Joseph S. Eastern, MD

Pop quiz: How long have I been writing that private medical practices are businesses, whether we like it or not; and like any other business, they require consistent, sensible business management?

If you answered that I’ve been harping on that point from the very beginning, congratulations; you’re a long-time reader. And yet, the most basic and important business tool – preparation of an annual budget – continues to be ignored by most private practitioners.

The usual excuse is lack of time, and besides, the practice seems to be doing fine without one; but like anything else, you can’t fix problems you never look for.

You can’t identify needless, wasteful, or redundant purchases, under- or overstaffing, or misappropriated funds if you don’t track your practice’s expenditure data.

There is no way to make intelligent decisions on such basic issues as fee adjustments, new equipment purchases, and marketing strategies without a firm grasp of your expenditures, and a reasonable idea of where those numbers may be going in the foreseeable future. Without a budget you cannot know your costs of doing business, let alone whether they are too high or too low. Chances are excellent that you are overpaying your taxes, too.

Embezzlers typically continue their nefarious ways far longer than they should (and some are never caught at all) because all too often, nobody is watching the budget numbers. And if you are planning a refurbishment or expansion, no self-respecting bank will approve a loan in the post-TARP era without seeing a well-organized budget.

There is no need to wait to take action until, one day, your cash flow is too low to meet payroll, or a similar crisis convinces you that budgeting is important. Now, at the beginning of a new year, with last year’s financial data accumulated and readily at hand – and before significant changes mandated by the recent health care reform legislation take effect (more about that next month) – is an ideal time to get a budget in place.

If your practice is incorporated and your fiscal year does not begin on Jan. 1, don’t use that as an excuse; draw up a limited, "partial" budget for the remainder of this year, then start a new one when your next fiscal period begins.

Creating a budget is not the formidable or expensive task you may be envisioning. Unless your practice situation is unusually complex, you can probably do it yourself – although, if this is your first time, you will probably want to enlist the help of your accountant. A good spreadsheet program like Excel or iWork simplifies the process considerably, and financial software packages like QuickBooks or NetSuite make it even easier. (As always, I have no financial interest in any company or product mentioned in this column.)

Start by creating a list of practice expense categories, or "chart of accounts" (COA) in financial lingo. Each component of a COA is called a "line item," and in general, the more line items, the better. Commercial software products typically provide a standardized COA, but you will want to customize it to your individual needs. (Your accountant can help with that.) This is a critical step, so take your time, and do it right. The more detailed you make your COA, the more flexible your budget will be, the easier it will be to identify deductible expenses at year’s end, and the harder you will make it for an embezzler to operate unnoticed.

Then, using last year’s records (or if possible, an average of several years’), assign a dollar amount to each line item. Right away, some rude surprises may be in store ("We spend how much on printer ink?"), but already you are gaining valuable information that can be acted on immediately.

If you are not sure whether you are over- or underspending on a specific line item, or the category is a new one and you don’t know how much to allot, check with local colleagues or your accountant. Some practice management firms post lists of "benchmarks" averaged from surveys of their clients. Benchmark numbers can be deceptive, however, especially if the surveyed practices are in different parts of the country or have different socioeconomic populations.

Creating a budget is only the beginning; periodically, you must compare your actual expenditures with those you budgeted. (Most businesses do this quarterly; more frequent reviews can trigger needless worry over normal short-term fluctuations.)

Look for significant discrepancies and the reasons for them. Are your expenditures excessive, or was the budgeted amount unrealistic? Adjustments (of both expenditures and budget) will be frequent at first; but as time passes and your financial management skills improve, your practice will sail along on a progressively smoother financial course.

This column originally appeared in the publication Skin and Allergy News, a publication owned by Elsevier. Dr. Eastern practices dermatology and dermatologic surgery in Belleville, N.J. To respond to this column, e-mail Dr. Eastern.

Pop quiz: How long have I been writing that private medical practices are businesses, whether we like it or not; and like any other business, they require consistent, sensible business management?

If you answered that I’ve been harping on that point from the very beginning, congratulations; you’re a long-time reader. And yet, the most basic and important business tool – preparation of an annual budget – continues to be ignored by most private practitioners.

The usual excuse is lack of time, and besides, the practice seems to be doing fine without one; but like anything else, you can’t fix problems you never look for.

You can’t identify needless, wasteful, or redundant purchases, under- or overstaffing, or misappropriated funds if you don’t track your practice’s expenditure data.

There is no way to make intelligent decisions on such basic issues as fee adjustments, new equipment purchases, and marketing strategies without a firm grasp of your expenditures, and a reasonable idea of where those numbers may be going in the foreseeable future. Without a budget you cannot know your costs of doing business, let alone whether they are too high or too low. Chances are excellent that you are overpaying your taxes, too.

Embezzlers typically continue their nefarious ways far longer than they should (and some are never caught at all) because all too often, nobody is watching the budget numbers. And if you are planning a refurbishment or expansion, no self-respecting bank will approve a loan in the post-TARP era without seeing a well-organized budget.

There is no need to wait to take action until, one day, your cash flow is too low to meet payroll, or a similar crisis convinces you that budgeting is important. Now, at the beginning of a new year, with last year’s financial data accumulated and readily at hand – and before significant changes mandated by the recent health care reform legislation take effect (more about that next month) – is an ideal time to get a budget in place.

If your practice is incorporated and your fiscal year does not begin on Jan. 1, don’t use that as an excuse; draw up a limited, "partial" budget for the remainder of this year, then start a new one when your next fiscal period begins.

Creating a budget is not the formidable or expensive task you may be envisioning. Unless your practice situation is unusually complex, you can probably do it yourself – although, if this is your first time, you will probably want to enlist the help of your accountant. A good spreadsheet program like Excel or iWork simplifies the process considerably, and financial software packages like QuickBooks or NetSuite make it even easier. (As always, I have no financial interest in any company or product mentioned in this column.)

Start by creating a list of practice expense categories, or "chart of accounts" (COA) in financial lingo. Each component of a COA is called a "line item," and in general, the more line items, the better. Commercial software products typically provide a standardized COA, but you will want to customize it to your individual needs. (Your accountant can help with that.) This is a critical step, so take your time, and do it right. The more detailed you make your COA, the more flexible your budget will be, the easier it will be to identify deductible expenses at year’s end, and the harder you will make it for an embezzler to operate unnoticed.

Then, using last year’s records (or if possible, an average of several years’), assign a dollar amount to each line item. Right away, some rude surprises may be in store ("We spend how much on printer ink?"), but already you are gaining valuable information that can be acted on immediately.

