Annual Data Review
Looking Forward by Looking Back

by AJ Riviezzo
With the end of the year, it is a great time to assess how you have been performing and to establish some performance goals. This first section is one quick way to assess how you have been performing.

First, create a simple spreadsheet that details (for medical services) the billed charges, the collected dollars, and the number of ablations performed month-by-month. Complete this for the past three years (2007, 2008 and 2009).

The format would look something like:
Month: January, 2008 January, 2009
Billed Chrgs $500,000 $600,000
Collected $’s $165,000 $205,000
# of Ablat.’s 50 61
Month: February, 2008 February, 2009
etc., etc.

Total each category (billed charges, collected dollars, and ablations) for each year. Now you have some data with which you can work.

Second, let’s analyze your data. The first step is to simply compare the three years in general. Are the numbers going up or going down. Can you identify some seasonality in your numbers or is the seasonality a known issue since you take half of December and half of July as vacation?

Next, divide the total collected dollars into the total billed charges. Unless you have changed your billed amount, this should give you a ratio that remains relatively consistent. If it is not consistent, this may indicate a problem with your collections or a major change in your payer mix. Either way, it should be investigated.

Now divide the total number of ablations into the collected dollars for the year. This will generate your average income per ablation. This dollar figure can be used in two different ways. The simple review is to see if your average income per ablation, from year to year, is trending up or down (typically slightly down due to payment changes from Medicare). The more interesting review is to compare the dollar number derived against your average Medicare allowable amount.

For example, if your average total income per ablation is $2,000 and Medicare allows $1,600, this indicates you are only generating an additional $400 in all other services pre and post ablation. This additional revenue margin may be low if you perform a large number of ablations on non-saphenous veins.

If you are primarily only performing ablations on the greater and lesser saphenous, it is an indication that either additional medically necessary services may not have been performed (such as closing of perforators using US guided sclerotherapy or stab phlebectomies) or that the aftercare plan is not being sufficient followed by the majority of your patients.

Please note that I am not advocating performing unnecessary services. Simply that you may need to review what services are being performed, and in what time frames, on an average case.