Ask MGMA: How to Cut Costs and Improve Efficiency in Your Medical Practice
Download MP3Well, hi, everyone. I'm Daniel Williams, senior editor at MGMA and host of the MGMA Podcast Network. We're back for another ask MGMA podcast today. And as always, our senior adviser and cohost, Christy Goode, joins us. So, Christy, welcome.
Cristy Good:Thanks, Daniel. It's always great to be here and connect with our members on what really matters in their
Daniel Williams:It really is. Thank you so much. And today, because Christy has shared with me, everybody, she shared with me a really interesting topic that came in from some MGMA members. So today, we're digging into actionable strategies for reducing expenses and boosting operational efficiency in the medical practices. While, Christy, you and I were talking offline, I told you I was cutting some of my streaming services.
Daniel Williams:I was looking at ways to cut things, and you were telling me that, you have an awesome gym free gym membership because you work a few days a week. The gym Anything to cut cost right now. Right? That's our our mindset right now. Yeah.
Cristy Good:Yeah. I clip coupons every week too for King Soopers.
Daniel Williams:Me too. That's our local grocery store here in the Denver area, everybody. So let's get to it. One member had noted how surprising it was that the last MGMA thread on cutting practice expenses dated all the way back to 02/2009. Christy, why do you think this conversation is resurfacing now in such a big way?
Cristy Good:It actually was in our MGMA member community, and they were looking at an article from way back when, and they were asking what people have asking. Have they noticed changes? That kind of thing. And so it really jumped out to me, And I was like, that's a great question. And I think we've reached the point where rising labor costs, inflation and tech related expenses are just creating sustained pressure, especially on reimbursement rates that remain flat or decline.
Cristy Good:And while practices are focused on growth and staffing or even recovering from COVID disruptions, we need to really continue to focus on a long term strategy on how to do cost containment and make it a continuous process, not just yearly at budget time.
Daniel Williams:Alright. Thanks for that, Christie. Now the community member pointed out that both large and small organizations are struggling with the same core issues, limited administration support, and vendors holding firm during negotiations. Are you also seeing this across the board?
Cristy Good:Yes. Whether you're a nine site urgent care group or a major health system with 14,000 employees, really comes down to bandwidth. Admin teams are stretched thin, as we all know, and many don't have the capacity to analyze their spend at that really small granular level, or even to engage in a kind of strategic negotiation with their vendors. And vendors know this, right? They're like, people are busy.
Cristy Good:And I think they try to take advantage of that a little bit. So practices need both strategy and structure to really dig into what those expenses are and how they can make some difference in reducing those.
Daniel Williams:Perfect. Perfect. Okay. So let's keep taking a deep dive into things. I know you were talking about clipping coupons earlier.
Daniel Williams:Based on your conversations with MGMA members and the recent cost cutting guide, what categories of spend are actually moving the needle for practices this year?
Cristy Good:We've talked to many members, and a number have responded on the community as well. But there are some key areas. First is that cloud based tech and automation, Things like automated claim scrubbing, AI assisted coding, digital payment systems really help reduce manual errors and staffing costs. The second area is in scheduling optimization. Practices that use waitlist fills or double book high no show slots are reclaiming some of that revenue they used to lose, which is really a great idea.
Cristy Good:And then a third one is really strategic outsourcing. So things like credentialing, prior authorizations, and billing can save you costs and improve turnaround times if it's done with the right partner, and that's really the key. You have to make sure you know who what the terms are of that contract and hold them accountable too if they're not delivering.
Daniel Williams:Okay. We've been talking about cost cutting, but then there's also overspending. So my wife and I actually went to King Soopers, our grocery store, over the weekend. We got to the checkout line. We just had a small bag of groceries, and, we played the price is right game to see who could get the closest to it.
Daniel Williams:I was gonna be so far off that she went first, and I did the old strategy from the price is right. I just went under that several dollars, and she was so close, miraculously close to it, but she went over. So I I won. I won even though I had no idea what I was doing. But with that said, what are some where are some places then where practices might be overspending without even realizing it?
Cristy Good:That's such a great question. I actually recently just talked to a practice, and they're trying to figure out how to track their referrals because they come in from a fax machine. So I think looking at some of those overlooked areas such as copier or fax leases, software licenses and utilities is another that's an area to really look at. We also had another practice paying for two overlapping patient messaging platforms. And like I said, another one was leasing equipment that hadn't been used in months, even though they were using their fax machine.
Cristy Good:Others have had a fax machine sitting there for years, never using it. So just looking at some of those things. And then also like shredding services or storage fees. If you're still storing your records at one of those storage facilities and it's past the date that you need to, you really should look at that so you could help kinda cut those costs so you're not overspending on something you don't need to.
Daniel Williams:Alright. Next question then. You put this guide together. Tell us about it, what the origin of it was. What are some interesting things in the guide?
Daniel Williams:Then I wanna ask you a couple of pieces more detailed within the guide there.
