As your clinic grows, everything becomes more complex. More patients come in, more employees are hired, and processes that seemed to happen automatically in the beginning, don’t seem to be happening at all anymore. It doesn’t take long for things to fall off your radar.
Know Your Numbers.
Overhead in a typical chiropractic practice averages 50%. To calculate your average cost of providing an office visit and the percentage of overhead, do the following:
- List your monthly fixed expenses (rent, business loan payments, equipment leases, etc.) and a 12-month average of variable and non-monthly expenses (utilities, payroll, taxes, etc.)
- Determine your average number of offices visits per month for the past 12 months.
- Determine your average ACTUAL reimbursement per visit (Total income divided by total visits for the year)
- Divide the average overhead expense by the average number of office visits. This is your Average Cost per Visit.
- Divide the Average Cost per Visit by the Average Income per Visit to determine your Average Overhead Percentage.
- Click here for access to a simple spreadsheet that will allow you to identify your cost of providing an adjustment and a ballpark idea of your percentage of overhead. This chart is interactive to allow you to modify the numbers and determine “what if” scenarios for your practice.
Review Your Contracts.
Are you signing contracts for LESS than what it costs to deliver care? You must read your provider’s agreement and understand every stipulation that you are agreeing to with your signature. Far too often, doctors find out well after the fact that a procedure regularly performed in the practice isn’t covered or bundled under the terms of the contract. Additionally, providers may choose to add a new service or product—such as spinal pelvic stabilizers—and find that their provider agreement allows for reimbursement in the fee schedule at a level lower than the cost of the product or service.
Evaluate Your Fees.
At least annually, you should evaluate your actual fees to determine if they are in line with market values in your area. There are several websites (such as chirocode.com and fairhealth.org) that provide fee calculators to give you an idea of “usual, customary and reasonable” (UCR) charges are by CPT code and zip code. Pulling published fee schedules (like workers’ comp) also lets you know if you are billing above or below UCR for your area. Your fees should not be so far below that you are undervaluing the services you provide and leaving revenue on the table.
If you determine that your fees need to be adjusted, then take the time now to make those changes. If it has been several years and your fees need a major overhaul, consider using a consultant to help you bring your fees in line. Whatever route you take, make the commitment to see these changes through. Maintaining fees from rates you charged in the last century is not an option when you know your costs have increased over the years.
Don’t forget to review your ChiroHealthUSA fees to ensure that the discounts are reflective of your new fee schedule. If you need to make changes to your CHUSA fee schedule:
- Click here to download the fee schedule change form.
- Fax or email the change form with a print out of your UCR fee schedule from your software to (888) 685-2220 or email@example.com. Please put “Fee Schedule Change Request” in the subject line.
Many clinics are updating their fees at the end of the year so contact us soon to make any changes. If you have any questions about updating your fees, call (888) 719-9990.