If you are not sure whether you are over- or underspending on a specific line item, or the category is a new one and you don’t know how much to allot, check with local colleagues or your accountant. Some practice management firms post lists of "benchmarks" averaged from surveys of their clients. Benchmark numbers can be deceptive, however, especially if the surveyed practices are in different parts of the country or have different socioeconomic populations.

Creating a budget is only the beginning; periodically, you must compare your actual expenditures with those you budgeted. (Most businesses do this quarterly; more frequent reviews can trigger needless worry over normal short-term fluctuations.)

Look for significant discrepancies and the reasons for them. Are your expenditures excessive, or was the budgeted amount unrealistic? Adjustments (of both expenditures and budget) will be frequent at first; but as time passes and your financial management skills improve, your practice will sail along on a progressively smoother financial course.

This column originally appeared in the publication Skin and Allergy News, a publication owned by Elsevier. Dr. Eastern practices dermatology and dermatologic surgery in Belleville, N.J. To respond to this column, e-mail Dr. Eastern.

Pop quiz: How long have I been writing that private medical practices are businesses, whether we like it or not; and like any other business, they require consistent, sensible business management?

If you answered that I’ve been harping on that point from the very beginning, congratulations; you’re a long-time reader. And yet, the most basic and important business tool – preparation of an annual budget – continues to be ignored by most private practitioners.

The usual excuse is lack of time, and besides, the practice seems to be doing fine without one; but like anything else, you can’t fix problems you never look for.

You can’t identify needless, wasteful, or redundant purchases, under- or overstaffing, or misappropriated funds if you don’t track your practice’s expenditure data.

There is no way to make intelligent decisions on such basic issues as fee adjustments, new equipment purchases, and marketing strategies without a firm grasp of your expenditures, and a reasonable idea of where those numbers may be going in the foreseeable future. Without a budget you cannot know your costs of doing business, let alone whether they are too high or too low. Chances are excellent that you are overpaying your taxes, too.

Embezzlers typically continue their nefarious ways far longer than they should (and some are never caught at all) because all too often, nobody is watching the budget numbers. And if you are planning a refurbishment or expansion, no self-respecting bank will approve a loan in the post-TARP era without seeing a well-organized budget.

There is no need to wait to take action until, one day, your cash flow is too low to meet payroll, or a similar crisis convinces you that budgeting is important. Now, at the beginning of a new year, with last year’s financial data accumulated and readily at hand – and before significant changes mandated by the recent health care reform legislation take effect (more about that next month) – is an ideal time to get a budget in place.

If your practice is incorporated and your fiscal year does not begin on Jan. 1, don’t use that as an excuse; draw up a limited, "partial" budget for the remainder of this year, then start a new one when your next fiscal period begins.

Creating a budget is not the formidable or expensive task you may be envisioning. Unless your practice situation is unusually complex, you can probably do it yourself – although, if this is your first time, you will probably want to enlist the help of your accountant. A good spreadsheet program like Excel or iWork simplifies the process considerably, and financial software packages like QuickBooks or NetSuite make it even easier. (As always, I have no financial interest in any company or product mentioned in this column.)

Start by creating a list of practice expense categories, or "chart of accounts" (COA) in financial lingo. Each component of a COA is called a "line item," and in general, the more line items, the better. Commercial software products typically provide a standardized COA, but you will want to customize it to your individual needs. (Your accountant can help with that.) This is a critical step, so take your time, and do it right. The more detailed you make your COA, the more flexible your budget will be, the easier it will be to identify deductible expenses at year’s end, and the harder you will make it for an embezzler to operate unnoticed.

Then, using last year’s records (or if possible, an average of several years’), assign a dollar amount to each line item. Right away, some rude surprises may be in store ("We spend how much on printer ink?"), but already you are gaining valuable information that can be acted on immediately.

If you are not sure whether you are over- or underspending on a specific line item, or the category is a new one and you don’t know how much to allot, check with local colleagues or your accountant. Some practice management firms post lists of "benchmarks" averaged from surveys of their clients. Benchmark numbers can be deceptive, however, especially if the surveyed practices are in different parts of the country or have different socioeconomic populations.

Creating a budget is only the beginning; periodically, you must compare your actual expenditures with those you budgeted. (Most businesses do this quarterly; more frequent reviews can trigger needless worry over normal short-term fluctuations.)

Look for significant discrepancies and the reasons for them. Are your expenditures excessive, or was the budgeted amount unrealistic? Adjustments (of both expenditures and budget) will be frequent at first; but as time passes and your financial management skills improve, your practice will sail along on a progressively smoother financial course.

This column originally appeared in the publication Skin and Allergy News, a publication owned by Elsevier. Dr. Eastern practices dermatology and dermatologic surgery in Belleville, N.J. To respond to this column, e-mail Dr. Eastern.

Pop quiz: How long have I been writing that private medical practices are businesses, whether we like it or not; and like any other business, they require consistent, sensible business management?

If you answered that I’ve been harping on that point from the very beginning, congratulations; you’re a long-time reader. And yet, the most basic and important business tool – preparation of an annual budget – continues to be ignored by most private practitioners.

The usual excuse is lack of time, and besides, the practice seems to be doing fine without one; but like anything else, you can’t fix problems you never look for.

You can’t identify needless, wasteful, or redundant purchases, under- or overstaffing, or misappropriated funds if you don’t track your practice’s expenditure data.

There is no way to make intelligent decisions on such basic issues as fee adjustments, new equipment purchases, and marketing strategies without a firm grasp of your expenditures, and a reasonable idea of where those numbers may be going in the foreseeable future. Without a budget you cannot know your costs of doing business, let alone whether they are too high or too low. Chances are excellent that you are overpaying your taxes, too.

Embezzlers typically continue their nefarious ways far longer than they should (and some are never caught at all) because all too often, nobody is watching the budget numbers. And if you are planning a refurbishment or expansion, no self-respecting bank will approve a loan in the post-TARP era without seeing a well-organized budget.

There is no need to wait to take action until, one day, your cash flow is too low to meet payroll, or a similar crisis convinces you that budgeting is important. Now, at the beginning of a new year, with last year’s financial data accumulated and readily at hand – and before significant changes mandated by the recent health care reform legislation take effect (more about that next month) – is an ideal time to get a budget in place.

If your practice is incorporated and your fiscal year does not begin on Jan. 1, don’t use that as an excuse; draw up a limited, "partial" budget for the remainder of this year, then start a new one when your next fiscal period begins.

