Woodbury, NY (PRWEB) December 28, 2013
Leading health care and business valuation firm Gettry Marcus CPA, P.C., discusses the benefits of using benchmarking as a tool to compare against peers in the health care industry.
“Benchmarking is a very valuable tool, whereby a practice can compare its statistics, numbers and percentages against those of its peer group, which will highlight areas where they might be able to improve their business,” says Stuart Kertzner, Partner-in-Charge of the Gettry Marcus, CPA, P.C. Health Care Group.
Benchmarking a practice against other practices, sometimes referred to as "managing by evidence," consists of giving scores to the various aspects of a practice and then comparing those scores to the market leaders. Benchmarking, when used in conjunction with more commonly used financial data, such as financial statements and billing, collections and productivity reports, can shed light on areas in a practice that may need improvement. Once specific areas are identified, a more focused effort can be made to implement changes that typically result in increased profitability for a practice.
While obtaining comparable data through organizations such as the MGMA (Medical Group Management Association) and the AMGA (American Medical Group Association) is relatively easy, it is how the data is used that will ultimately determine if the benchmarking efforts are successful. Comparing a practice to others that are in the same specialty, of similar size and in the same geographic region can provide valuable insight as to what areas may be underperforming.
Some metrics that are commonly benchmarked are charges and revenues, days in accounts receivable, collection percentages, pay or mix, staffing, RVUs (relative value units), provider costs and operating costs. These metrics can be expressed in a number of ways, such as percentage of revenue, per FTE (full time equivalent) provider, per square foot, per RVU quantity or per patient. When the benchmarking data is compared with market leaders in a simple table, it is easy to analyze the results.
While benchmarking is certainly not the only way to improve a practice's profitability, using benchmarking along with other financial data does provide a fast and relatively inexpensive way to identify problem areas that may otherwise go undetected. It gives the practice a better idea of its position within a group of its peers and, more importantly, provides the practice with a valuable tool to help ongoing efforts for continued practice improvement.
Gettry Marcus CPA, P.C. is a Top 200 firm nationally with offices in Woodbury, Long Island and New York City. We provide accounting, tax, and consulting services to commercial businesses, high net worth individuals and various industries which include Real Estate and Health Care. We have one of the premier and most credentialed Business Valuation, Litigation and Forensic Accounting Groups in the New York Area. Our experience in diverse industries and a highly talented and experienced professional staff gives us the ability to share valuable insights into our clients’ businesses, to better understand their goals and problems and to help them attain the vision they have for their company.
Gettry Marcus is "Always Looking Deeper" to build value for our clients.
Media inquiries: Contact Fayellen Dietchweiler at 516-364-3390 ext. 225 or via email at fdietchweiler(at)gettrymarcus(dot)com.