Cristy Good:Okay. So I just put together a guide of what are some cost saving strategies, where to look, and where to reduce expense and boost your efficiency. And so I looked at the 2,009, what was written in that article, then compared it to what's going on today in the marketplace and seeing where the changes have been. So we will have that available just to give you some thoughts to where you might wanna strategically look at your practice. And where I suggest is really start with automation.
Cristy Good:For example, automating appointment reminders via text or email can drastically reduce no show rates and from desk workload. We know that patient that gets that reminder the night before, the morning of, are more likely gonna be oh, yeah. I have an appointment. I better figure that out and get in. Versus someone who has set up that appointment six months ago because it's our well checkup or a follow-up appointment.
Cristy Good:They get busy in their everyday life. So that's something simple to start with. And then from there, I would suggest you look at AI tools and billing and documentation. Many now integrate in EHRs and reduce both denials and staff time. If you want the outsourcing route, that is a bit of a bigger leap.
Cristy Good:But if credentialing or prior ops are slowing your team down, that's a great candidate to shift externally. The ROI for these cases is about freeing up internal resources to focus on patient care and revenue driving tasks.
Daniel Williams:So you mentioned the guide. Is it available now? I'm sorry. You are working on so many different projects, Christy, that I'm not sure which ones are in the pipeline or which ones are already out available to the public. So just bring us up to speed on this guide.
Cristy Good:Yeah. It's just a quick guide, little checklist, where to think about. And it's not out yet. Hopefully, it'll be uploaded this week, if not next week, on our website. But we can then attach it to this podcast as well.
Daniel Williams:That sounds great. Yeah. So that sounds good, everybody. We'll just we'll hold that because we will we'll make sure it is available for y'all when we publish this podcast. Whenever this hits, we'll have that direct link for you in the episode show notes.
Daniel Williams:One thing that I've had a lot of conversations with p people recently, Christy, maybe you have too, but what role can cross training staff or even rethinking your scheduling approach play in reducing cost?
Cristy Good:Definitely, that's a huge one. Cross training builds flexibility and allows your team to pivot when someone's out or during slow periods. For instance For instance, like a front desk staff could learn basic billing workflows or clinical staff can help with outbound patient calls. And I think it also gives your staff just that career growth, maybe some of that change or variety in their job that many are probably looking for. And then scheduling is another area with room for innovation.
Cristy Good:So things like group visits for chronic care or adding Saturday hours to capture patients who can't come in during the week can lead to more efficient throughput and patient satisfaction. And I know that many have gone to maybe a half Saturday morning, and some of those staff actually like having a day after in the week when it's less busy to do their errands or maybe to go skiing or maybe to go do something fun where it's more busy on the weekend, and then they actually like coming in to work on a Saturday. So it is an option, and just talk to your staff and involve your staff in those conversations.
Daniel Williams:Group purchasing organizations, they're mentioned in the cost saving guide as well. So can you please explain how practices can make use of them and whether they're worth it?
Cristy Good:Sure. It's definitely worth it for a small practice and mid sized practices that don't have that same buying power as a hospital system. GPOs aggregate demand and negotiate lower prices for things like medical group supplies, equipments, even vaccines. The key is you need to do your homework, though. You need to make sure that the GPO you join has pricing arrangements or agreements with the vendors that you already use.
Cristy Good:And then check that their contract terms are favorable. It's not always a one size fits all, so you wanna make sure that the savings could be substantial. MGMA has an opportunity for practices to participate in something called what they call as MGMA Best Price, which offers some of that group price purchasing discounts.
Daniel Williams:Thanks for that. Last question then. We talked a lot about cutting costs, about watching for overspend. Could be a bit overwhelming. A lot of information here.
Daniel Williams:So for a practice leader who knows they need to tackle vendor spend but does feel that overwhelm, where's a starting point? What are some first steps to take?
Cristy Good:My personal suggestion would be to start with, one area. It could be technology subscriptions or maybe medical supplies. Do a ninety day look back and ask, are we still using this? Are there redundancies? Can we renegotiate?
Cristy Good:Involve your team, your front office, your clinical, even your IT, because they often have great insights and ideas as to what they see, and then engaging them creates buy in. So you don't have to overhaul everything overnight. Just start small and be consistent. And the key is cost containment. Right?
Cristy Good:And you make it part of your culture, then it continues to be done instead of just once a year during budget season.
Daniel Williams:Perfect. Alright. Christie, thanks again for walking us through these real world strategies. These are exactly the kinds of conversations our members are having every day. They're reaching out to you.
Daniel Williams:So remind our listeners, how do they find Christie Good on-site?
Cristy Good:There's a couple different ways. One is that little green button on our MGMA website that says ask MGMA. Another one is just emailing adviser@MGMA.com, and either way, it will get you to us. And then again, this whole conversation started on the MGMA community where colleagues are talking to each other. So that's a great place also to just put your question out there to see what others are doing.
Daniel Williams:Perfect. Alright. So thanks everybody for being a listener to the MGMA podcast. As Christie said, just go out there to that green button, ask MGMA, and ask a question there, or ask those questions, as she said, in the member community as some of our members did right here. Until next time, stay well and keep on asking questions.
Daniel Williams:Thank you so much.
Cristy Good:Thank you.
