Oates and Company Blog

Competition is useful because it can encourage practitioners to push past their perceived limits and reach higher levels of achievement. Over time, sustained competition will make practitioners better at providing medical services; the desire to succeed will encourage them to work on new skills and gain new qualifications. 

Internal competition, however, can be a double-edged sword. Even though encouraging competition is simple, encouraging the right kind of competition is not. Some forms of competition can strengthen multi-physician practices, but others can cause stress and strife among fellow physicians. Uncorrected, these forms of competition can lead to physician burn-out, which, if not addressed, will lead to serious problems with their performance.

To combat these potential problems, managers of multi-physician practices must learn to use the right methods of encouragement. For example, the threat or use of punishment can be used to encourage competition, but it’s an ineffective way to do so – punishment is counter-productive because of its negative impact on morale. Managers should instead use rewards because it positively impacts performance and, mostly importantly, a physician’s belief that he/she can try new things without fear of recrimination.

Rewards need not be expensive. In fact, one of the most popular rewards is verbal praise, particularly in front of others. Managers of multi-physician practices must make sure, of course, that their verbal praise toward one physician doesn’t also serve to belittle another physician – the goal is to encourage cooperative competition between their physicians rather than causing them to dislike and distrust one another. Certain rewards, like financial compensation, are almost guaranteed to inspire hostile interactions between participants. On the other hand, if a manager chooses to offer a financial bonus to all participants who exceed a certain level of achievement, a competitive spirit can be encouraged without sacrificing the cooperation that is essential to multi-physician practices.

The reward structure should be made clear to the all participants at the multi-physician practice. Physicians should understand both the nature of the reward and how to receive the reward. Furthermore, physicians should receive regular updates on their progress toward the goals. However, too much emphasis on the rewards can cause physicians to become stressed out, meaning that it is best for managers to keep the competition as light-hearted as possible.

Your fixed assets – machinery, chairs, computers, software, and even buildings and land – are things you use every day and barely notice, but without which your business couldn’t operate. They are investments in your vision, in your people, and in your bottom line. That investment costs money and maximizing return on that investment is just as important as producing a good product.

How do you maximize a return on fixed assets? You already know that fixed assets have a life cycle, especially in the tax world. Managing that life cycle is integral to keeping your assets paying you instead of repeatedly paying for them. 

Revenue sharing in a multi-physician practice is often done on a production based system. Production based pay gives the harder working physicians a larger slice of the earnings. Revenue allocation is also sometimes done based on a percentage of the revenue regardless of an individual's production. Both of these methods have pros and cons.

If the group is a single specialty group, both systems can often be used – a flat, smaller percentage divided equally and another portion based on production. This can depend on the type of specialty; if two doctors share the same specialty, equal payment can encourage them to back each other up; if one doctor is out sick or on vacation, the other doctor willingly steps up to help cover the workload.

In practices with multiples specialties, production based revenue allocation is an often used method. A large number of groups use receipts to measure productivity, where the direct costs are subtracted from the revenue and overhead costs are assigned. This system may seem fair but in areas of the country where most patients have low billable amounts, some physicians will be at  a disadvantage. This will require the group to find a way to balance the mix.

How expenses of the practice itself are divided among the group can have a huge effect on income distributions. If expenses are to be divided evenly, it would be best if all the doctors’ revenue is somewhat equal. The other option is to charge all expenses that can be tracked to the doctor who uses them. This, however, could cause physicians to start taking shortcuts to save money and could affect the quality of care given to patients.

Regardless of how the revenue allocation is decided, an accurate and understandable system must be in place. All members of the group need to feel that they are getting a fair share and no one should feel as if they are carrying the bulk of the load.

Cost allocation is the method of identifying and assigning costs to the site at which they are incurred. Each branch/location of a medical practice is considered a ‘cost center’ and multi-site medical practices can have varying costs based on the location and services offered at a particular site. For example, sites that house administration will have lower costs than sites that house laboratories or operating rooms. Cost allocation is very beneficial in the management of a multi-site medical practice.

There are several good reasons that allocating costs is important to a multi-site medical practice. When costs are assigned correctly, the types of costs at each location can easily be analyzed, which is very important in the budgeting process. With a budget that is based on accurate cost allocation it is possible not only to see expense overages quickly, but also to correct expense overages quickly. Keeping track of expenses is essential for internal planning. 

Fixed asset accounting deals with recording, tracking, and disposing of fixed assets such as buildings, real estate, vehicles, and equipment that represent the ‘big-ticket” items bought or acquired by an enterprise. In a very large company, a dedicated fixed asset accountant is on staff, while in smaller companies, the regular accountants/bookkeepers might have the fixed asset responsibilities incorporated into their job description.

Fixed Asset Responsibilities

With the passage of the Marketplace Fairness Act, fears about compliance are running rampant through businesses subject to the new internet sales tax regulations. While this fear is understandable, it can be mitigated by the simple use of modern technology.

Raleigh, North Carolina is a bustling town full of growing businesses, many with multiple locations in and around the city. That means, of course, that there are multiple things to manage as well – multiple sites, multiple buildings, multiples employees, etc. All of these aspects need to be kept in sync and up to date so that a business can reach its maximum potential.

Emails can work for this purpose, but they don't always reach their intended audience. Employees usually have a long list of unopened emails; the chances of another being lost in the shuffle are very high. Inter-office memos can pose the same issue, and phone calls are highly impractical. What businesses need is a streamlined method of communicating – keeping employees, departments, sites, and buildings in the loop.

Many companies are turning to a cloud based system to achieve this end. A cloud based system allows any employee within a company to input data into a company computer. Then, not only is the data automatically available to every person in the company, it’s also organized and much easier to find than conventional emails or printed memos.

A cloud based system is easy to use but does take time to learn. If you’re a business in Raleigh, NC, however, you have an advantage: Oates & Company. We offer a number of different systems to fit each unique business need around Raleigh – including yours. We will come to you and assess your needs, have a discussion about the possibilities, and together we can find an appropriate communication system and train the appropriate people.

Every business should discover what they've been missing around Raleigh with a cloud based communications system – contact Oates & Company to get started.

The Sage Group develops and markets Sage ERP X3 from its headquarters in England; it has other ERP systems, but Sage ERP X3 is their most powerful, flexible, and cost-effective software: it supports industry-specific processes and provides end-to-end visibility within one compact software design. It is fast to deploy and simple to manage, it enables employees, partners, suppliers, and customers to access information conveniently, and it accelerates business exchanges.

When the recession hit the United States in 2007, physicians and their practices were not spared. Numerous studies found that patient visits decreased because people lost insurance coverage and put off routine – and sometimes not-so-routine – visits. At the same time, overhead costs increased, leading to a fair amount of anxiety and frustration for physicians who were watching their profits start to dwindle.

Every medical practice has its own method of keeping records. Currently, the majority of practices are keeping their medical and business data separate – despite the fact that maintaining two different systems for record keeping is costly, time consuming, and far less effective.