Creating a budget is not the formidable or expensive task you may be envisioning. Unless your practice situation is unusually complex, you can probably do it yourself – although, if this is your first time, you will probably want to enlist the help of your accountant. A good spreadsheet program like Excel or iWork simplifies the process considerably, and financial software packages like QuickBooks or NetSuite make it even easier. (As always, I have no financial interest in any company or product mentioned in this column.)

Start by creating a list of practice expense categories, or "chart of accounts" (COA) in financial lingo. Each component of a COA is called a "line item," and in general, the more line items, the better. Commercial software products typically provide a standardized COA, but you will want to customize it to your individual needs. (Your accountant can help with that.) This is a critical step, so take your time, and do it right. The more detailed you make your COA, the more flexible your budget will be, the easier it will be to identify deductible expenses at year’s end, and the harder you will make it for an embezzler to operate unnoticed.

Then, using last year’s records (or if possible, an average of several years’), assign a dollar amount to each line item. Right away, some rude surprises may be in store ("We spend how much on printer ink?"), but already you are gaining valuable information that can be acted on immediately.

If you are not sure whether you are over- or underspending on a specific line item, or the category is a new one and you don’t know how much to allot, check with local colleagues or your accountant. Some practice management firms post lists of "benchmarks" averaged from surveys of their clients. Benchmark numbers can be deceptive, however, especially if the surveyed practices are in different parts of the country or have different socioeconomic populations.

Creating a budget is only the beginning; periodically, you must compare your actual expenditures with those you budgeted. (Most businesses do this quarterly; more frequent reviews can trigger needless worry over normal short-term fluctuations.)

Look for significant discrepancies and the reasons for them. Are your expenditures excessive, or was the budgeted amount unrealistic? Adjustments (of both expenditures and budget) will be frequent at first; but as time passes and your financial management skills improve, your practice will sail along on a progressively smoother financial course.

This column originally appeared in the publication Skin and Allergy News, a publication owned by Elsevier. Dr. Eastern practices dermatology and dermatologic surgery in Belleville, N.J. To respond to this column, e-mail Dr. Eastern.

Pop quiz: How long have I been writing that private medical practices are businesses, whether we like it or not; and like any other business, they require consistent, sensible business management?

If you answered that I’ve been harping on that point from the very beginning, congratulations; you’re a long-time reader. And yet, the most basic and important business tool – preparation of an annual budget – continues to be ignored by most private practitioners.

The usual excuse is lack of time, and besides, the practice seems to be doing fine without one; but like anything else, you can’t fix problems you never look for.

You can’t identify needless, wasteful, or redundant purchases, under- or overstaffing, or misappropriated funds if you don’t track your practice’s expenditure data.

There is no way to make intelligent decisions on such basic issues as fee adjustments, new equipment purchases, and marketing strategies without a firm grasp of your expenditures, and a reasonable idea of where those numbers may be going in the foreseeable future. Without a budget you cannot know your costs of doing business, let alone whether they are too high or too low. Chances are excellent that you are overpaying your taxes, too.

Embezzlers typically continue their nefarious ways far longer than they should (and some are never caught at all) because all too often, nobody is watching the budget numbers. And if you are planning a refurbishment or expansion, no self-respecting bank will approve a loan in the post-TARP era without seeing a well-organized budget.

There is no need to wait to take action until, one day, your cash flow is too low to meet payroll, or a similar crisis convinces you that budgeting is important. Now, at the beginning of a new year, with last year’s financial data accumulated and readily at hand – and before significant changes mandated by the recent health care reform legislation take effect (more about that next month) – is an ideal time to get a budget in place.

If your practice is incorporated and your fiscal year does not begin on Jan. 1, don’t use that as an excuse; draw up a limited, "partial" budget for the remainder of this year, then start a new one when your next fiscal period begins.

Creating a budget is not the formidable or expensive task you may be envisioning. Unless your practice situation is unusually complex, you can probably do it yourself – although, if this is your first time, you will probably want to enlist the help of your accountant. A good spreadsheet program like Excel or iWork simplifies the process considerably, and financial software packages like QuickBooks or NetSuite make it even easier. (As always, I have no financial interest in any company or product mentioned in this column.)

Start by creating a list of practice expense categories, or "chart of accounts" (COA) in financial lingo. Each component of a COA is called a "line item," and in general, the more line items, the better. Commercial software products typically provide a standardized COA, but you will want to customize it to your individual needs. (Your accountant can help with that.) This is a critical step, so take your time, and do it right. The more detailed you make your COA, the more flexible your budget will be, the easier it will be to identify deductible expenses at year’s end, and the harder you will make it for an embezzler to operate unnoticed.

Then, using last year’s records (or if possible, an average of several years’), assign a dollar amount to each line item. Right away, some rude surprises may be in store ("We spend how much on printer ink?"), but already you are gaining valuable information that can be acted on immediately.

If you are not sure whether you are over- or underspending on a specific line item, or the category is a new one and you don’t know how much to allot, check with local colleagues or your accountant. Some practice management firms post lists of "benchmarks" averaged from surveys of their clients. Benchmark numbers can be deceptive, however, especially if the surveyed practices are in different parts of the country or have different socioeconomic populations.

Creating a budget is only the beginning; periodically, you must compare your actual expenditures with those you budgeted. (Most businesses do this quarterly; more frequent reviews can trigger needless worry over normal short-term fluctuations.)

Look for significant discrepancies and the reasons for them. Are your expenditures excessive, or was the budgeted amount unrealistic? Adjustments (of both expenditures and budget) will be frequent at first; but as time passes and your financial management skills improve, your practice will sail along on a progressively smoother financial course.

This column originally appeared in the publication Skin and Allergy News, a publication owned by Elsevier. Dr. Eastern practices dermatology and dermatologic surgery in Belleville, N.J. To respond to this column, e-mail Dr. Eastern.

Pop quiz: How long have I been writing that private medical practices are businesses, whether we like it or not; and like any other business, they require consistent, sensible business management?

If you answered that I’ve been harping on that point from the very beginning, congratulations; you’re a long-time reader. And yet, the most basic and important business tool – preparation of an annual budget – continues to be ignored by most private practitioners.

The usual excuse is lack of time, and besides, the practice seems to be doing fine without one; but like anything else, you can’t fix problems you never look for.

You can’t identify needless, wasteful, or redundant purchases, under- or overstaffing, or misappropriated funds if you don’t track your practice’s expenditure data.

