(HealthDay News) – Constructing a budget for 2014 is critical for physicians even with the uncertainties surrounding the Affordable Care Act, according to an article published Nov. 10 in Medical Economics.
Jill Franks, CPA, a principal in Rehmann’s Healthcare Advisors Group in Saginaw, MI, explains how physicians can still create a practical budget for 2014, despite the economic uncertainties of health care reform.
Franks says that there are five basic steps to preparing a budget. They include analyzing revenue activity by reviewing one’s most commonly billed codes; identifying payers and assessing payer mix and reimbursement rates; reviewing payer contracts to ensure reimbursements match contractual adjustments per contract terms; examining the office schedule, including booking, wait times, and length of appointments; and making necessary adjustments to the fee schedule.
“While many think that preparing a budget means copying last year’s numbers, increasing revenue by 5% and decreasing expenses by 10%, the reality should be much different,” Franks writes. “And so will the results.”