Select the right metrics to improve your clinic’s billing performance

How often do you rely on your intuition when selecting a Key Performance Indicator (KPI) for your chiropractic clinic to track? Have you ever avoided hiring a person who did not “look the part?” When it comes to practice management and chiropractic billing, looks might have nothing to do with the statistics that reliably predict performance.

Most chiropractic clinic owners and office managers know that good management and performance improvement require measurement. “We can’t manage what we can’t measure” is a well-known adage. But measurement of one KPI does not always result in accomplishing your goals.

If you make such a mistake once, you experience disappointment. If you repeat it several times, you get frustrated. Repeat your frustration enough times, and you will grow anxious about making decisions in the future. Anxiety can create feelings of worry, uneasiness, and dread.  An indecisive chiropractic practice owner or practice manager is a poor manager.  A vicious cycle gets created causing you to fail as a practice owner or manager and experience frustration and anxiety about your personal performance.

A recent article in Harvard Business Review (M. Mauboussin, “The True Measures of Success,” October 2012, pp. 46-56) identified three cognitive biases that impede practice owner’s intuition and skew practice management decisions:

1. Overconfidence
2. Availability
3. Status quo

Overconfidence

Our deep confidence in our own judgement is often at odds with reality. For instance, most people regard themselves as better-than-average drivers. This tendency readily extends to practice management, where a chiropractic clinic owner relies exclusively on charges for a chiropractic billing success metric. While a downward trend of charges may be indicative of a problem with shrinking patient visits or a broken charge submission process to insurance companies, its growth does not necessarily result in total revenues growth.

Availability

We often overestimate the importance of examples that are easily available, that are at the top of our minds, for instance when they are frequently repeated or they are most recent. In the chiropractic billing industry, the three most recently unpaid claims by an insurance company do not necessarily indicate that this insurance company has changed its policy, or that the chiropractic biller in your office has grown negligent with her duties.

Status Quo

Chiropractic practice managers prefer staying the course rather than facing the risks associated with change. This bias is in part a result of risk avoidance, a fear of loss even in the face of a bigger gain. It makes it difficult for a chiropractic practice owner to adjust the KPIs in a changing environment, caused by new insurance payment policies or sweeping changes like Obamacare. It also makes it difficult for the practice owner to shift his focus from acquiring new patients to better serving the existing clients, once the practice has achieved a critical mass and is able to start growing based on patient referrals.

Which one of these do you think you could be guilty of? Please share your views and experiences in the comment box below.

What metrics and KPIs should you track in your practice?

Learn more about the metrics included in Genesis Chiropractic Software.