There is no way to make intelligent decisions on such basic issues as fee adjustments, new equipment purchases, and marketing strategies without a firm grasp of your expenditures, and a reasonable idea of where those numbers may be going in the foreseeable future. Without a budget you cannot know your costs of doing business, let alone whether they are too high or too low. Chances are excellent that you are overpaying your taxes, too.

Embezzlers typically continue their nefarious ways far longer than they should (and some are never caught at all) because all too often, nobody is watching the budget numbers. And if you are planning a refurbishment or expansion, no self-respecting bank will approve a loan in the post-TARP era without seeing a well-organized budget.

There is no need to wait to take action until, one day, your cash flow is too low to meet payroll, or a similar crisis convinces you that budgeting is important. Now, at the beginning of a new year, with last year’s financial data accumulated and readily at hand – and before significant changes mandated by the recent health care reform legislation take effect (more about that next month) – is an ideal time to get a budget in place.

If your practice is incorporated and your fiscal year does not begin on Jan. 1, don’t use that as an excuse; draw up a limited, "partial" budget for the remainder of this year, then start a new one when your next fiscal period begins.

Creating a budget is not the formidable or expensive task you may be envisioning. Unless your practice situation is unusually complex, you can probably do it yourself – although, if this is your first time, you will probably want to enlist the help of your accountant. A good spreadsheet program like Excel or iWork simplifies the process considerably, and financial software packages like QuickBooks or NetSuite make it even easier. (As always, I have no financial interest in any company or product mentioned in this column.)

Start by creating a list of practice expense categories, or "chart of accounts" (COA) in financial lingo. Each component of a COA is called a "line item," and in general, the more line items, the better. Commercial software products typically provide a standardized COA, but you will want to customize it to your individual needs. (Your accountant can help with that.) This is a critical step, so take your time, and do it right. The more detailed you make your COA, the more flexible your budget will be, the easier it will be to identify deductible expenses at year’s end, and the harder you will make it for an embezzler to operate unnoticed.

Then, using last year’s records (or if possible, an average of several years’), assign a dollar amount to each line item. Right away, some rude surprises may be in store ("We spend how much on printer ink?"), but already you are gaining valuable information that can be acted on immediately.

If you are not sure whether you are over- or underspending on a specific line item, or the category is a new one and you don’t know how much to allot, check with local colleagues or your accountant. Some practice management firms post lists of "benchmarks" averaged from surveys of their clients. Benchmark numbers can be deceptive, however, especially if the surveyed practices are in different parts of the country or have different socioeconomic populations.

Creating a budget is only the beginning; periodically, you must compare your actual expenditures with those you budgeted. (Most businesses do this quarterly; more frequent reviews can trigger needless worry over normal short-term fluctuations.)

Look for significant discrepancies and the reasons for them. Are your expenditures excessive, or was the budgeted amount unrealistic? Adjustments (of both expenditures and budget) will be frequent at first; but as time passes and your financial management skills improve, your practice will sail along on a progressively smoother financial course.

This column originally appeared in the publication Skin and Allergy News, a publication owned by Elsevier. Dr. Eastern practices dermatology and dermatologic surgery in Belleville, N.J. To respond to this column, e-mail Dr. Eastern.

Management of accounts receivable is a significant issue in all private offices, and I’ve addressed it from multiple angles in previous columns.

In most cases, the patient-owed portion can be kept out of the accounts receivable in the first place. Collect as much as possible at the time of service, even if you have to offer a discount for immediate payment. When immediate payment is impossible, or you must wait for the insurance explanation of benefits, ask for a credit card number that you can keep on file and charge as soon as you know the balance due.

Sending statements should be a last resort, but they should be sent promptly, and no more than three times before you refer the account for collection.

All of these points, and others, were covered in detail in several previous columns, which you can find by clicking on Managing Your Dermatology Practice at the Skin & Allergy News Web site.

Most difficult or awkward collection problems can be categorized, and you should have a standardized strategy or process for dealing with each of them. Those strategies should be assembled as a formal written policy and applied consistently each time they arise. Such a policy begins by considering possible scenarios.

Try to standardize as many situations as possible; for example, make a list of any situation in which you always want the patient balance written off, or always want the balance sent to a collection agency without your direction, or always want to make a case-by-case decision.

Be as specific as possible. What do you want done, for example, when a patient is deceased? Do you want to bill the family or estate, or write off the balance as a bad debt, or some combination of the two? My office has a “sliding scale” based on the size of the balance due, ranging from writing off the smallest balances to deciding the fate of the largest on a case-by-case basis. The occasional very large balance might merit referral to a specialized company for a probate search, or other identification of accessible funds.

What about a patient who claims to have been laid off from his or her job and does not pay a balance or discontinues payments? Options include referring the account to your collection agency, writing off the balance, or negotiating payment of a reduced balance.

If a patient has no insurance and requests a discount at, or prior to, the time of service, you will need to decide if you want to give one, and if so, how much and under which circumstances. As an example, my basic no-insurance discount is 40% if payment is made at the time of the visit. Those who can’t pay immediately are offered 25% off if they pay within 30 days of service, 10% if within 60 days. Cases of particular hardship are worked out on an individual basis.

We have a similar policy for patients who have insurance that my office does not accept. In many states, such discounts must be indiscriminant, as I discussed in a previous column, although most statutes permit exceptions in situations of financial hardship.

For inpatient services, when the hospital has discounted or written off the patient balance and the patient requests a discount, our standard policy is to match the discount granted by the hospital.

For small balances that remain unpaid after reasonable efforts have been made to collect from the patient, my standard policy is to write off balances of less than $25.00 and refer the rest for collection.

Delinquent accounts, after collection efforts have been exhausted without success, are usually unsalvageable; but, occasionally, patients will attempt to negotiate a settlement, once they realize the damage done to their credit rating by a delinquency. I am less generous with discounts under such circumstances, of course, but I usually take 5% off if the balance is paid in full within 10 days, and 10% if paid by credit card immediately, over the phone. We require them to complete a standard “hardship form” in order to apply for a larger discount.

Keep in mind that nobody collects every balance owed. This is the reality in any business, especially a medical one. The main objective here is to do everything possible to minimize uncollected accounts. The keys are to develop a system that works, and to be disciplined about implementing it.

Management of accounts receivable is a significant issue in all private offices, and I’ve addressed it from multiple angles in previous columns.

In most cases, the patient-owed portion can be kept out of the accounts receivable in the first place. Collect as much as possible at the time of service, even if you have to offer a discount for immediate payment. When immediate payment is impossible, or you must wait for the insurance explanation of benefits, ask for a credit card number that you can keep on file and charge as soon as you know the balance due.

