To determine whether your practice could benefit from automating administrative functions, first take a close look at your various office processes. For example, consider how many hours you spend on such activities as:
completing forms or entering data
mailing/faxing forms and other documents
submitting and tracking insurance claims
billing and tracking accounts receivable
Then consider whether you could be using your time, and your administrative staff's time, more effectively. For example, could you increase your efficiency and improve your practice's bottom line with new practice management software?
Next, evaluate the cost of implementing automation technologies against the value of the time you currently spend on the corresponding administrative activities. This is known as a cost-benefit analysis. For example, consider how many clinical hours it would take to pay for the cost of hardware and software that would improve your effectiveness and efficiency. Could you recover the cost of hardware and software over the course of one year, ending the year in a better financial position than if you had not automated? For larger practices that would require more elaborate and expensive technology solutions, could you cover the cost in three years?
Also consider the potential impact of purchasing services, such as credit card processing, full-service billing, or electronic claims submission services, instead of handling these functions on your own. Would such services improve your cash flow, save you time, reduce duplicate data entry, improve tracking or reduce your overhead expenses?
Consider, for example, the following hypothetical situation: If you spend 15 hours per month submitting and tracking insurance claims, and you typically charge $100 per hour for your clinical services, the cost of doing that administrative task yourself is $1500 per month. If you were to pay $40 per month for an electronic claims submission service that allowed you to cut the time you spend on the task to five hours per month, you might have the following options: You could have ten extra hours per month to provide clinical services, generating approximately $11,500 in additional income by the end of the year. Or, you could have seven extra hours per month to provide clinical services and three extra hours per month to market your practice, catch up on the latest research literature, and participate in other professional activities, generating approximately $7,900 in additional income by the end of the year.
In addition, look into how automating your business could bring your practice into regulatory compliance.
Federal HIPAA Transaction, Privacy and Security Rules. Many electronic products and services have "built in" HIPAA safeguards and protections.
State Laws and Regulations (such as record keeping and other state-specific requirements) and Professional Guidelines (such as the APA Ethical Principles of Psychologists and Code of Conduct and the APA Record Keeping Guidelines, which are currently under revision). Electronic storage of records can make record retention, storage, and retrieval easier and more efficient.
It is important to note that automating office tasks does not eliminate practitioner's oversight responsibilities. When administrative functions, such as billing, are automated, they still need to be managed and, in fact, they may demand an additional investment of time and financial resources during the implementation period. However, with careful analysis and thoughtful implementation, over time practitioners should enjoy overall reduced administrative headaches connected to these tasks when they are automated.
It is important to automate your practice in a way that works best for you. The best approach for you may include automating some tasks and continuing to do some tasks yourself or hiring administrative staff to handle some tasks.
An important step in deciding whether or to what extent you should automate your administrative functions is to examine your various office processes, from billing to scheduling client appointments to making referrals, and look for ways to make them more efficient and cost effective. The next article in this series is designed to help you do that by explaining how to conduct a technology needs assessment for a psychology practice.