How confident are you that the financial systems in your practice are running as they should be? Do you even know what to look for?
As a business owner and practitioner, orthodontists spend years expanding their education, building their business, and shaping their teams. That said, most would agree that their true expertise lies in doing what they do best...providing life-changing results for their patients by creating healthy and beautiful smiles.
While wearing so many hats, finding the time to ensure that the practice's financial management processes are being managed perfectly and efficiently can seem daunting. As a consultant, I have seen this scenario (and the implications) play out time and again.
As a practice management company, we consider a regular third party audit of your financial systems and protocols to be a business best practice. Let’s consider what can be gained by evaluating this area of your practice:
1.) Gain New Perspective: A third party assessment and evaluation provides an unbiased appraisal of the key areas of your practice’s financial management processes and identifies areas that are, and are not, being managed effectively. Examples include delinquency follow up protocol, credits both on patient and insurance accounts, and proper ratios of paid-in-full vs. payment plans. It’s often difficult to provide objectivity if you are self-auditing – there is simply so much “you don’t know what you don’t know.” What are the red flags, patterns and process gaps? What is working well, what are we not doing?
2.) Verification That Insurance Guidelines Are Being Met: Adhering to insurance guidelines is essential when filing insurance claims. A review of insurance processes helps ensure that the necessary guidelines set forth by the insurance companies is being followed regarding claim content and submission.
3.) Gain a Better Understanding of the Adjustment Process: It is quite common to find adjustments that are not being applied properly within a practice. Often, this is due to the financial coordinator not having had the necessary training to provide a better understanding of financial adjustments, their purpose, and how they affect the accounts receivable regarding production and collections. The audit process will help identify the proper/improper use of adjustments within your practice’s accounts.
4.) Peace of Mind: Knowing this high-risk area of your practice is on solid footing allows you to rest easier and move your attention to other things. The output of an audit should come with a detailed written report summarizing all findings, a clear outline for needed course corrections and a recommended action plan from the provider. A phone consultation is recommended to allow the provider to review findings, to ensure the client understands, and to allow you, the practitioner, to ask questions.
Technology provides us with remote capability and flexibility that we just didn’t have before. Most audits can be performed via remote access, which is more efficient for you and the auditor. Results can be provided in a much timelier manner than if the audit was to be performed on-site. Often, the audit can even be performed during evening hours with no loss of patient time.
A one-time external systems audit is a great first step but may not enough. We recommend at least an annual audit, perhaps more if systems require significant attention. It is fairly common, even in the best practices, to see cyclical lags in the upkeep up financial systems. We get busy, there may be staff transition or shared roles, or even a software glitch from an version upgrade. The cost of an audit is minimal, and always pays for itself.
If you have any questions about the financial audit process or other financial systems questions, please contact me at email@example.com
All the best,
Meet the Author
Susan Klembeck is a Financial Systems consultant for Hummingbird Associates. She has been working with orthodontic practices for over 20 years to train and implement best practice financial protocols on Dolphin and Orthotrac.