Sending statements should be a last resort, but they should be sent promptly, and no more than three times before you refer the account for collection.

All of these points, and others, were covered in detail in several previous columns, which you can find by clicking on Managing Your Dermatology Practice at the Skin & Allergy News Web site.

Most difficult or awkward collection problems can be categorized, and you should have a standardized strategy or process for dealing with each of them. Those strategies should be assembled as a formal written policy and applied consistently each time they arise. Such a policy begins by considering possible scenarios.

Try to standardize as many situations as possible; for example, make a list of any situation in which you always want the patient balance written off, or always want the balance sent to a collection agency without your direction, or always want to make a case-by-case decision.

Be as specific as possible. What do you want done, for example, when a patient is deceased? Do you want to bill the family or estate, or write off the balance as a bad debt, or some combination of the two? My office has a “sliding scale” based on the size of the balance due, ranging from writing off the smallest balances to deciding the fate of the largest on a case-by-case basis. The occasional very large balance might merit referral to a specialized company for a probate search, or other identification of accessible funds.

What about a patient who claims to have been laid off from his or her job and does not pay a balance or discontinues payments? Options include referring the account to your collection agency, writing off the balance, or negotiating payment of a reduced balance.

If a patient has no insurance and requests a discount at, or prior to, the time of service, you will need to decide if you want to give one, and if so, how much and under which circumstances. As an example, my basic no-insurance discount is 40% if payment is made at the time of the visit. Those who can’t pay immediately are offered 25% off if they pay within 30 days of service, 10% if within 60 days. Cases of particular hardship are worked out on an individual basis.

We have a similar policy for patients who have insurance that my office does not accept. In many states, such discounts must be indiscriminant, as I discussed in a previous column, although most statutes permit exceptions in situations of financial hardship.

For inpatient services, when the hospital has discounted or written off the patient balance and the patient requests a discount, our standard policy is to match the discount granted by the hospital.

For small balances that remain unpaid after reasonable efforts have been made to collect from the patient, my standard policy is to write off balances of less than $25.00 and refer the rest for collection.

Delinquent accounts, after collection efforts have been exhausted without success, are usually unsalvageable; but, occasionally, patients will attempt to negotiate a settlement, once they realize the damage done to their credit rating by a delinquency. I am less generous with discounts under such circumstances, of course, but I usually take 5% off if the balance is paid in full within 10 days, and 10% if paid by credit card immediately, over the phone. We require them to complete a standard “hardship form” in order to apply for a larger discount.

Keep in mind that nobody collects every balance owed. This is the reality in any business, especially a medical one. The main objective here is to do everything possible to minimize uncollected accounts. The keys are to develop a system that works, and to be disciplined about implementing it.

Management of accounts receivable is a significant issue in all private offices, and I’ve addressed it from multiple angles in previous columns.

In most cases, the patient-owed portion can be kept out of the accounts receivable in the first place. Collect as much as possible at the time of service, even if you have to offer a discount for immediate payment. When immediate payment is impossible, or you must wait for the insurance explanation of benefits, ask for a credit card number that you can keep on file and charge as soon as you know the balance due.

Sending statements should be a last resort, but they should be sent promptly, and no more than three times before you refer the account for collection.

All of these points, and others, were covered in detail in several previous columns, which you can find by clicking on Managing Your Dermatology Practice at the Skin & Allergy News Web site.

Most difficult or awkward collection problems can be categorized, and you should have a standardized strategy or process for dealing with each of them. Those strategies should be assembled as a formal written policy and applied consistently each time they arise. Such a policy begins by considering possible scenarios.

Try to standardize as many situations as possible; for example, make a list of any situation in which you always want the patient balance written off, or always want the balance sent to a collection agency without your direction, or always want to make a case-by-case decision.

Be as specific as possible. What do you want done, for example, when a patient is deceased? Do you want to bill the family or estate, or write off the balance as a bad debt, or some combination of the two? My office has a “sliding scale” based on the size of the balance due, ranging from writing off the smallest balances to deciding the fate of the largest on a case-by-case basis. The occasional very large balance might merit referral to a specialized company for a probate search, or other identification of accessible funds.

What about a patient who claims to have been laid off from his or her job and does not pay a balance or discontinues payments? Options include referring the account to your collection agency, writing off the balance, or negotiating payment of a reduced balance.

If a patient has no insurance and requests a discount at, or prior to, the time of service, you will need to decide if you want to give one, and if so, how much and under which circumstances. As an example, my basic no-insurance discount is 40% if payment is made at the time of the visit. Those who can’t pay immediately are offered 25% off if they pay within 30 days of service, 10% if within 60 days. Cases of particular hardship are worked out on an individual basis.

We have a similar policy for patients who have insurance that my office does not accept. In many states, such discounts must be indiscriminant, as I discussed in a previous column, although most statutes permit exceptions in situations of financial hardship.

For inpatient services, when the hospital has discounted or written off the patient balance and the patient requests a discount, our standard policy is to match the discount granted by the hospital.

For small balances that remain unpaid after reasonable efforts have been made to collect from the patient, my standard policy is to write off balances of less than $25.00 and refer the rest for collection.

Delinquent accounts, after collection efforts have been exhausted without success, are usually unsalvageable; but, occasionally, patients will attempt to negotiate a settlement, once they realize the damage done to their credit rating by a delinquency. I am less generous with discounts under such circumstances, of course, but I usually take 5% off if the balance is paid in full within 10 days, and 10% if paid by credit card immediately, over the phone. We require them to complete a standard “hardship form” in order to apply for a larger discount.

Keep in mind that nobody collects every balance owed. This is the reality in any business, especially a medical one. The main objective here is to do everything possible to minimize uncollected accounts. The keys are to develop a system that works, and to be disciplined about implementing it.

Management of accounts receivable is a significant issue in all private offices, and I’ve addressed it from multiple angles in previous columns.

In most cases, the patient-owed portion can be kept out of the accounts receivable in the first place. Collect as much as possible at the time of service, even if you have to offer a discount for immediate payment. When immediate payment is impossible, or you must wait for the insurance explanation of benefits, ask for a credit card number that you can keep on file and charge as soon as you know the balance due.

Sending statements should be a last resort, but they should be sent promptly, and no more than three times before you refer the account for collection.

All of these points, and others, were covered in detail in several previous columns, which you can find by clicking on Managing Your Dermatology Practice at the Skin & Allergy News Web site.

