PRACTICE MANAGEMENT RESOURCE GROUP

Consulting Case Study 1: Six Physician Orthopedic Practice

PMRG was called in to advise this practice because the physician-owners could not pay themselves their usual $25,000 - $50,000 bonus at the end of the year. These orthopedic surgeons paid themselves a rather modest salary for a practice of their specialty, and would bonus themselves at the end of the year from the surplus funds in the practice's accounts. PMRG assessed the practice and found the following:

Value of services provided in year assessed (at the practice's fee schedule)	$9,200,000
Actual charges	$7,400,000
Collection target (calculated at 64% of charges)	$4,736,000
Actual collections (48% of charges)	$3,552,000
Lost income from under-priced services	$ 325,000
Lost income from uncharged services (64% of $1,800,000)	$1,152,000
Lost income from poor collection performance (16% of $7,400,000)	$1,184,000
Total lost income	$2,661,000

These physicians were concerned because they were unable to pay $300,000 in bonuses, when they should have been able to distribute $2,600,000 in additional profit.

Consulting Case Study 1 | Consulting Case Study 2 | Consulting Case Study 3 | BILLING CASE STUDIES