Many of our clients are seeking to improve the operational effectiveness of their employed provider networks. Some clients have experienced aggressive growth, which has outpaced their ability to develop the appropriate infrastructure. Others are attempting to curb mounting losses.

Addressing such issues requires performing a “check-up” of your network in the form of operational assessments. In December, we described our two phase approach that uses high-level benchmarking to identify potential problems, and then in-depth observation and analysis to explore and solve those problems.

This article offers a more in-depth discussion on some of the most common questions addressed during our operational assessment process.
As new practices come on board, is there a systemization and assimilation of policies and procedures?

Developing a standardized, best practice approach to the management of individual offices in the network will benefit the financial performance of the network’s practices as well as help develop a group culture across the network. During phase two of the assessment process, it may be necessary to observe patient flow patterns, staffing procedures, and check-in/check-out activities. This will identify any unwanted variation within these processes and allow for the creation of standardized procedures to increase efficiencies across all offices.

Are the staffing levels appropriate in your network?

Too much staff can exacerbate financial losses and create inefficiencies. That said, less is not always better. Often networks can grow beyond the ability of current staffing levels and are not managed effectively with the current compliment. Too often C-suite executives and upper level management become too focused on keeping staffing ratios low.  Left unchecked, this can be as, if not more, damaging to a growing practice than a little extra cost from overstaffing. Phase one of the assessment process should consider per provider and volume-based staffing ratios.

Mix of Services
Was there strategy involved in the growth and development of your network, or is it now a network made up of anyone who wanted to be employed?

The mix of primary care to specialty physicians should always be monitored in a network and the strategy behind that will be dictated by the overall strategic initiatives of the organization.  A strategic assessment should use population based models to determine whether the primary care base is sufficient to properly serve the community and feed the specialty providers. Additional considerations, like whether the organization has a specialty center of excellence will also influence the desired mix of services.

Aligned Compensation
Are provider payments aligned with current and future practice revenue streams?

High performing provider networks are made up of high performing physicians and advanced practitioners. It is therefore crucially important to ensure your compensation structures encourage and reward high performance in areas that impact the organization’s revenue. During phase one of the assessment process, benchmarking analysis should test the correlation between productivity and compensation. Additionally, the amount of compensation dedicated to quality measures should be studied and evaluated in the context of the organization’s transition to value-based revenue streams.

Neal D. Barker

Partner and Managing Director, Compensation and Compliance