Most difficult or awkward collection problems can be categorized, and you should have a standardized strategy or process for dealing with each of them. Those strategies should be assembled as a formal written policy and applied consistently each time they arise. Such a policy begins by considering possible scenarios.

Try to standardize as many situations as possible; for example, make a list of any situation in which you always want the patient balance written off, or always want the balance sent to a collection agency without your direction, or always want to make a case-by-case decision.

Be as specific as possible. What do you want done, for example, when a patient is deceased? Do you want to bill the family or estate, or write off the balance as a bad debt, or some combination of the two? My office has a “sliding scale” based on the size of the balance due, ranging from writing off the smallest balances to deciding the fate of the largest on a case-by-case basis. The occasional very large balance might merit referral to a specialized company for a probate search, or other identification of accessible funds.

What about a patient who claims to have been laid off from his or her job and does not pay a balance or discontinues payments? Options include referring the account to your collection agency, writing off the balance, or negotiating payment of a reduced balance.

If a patient has no insurance and requests a discount at, or prior to, the time of service, you will need to decide if you want to give one, and if so, how much and under which circumstances. As an example, my basic no-insurance discount is 40% if payment is made at the time of the visit. Those who can’t pay immediately are offered 25% off if they pay within 30 days of service, 10% if within 60 days. Cases of particular hardship are worked out on an individual basis.

We have a similar policy for patients who have insurance that my office does not accept. In many states, such discounts must be indiscriminant, as I discussed in a previous column, although most statutes permit exceptions in situations of financial hardship.

For inpatient services, when the hospital has discounted or written off the patient balance and the patient requests a discount, our standard policy is to match the discount granted by the hospital.

For small balances that remain unpaid after reasonable efforts have been made to collect from the patient, my standard policy is to write off balances of less than $25.00 and refer the rest for collection.

Delinquent accounts, after collection efforts have been exhausted without success, are usually unsalvageable; but, occasionally, patients will attempt to negotiate a settlement, once they realize the damage done to their credit rating by a delinquency. I am less generous with discounts under such circumstances, of course, but I usually take 5% off if the balance is paid in full within 10 days, and 10% if paid by credit card immediately, over the phone. We require them to complete a standard “hardship form” in order to apply for a larger discount.

Keep in mind that nobody collects every balance owed. This is the reality in any business, especially a medical one. The main objective here is to do everything possible to minimize uncollected accounts. The keys are to develop a system that works, and to be disciplined about implementing it.

Dr. Eastern practices dermatology and dermatologic surgery in Belleville, N.J. To respond to this column, e-mail Dr. Eastern at [email protected].

Management of accounts receivable is a significant issue in all private offices, and I’ve addressed it from multiple angles in previous columns.

In most cases, the patient-owed portion can be kept out of the accounts receivable in the first place. Collect as much as possible at the time of service, even if you have to offer a discount for immediate payment. When immediate payment is impossible, or you must wait for the insurance explanation of benefits, ask for a credit card number that you can keep on file and charge as soon as you know the balance due.

Sending statements should be a last resort, but they should be sent promptly, and no more than three times before you refer the account for collection.

All of these points, and others, were covered in detail in several previous columns, which you can find by clicking on Managing Your Dermatology Practice at the Skin & Allergy News Web site.

Most difficult or awkward collection problems can be categorized, and you should have a standardized strategy or process for dealing with each of them. Those strategies should be assembled as a formal written policy and applied consistently each time they arise. Such a policy begins by considering possible scenarios.

Try to standardize as many situations as possible; for example, make a list of any situation in which you always want the patient balance written off, or always want the balance sent to a collection agency without your direction, or always want to make a case-by-case decision.

Be as specific as possible. What do you want done, for example, when a patient is deceased? Do you want to bill the family or estate, or write off the balance as a bad debt, or some combination of the two? My office has a “sliding scale” based on the size of the balance due, ranging from writing off the smallest balances to deciding the fate of the largest on a case-by-case basis. The occasional very large balance might merit referral to a specialized company for a probate search, or other identification of accessible funds.

What about a patient who claims to have been laid off from his or her job and does not pay a balance or discontinues payments? Options include referring the account to your collection agency, writing off the balance, or negotiating payment of a reduced balance.

If a patient has no insurance and requests a discount at, or prior to, the time of service, you will need to decide if you want to give one, and if so, how much and under which circumstances. As an example, my basic no-insurance discount is 40% if payment is made at the time of the visit. Those who can’t pay immediately are offered 25% off if they pay within 30 days of service, 10% if within 60 days. Cases of particular hardship are worked out on an individual basis.

We have a similar policy for patients who have insurance that my office does not accept. In many states, such discounts must be indiscriminant, as I discussed in a previous column, although most statutes permit exceptions in situations of financial hardship.

For inpatient services, when the hospital has discounted or written off the patient balance and the patient requests a discount, our standard policy is to match the discount granted by the hospital.

For small balances that remain unpaid after reasonable efforts have been made to collect from the patient, my standard policy is to write off balances of less than $25.00 and refer the rest for collection.

Delinquent accounts, after collection efforts have been exhausted without success, are usually unsalvageable; but, occasionally, patients will attempt to negotiate a settlement, once they realize the damage done to their credit rating by a delinquency. I am less generous with discounts under such circumstances, of course, but I usually take 5% off if the balance is paid in full within 10 days, and 10% if paid by credit card immediately, over the phone. We require them to complete a standard “hardship form” in order to apply for a larger discount.

Keep in mind that nobody collects every balance owed. This is the reality in any business, especially a medical one. The main objective here is to do everything possible to minimize uncollected accounts. The keys are to develop a system that works, and to be disciplined about implementing it.

Dr. Eastern practices dermatology and dermatologic surgery in Belleville, N.J. To respond to this column, e-mail Dr. Eastern at [email protected].

Management of accounts receivable is a significant issue in all private offices, and I’ve addressed it from multiple angles in previous columns.

In most cases, the patient-owed portion can be kept out of the accounts receivable in the first place. Collect as much as possible at the time of service, even if you have to offer a discount for immediate payment. When immediate payment is impossible, or you must wait for the insurance explanation of benefits, ask for a credit card number that you can keep on file and charge as soon as you know the balance due.

Sending statements should be a last resort, but they should be sent promptly, and no more than three times before you refer the account for collection.

All of these points, and others, were covered in detail in several previous columns, which you can find by clicking on Managing Your Dermatology Practice at the Skin & Allergy News Web site.

