about their patients.  We are not afraid to admit when we don’t know the source of a patient’s problem or to let the referring physician know when the patient is not a good candidate for physical therapy.

Any damage to your practice’s reputation is costly.  Irritating just one referral source who sends, say, 50 referrals a year at 10 visits per referral, could cost your practice 500 patient visits per year.  Multiply 500 by your average reimbursement per visit and you will see that you have lost enough to pay for most of one therapist’s salary.

In future articles in this series, Paul discusses how his organization’s philosophy, important management metrics, and schedule management all contribute to the low no show rate at OPTM.

Clinicient recently created an advisory group of senior clinical leaders that have graciously volunteered to give us feedback and advice on our product roadmap and industry trends.  I will be regularly blogging on what we are learning from the group in this space.

During a recent meeting, I asked this question: “What is the biggest challenge you face guiding your staff in creating concise, compliant, and relevant documentation?”  Here is what we learned from their responses:

• Importance of Standardization:  Scot Campbell at PT Northwest, made the point that trying to follow another staff member’s documentation of functional and clinical progress can be a challenge without having some documentation standards.  Brad Deal from Stewart Physical Therapy agrees that fostering consistency site to site, day to day across a multiple clinic organization is a challenge.  Sean Mckeown from PRN Physical Therapy noted that clinical reports are a product of the organization and reflect the quality of care of that organization.
• Concentrate on Function:  Paul Christensen at OPTM Physical Therapy Group has found that he needs to coach hist staff to quit concentrating on “what we are doing to the patient” and more on “what the patient needs”.  In other words, in his experience, therapists have a difficult time converting their thinking about impairments (strength, range of motion, etc) and translating that into thinking about function.  Darlene Pope of Sports, Spine and Industrial Physical Therapy and Matt Van Campen at PT Northwest both commented on the importance of supporting medical necessity by documenting functional limitations and goals.
• Beliefs Change Behavior:  John Woolf at Proactive PT pointed out that “eduction does not change behavior, beliefs change behavior”.  Utilization of an EMR has little to do with changing behavior.  As part of his mentoring to staff, he asks very specific questions about the therapist’s beliefs about documentation.

Give us your comments below, and tell us your challenges!

In a future blog, I will share what we learned from the group when I posed this question:

“What is the single most effective thing you have done as a leader in your organization to improve clinical staff productivity?”

Clinicient will be exhibiting in just a few weeks in Chicago at the APTA’s Combined Section Meeting. Come visit us at booth #670 and get your FREE tip sheet on the “The 7 Metrics You Should Know to Operate a Healthy Practice” – a summary of the critical metrics our most healthy practices use to help them predict cash flow, measure therapist productivity, spot potential issues before they become problems and help keep their practices profitable. We’ll also be happy to give you a quick demo of our fully integrated, web-based Physical Therapy software: PT EMR and PT Practice Management systems that your therapists will want to use, and that are proven to help improve your business performance.

Hope to see you there!

Is your practice healthy?  Now, more than ever, is the time to keep a close eye on your business and measure what matters. Healthy practices track critical business metrics, and use the right systems to help them effectively manage their practices. Coupled with the significant changes that lay ahead with ANSI-5010, ACOs, ICD-10, Medicare compliance – each of which can have a disruptive impact to your business – 2012 is the year to re-evaluate and make sure you are in a good position to weather the storms that lie ahead.

Having worked with so many Outpatient Rehabilitation practices over the years, as well as running our own Physical Therapy billing service, we’ve developed keen insight into what information is critical to track in order to predict cash flow, measure therapist productivity, spot potential issues before they become problems, and help keep your practice profitable. Find out what our most healthy customers measure by downloading our free tip sheet on the “7 Metrics You Should Know to Operate a Healthy Practice“. If your physical therapy EMR or Practice Management system can’t give you this information, 2012 is the time to upgrade. Contact us, and we’ll help you out!

I recently read an interesting article written by Ron Sterling at KevinMD.com called Why your EHR note may not be accurate.  He makes some interesting points, including:

• There are a variety of reporting and presentation options available from a visit note.  So, the accuracy of a report derived from the visit documentation depends on how much of the information from the visit is included in a particular report format.
• Some systems may add text to the document that was not contained in the record.  For example, a particular report may automatically include other information about the patient that was not included in the data for that particular visit.

Without going into the differences between an EHR and EMR, I believe that information in a well designed electronic system is more accurate and complete than records that are hand written or dictated and transcribed.

A typical workflow in many physical therapy clinics who do not use EMR looks like this:

• dictation and transcription of evaluations and progress evaluations
• hand written daily notes
• a flowsheet on a clipboard somewhere in the gym for recording exercises
• some sort of paper ”superbill” or manual method of reporting charges
• a computerized billing system

So, in many PT clinics, there may be as many as 5  separate, non-integrated records.  In addition, there is no systematic way of insuring that the clinical reporting meets minimum compliance standards or supports the insurance claim for a particular visit.  Often these non-integrated records do not stay in synch.  For example, the flowsheet, which is part of the clinical record, may not support billing for that date of service.

If the EMR system meets these criteria, your documentation will be more accurate, complete and compliant than it would be in a typical workflow:

• Allows your organization’s Clinical Content Library to be configured to meet the requirements of your clinical specialties and individual therapist needs
• Allows you to configure the information that is included (and not included) in various report formats
• Automatically tracks important findings for tracking of clinical and functional goals
• Aggregates procedure codes properly based on the clinical record
• Truly integrated so that billing and clinical information is in one common database.  This includes the flowsheet, daily notes, evaluations, progress evaluations, discharge evaluations and correspondence to physicians and patients.

The Clinicient Clinical Advisory Group is composed of seasoned clinical leaders who meet regularly to advise us on important trends in the industry.  In a recent meeting with the group, much of our discussion centered around the importance of documenting medical necessity with functional and clinical findings.

Everyone in the group agreed that including results from clinical tests and measurements (Range of Motion, Strength, Balance, etc.) in documentation is not enough to document medical necessity.  Here are some important take aways from the group:

• Document Current Functional Level:  Adequate documentation of medical necessity must include specific information on the patient’s current functional limitations.  Complete the sentence: “Patient has difficulty with… ” or “Patient is unable to …”
• Support Functional Deficits with Relevant Clinical Findings:  Answer ”the Why?”.   If the patient cannot climb stairs independently, is it because of limited and painful weight bearing knee excursion, strength, balance, or something else? What clinical findings are you using to gauge the patient’s progress toward a Functional Goal?
• Rationale for Treatment:  The treatment plan must illustrate the rationale for treatment.  It should be apparent to the person reading the report why certain procedures are being employed for the identified clinical and functional impairments.

I think most of us will agree that the above points make sense, but in my experience, clinicians have difficulty establishing functional goals that are supported by clinical goals and a rational treatment plan.  More information on this is included in this 4 minute video:  Physical Therapy Progress Reports Made Easy