By Nicki Hemminger
With small businesses across the country closing their doors because of the COVID-19 pandemic, restaurants, bars, breweries, and music venues are taking a financial hit that many may not recover from.
However, something that receives far less attention in the media – and is a much bigger hazard to the nation’s health – is the threat this crisis poses to primary care physician and other provider offices, many of whom are not seeing patients at all in the absence of elective surgeries and routine care appointments.
As a result, provider offices are seeing a major decline in revenue across the board, and many are closing their doors, possibly forever. By the end of June, more than 58,000 family physician offices may close, representing a significant drop of 42% since the end of March, according to HealthLandscape, a division of the American Academy of Family Physicians (AAFP).
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Reasons for the potential office closures range from loss of revenue, drastic reductions in staff and hours, and the reassignment of physicians to hospitals so they can deliver COVID-19-related care, according to AAFP. Such a reduction in physician offices would be associated with the loss of nearly 800,000 jobs.
While these projections may represent a worst-case scenario, they are nonetheless troubling. Already, we are seeing reports of significant layoffs among healthcare workers – who represent only a small portion of the surge in unemployment the country has undergone in recent weeks, with 22 million people filing for unemployment in just a month, nearly wiping out all job gains since the Great Recession. As more Americans lose their employer-sponsored health insurance along with their jobs, demand for medical services is likely to decline.
Faced with such substantial headwinds, if provider offices hope to survive, many will likely need to look to their own financial health and re-evaluate ways of doing business. But it can be done. Following are three tips for provider offices to improve their own financial health during the pandemic.
Start with the Revenue Cycle Management (RCM) basics:
With so many practices enduring such severe reductions to their average number of transactions, now is the time to make sure practices are efficiently handling the basics of revenue cycle management (RCM). These basics include properly checking patient eligibility and benefits, working on claim errors upfront and sending clean claims to payers in a timely manner (typically within three weeks from the time services are rendered) and promptly working to resolve denials.