Most difficult or awkward collection problems can be categorized, and you should have a standardized strategy or process for dealing with each of them. Those strategies should be assembled as a formal written policy and applied consistently each time they arise. Such a policy begins by considering possible scenarios.

Try to standardize as many situations as possible; for example, make a list of any situation in which you always want the patient balance written off, or always want the balance sent to a collection agency without your direction, or always want to make a case-by-case decision.

Be as specific as possible. What do you want done, for example, when a patient is deceased? Do you want to bill the family or estate, or write off the balance as a bad debt, or some combination of the two? My office has a “sliding scale” based on the size of the balance due, ranging from writing off the smallest balances to deciding the fate of the largest on a case-by-case basis. The occasional very large balance might merit referral to a specialized company for a probate search, or other identification of accessible funds.

What about a patient who claims to have been laid off from his or her job and does not pay a balance or discontinues payments? Options include referring the account to your collection agency, writing off the balance, or negotiating payment of a reduced balance.

If a patient has no insurance and requests a discount at, or prior to, the time of service, you will need to decide if you want to give one, and if so, how much and under which circumstances. As an example, my basic no-insurance discount is 40% if payment is made at the time of the visit. Those who can’t pay immediately are offered 25% off if they pay within 30 days of service, 10% if within 60 days. Cases of particular hardship are worked out on an individual basis.

We have a similar policy for patients who have insurance that my office does not accept. In many states, such discounts must be indiscriminant, as I discussed in a previous column, although most statutes permit exceptions in situations of financial hardship.

For inpatient services, when the hospital has discounted or written off the patient balance and the patient requests a discount, our standard policy is to match the discount granted by the hospital.

For small balances that remain unpaid after reasonable efforts have been made to collect from the patient, my standard policy is to write off balances of less than $25.00 and refer the rest for collection.

Delinquent accounts, after collection efforts have been exhausted without success, are usually unsalvageable; but, occasionally, patients will attempt to negotiate a settlement, once they realize the damage done to their credit rating by a delinquency. I am less generous with discounts under such circumstances, of course, but I usually take 5% off if the balance is paid in full within 10 days, and 10% if paid by credit card immediately, over the phone. We require them to complete a standard “hardship form” in order to apply for a larger discount.

Keep in mind that nobody collects every balance owed. This is the reality in any business, especially a medical one. The main objective here is to do everything possible to minimize uncollected accounts. The keys are to develop a system that works, and to be disciplined about implementing it.

Dr. Eastern practices dermatology and dermatologic surgery in Belleville, N.J. To respond to this column, e-mail Dr. Eastern at [email protected].

It’s interesting that the more things change, the more they stay the same. The most easily correctable problem I see in private offices today is the same one I saw 30 years ago: underdelegation. (A newer and more alarming problem is overdelegation, but we’ll get to that later.)

Private practitioners famously spend inordinate amounts of time embroiled in minutiae. After all, they are continually hearing the same mantra from know-it-alls like me: The physician is the captain of the vessel, and ultimate responsibility for everyone’s screw-ups rests with you; ergo, as captain, you must run a tight ship.

There is a big difference, however, between maintaining control of your practice’s inner workings and micromanaging the day-to-day details. One never sees a ship’s captain swabbing the decks, cooking the meals, or fixing the engine, and you shouldn’t be billing, purchasing, or arguing with pharmacists when there are patients to see.

Most doctors do delegate, of course, but many don’t do it enough. Try this experiment: For a week, write down everything you do around the office, especially the menial stuff. Then, over the weekend, look at your list. You’ll probably be surprised at how much time you waste on chores that could be delegated.

Handing off tasks can be hard – especially if you have the “nobody does it as well as I do” disease. My rule of thumb: Everything requiring a physician’s license should be done by physicians; everything else should be done by employees or contractors.

I know what you’re thinking: This is going to cost me, and the results won’t be up to my standards. Your overhead may increase while employees learn new duties. You may also need to raise salaries to compensate for the increased workload, or even hire a new person or two. Simple arithmetic, though, will show that in the long run a new employee working at a fraction of your hourly rate will do the job cheaper than you can. Granted, you cannot expect them to immediately do it as well as you do, but with time, proper training, and a bit of patience, employees will nearly always meet, and even exceed, your expectations.

Be alert, however, for something I call reverse delegation. It’s not at all unusual for an employee, faced with a new assignment, to pepper the boss with questions, complaints, and fears about doing it properly. It’s easy, at this point, to yield to the pressure and simply do the job yourself. You have taken the bait: Your subordinate has delegated the task back to you!

If you employ nurse practitioners or physician assistants, reassess your options with them as well. Consider additional aspects of examination, diagnosis, testing, and treatment of routine patients that they could be doing, which will in turn free up more of your time for new patients and complex cases.

Remember, though, that state laws vary on who can delegate what to whom. Consult your attorney and local medical association if there is any question about what your state permits, particularly with regard to NPs and PAs.

And that brings us to the disturbing trend of overdelegation. Last year, the Department of Health and Human Services’ Office of Inspector General (a government office you never want to hear from) looked at services billed under Medicare’s “incident-to” rule to determine whether nonphysician billings were appropriate. When suspicious data were identified – for example, when billed services for a single day exceeded 24 hours – the suspect practice was investigated.

The OIG’s report concluded that 21% of services not performed personally by physicians in their selective sample were performed by unqualified nonphysicians.

Offices were found in which Mohs was being delegated to unqualified staff, including, in some cases, untrained medical assistants. The report was based on a relatively small sample, so it is not clear how prevalent such practices are, but, clearly, any prevalence is too high, and you will not fare well with the OIG if you are caught.

Delegating doesn’t mean handing off a task and forgetting about it. Always maintain an open flow of communication with your employees. A good boss does not micromanage, but does remain in the loop.

Dr. Joseph S. Eastern writes the column, “Managing Your Dermatology Practice,” which regularly appears in Skin & Allergy News, an Elsevier publication. Dr. Eastern practices dermatology and dermatologic surgery in Belleville, N.J. To respond to this column, e-mail Dr. Eastern at our editorial offices at [email protected].

It’s interesting that the more things change, the more they stay the same. The most easily correctable problem I see in private offices today is the same one I saw 30 years ago: underdelegation. (A newer and more alarming problem is overdelegation, but we’ll get to that later.)

Private practitioners famously spend inordinate amounts of time embroiled in minutiae. After all, they are continually hearing the same mantra from know-it-alls like me: The physician is the captain of the vessel, and ultimate responsibility for everyone’s screw-ups rests with you; ergo, as captain, you must run a tight ship.

There is a big difference, however, between maintaining control of your practice’s inner workings and micromanaging the day-to-day details. One never sees a ship’s captain swabbing the decks, cooking the meals, or fixing the engine, and you shouldn’t be billing, purchasing, or arguing with pharmacists when there are patients to see.

Most doctors do delegate, of course, but many don’t do it enough. Try this experiment: For a week, write down everything you do around the office, especially the menial stuff. Then, over the weekend, look at your list. You’ll probably be surprised at how much time you waste on chores that could be delegated.

Handing off tasks can be hard – especially if you have the “nobody does it as well as I do” disease. My rule of thumb: Everything requiring a physician’s license should be done by physicians; everything else should be done by employees or contractors.

I know what you’re thinking: This is going to cost me, and the results won’t be up to my standards. Your overhead may increase while employees learn new duties. You may also need to raise salaries to compensate for the increased workload, or even hire a new person or two. Simple arithmetic, though, will show that in the long run a new employee working at a fraction of your hourly rate will do the job cheaper than you can. Granted, you cannot expect them to immediately do it as well as you do, but with time, proper training, and a bit of patience, employees will nearly always meet, and even exceed, your expectations.

Be alert, however, for something I call reverse delegation. It’s not at all unusual for an employee, faced with a new assignment, to pepper the boss with questions, complaints, and fears about doing it properly. It’s easy, at this point, to yield to the pressure and simply do the job yourself. You have taken the bait: Your subordinate has delegated the task back to you!

If you employ nurse practitioners or physician assistants, reassess your options with them as well. Consider additional aspects of examination, diagnosis, testing, and treatment of routine patients that they could be doing, which will in turn free up more of your time for new patients and complex cases.

Remember, though, that state laws vary on who can delegate what to whom. Consult your attorney and local medical association if there is any question about what your state permits, particularly with regard to NPs and PAs.

And that brings us to the disturbing trend of overdelegation. Last year, the Department of Health and Human Services’ Office of Inspector General (a government office you never want to hear from) looked at services billed under Medicare’s “incident-to” rule to determine whether nonphysician billings were appropriate. When suspicious data were identified – for example, when billed services for a single day exceeded 24 hours – the suspect practice was investigated.

The OIG’s report concluded that 21% of services not performed personally by physicians in their selective sample were performed by unqualified nonphysicians.

Offices were found in which Mohs was being delegated to unqualified staff, including, in some cases, untrained medical assistants. The report was based on a relatively small sample, so it is not clear how prevalent such practices are, but, clearly, any prevalence is too high, and you will not fare well with the OIG if you are caught.

Delegating doesn’t mean handing off a task and forgetting about it. Always maintain an open flow of communication with your employees. A good boss does not micromanage, but does remain in the loop.

Dr. Joseph S. Eastern writes the column, “Managing Your Dermatology Practice,” which regularly appears in Skin & Allergy News, an Elsevier publication. Dr. Eastern practices dermatology and dermatologic surgery in Belleville, N.J. To respond to this column, e-mail Dr. Eastern at our editorial offices at [email protected].

It’s interesting that the more things change, the more they stay the same. The most easily correctable problem I see in private offices today is the same one I saw 30 years ago: underdelegation. (A newer and more alarming problem is overdelegation, but we’ll get to that later.)

Private practitioners famously spend inordinate amounts of time embroiled in minutiae. After all, they are continually hearing the same mantra from know-it-alls like me: The physician is the captain of the vessel, and ultimate responsibility for everyone’s screw-ups rests with you; ergo, as captain, you must run a tight ship.

There is a big difference, however, between maintaining control of your practice’s inner workings and micromanaging the day-to-day details. One never sees a ship’s captain swabbing the decks, cooking the meals, or fixing the engine, and you shouldn’t be billing, purchasing, or arguing with pharmacists when there are patients to see.

Most doctors do delegate, of course, but many don’t do it enough. Try this experiment: For a week, write down everything you do around the office, especially the menial stuff. Then, over the weekend, look at your list. You’ll probably be surprised at how much time you waste on chores that could be delegated.

Handing off tasks can be hard – especially if you have the “nobody does it as well as I do” disease. My rule of thumb: Everything requiring a physician’s license should be done by physicians; everything else should be done by employees or contractors.

I know what you’re thinking: This is going to cost me, and the results won’t be up to my standards. Your overhead may increase while employees learn new duties. You may also need to raise salaries to compensate for the increased workload, or even hire a new person or two. Simple arithmetic, though, will show that in the long run a new employee working at a fraction of your hourly rate will do the job cheaper than you can. Granted, you cannot expect them to immediately do it as well as you do, but with time, proper training, and a bit of patience, employees will nearly always meet, and even exceed, your expectations.

Be alert, however, for something I call reverse delegation. It’s not at all unusual for an employee, faced with a new assignment, to pepper the boss with questions, complaints, and fears about doing it properly. It’s easy, at this point, to yield to the pressure and simply do the job yourself. You have taken the bait: Your subordinate has delegated the task back to you!

If you employ nurse practitioners or physician assistants, reassess your options with them as well. Consider additional aspects of examination, diagnosis, testing, and treatment of routine patients that they could be doing, which will in turn free up more of your time for new patients and complex cases.

Remember, though, that state laws vary on who can delegate what to whom. Consult your attorney and local medical association if there is any question about what your state permits, particularly with regard to NPs and PAs.

And that brings us to the disturbing trend of overdelegation. Last year, the Department of Health and Human Services’ Office of Inspector General (a government office you never want to hear from) looked at services billed under Medicare’s “incident-to” rule to determine whether nonphysician billings were appropriate. When suspicious data were identified – for example, when billed services for a single day exceeded 24 hours – the suspect practice was investigated.

The OIG’s report concluded that 21% of services not performed personally by physicians in their selective sample were performed by unqualified nonphysicians.

Offices were found in which Mohs was being delegated to unqualified staff, including, in some cases, untrained medical assistants. The report was based on a relatively small sample, so it is not clear how prevalent such practices are, but, clearly, any prevalence is too high, and you will not fare well with the OIG if you are caught.

Delegating doesn’t mean handing off a task and forgetting about it. Always maintain an open flow of communication with your employees. A good boss does not micromanage, but does remain in the loop.

Dr. Joseph S. Eastern writes the column, “Managing Your Dermatology Practice,” which regularly appears in Skin & Allergy News, an Elsevier publication. Dr. Eastern practices dermatology and dermatologic surgery in Belleville, N.J. To respond to this column, e-mail Dr. Eastern at our editorial offices at [email protected].