Four Strategies to Boost Your Medical Practice - A Review of Dr Baum's Article

On April 12, 2025 an article written by Dr. Neil Baum was published on KevinMD dot com. The article is titled, 4 strategies to boost your medical practice’s profitability. It is an excellent article and I am summarizing it in this video.

The Horowitz office defends physicians in practice related disputes but we do not actually merge practices or focus on profitability. We value this article because practices which are under financial stress often fall into trouble with regulatory matters, medical board complaints and malpractice actions. We hope that some of the ideas in Dr. Baum’s article assist you in avoiding those problems.

We know that individual physicians are increasingly treated like cogs in a big wheel. The profits have now shifted from the doctor to equipment providers, machine owners, labs, testing facilities, hospitals and other for profit corporate or LLC based entities.

According to an AMA analysis, inflation adjusted Medicare reimbursement rates dropped 22 percent from 2001 to 2021, while insurers of Affordable Care Act plans denied 17 percent of in network claims in 2021.

The profit margin of most medical practices are not high. These reimbursement changes can cut net income drastically, maybe even in half. That means that the joke that a physician makes less than a plumber is often a reality.

Dr. Baum suggests four strategic approaches to maintaining financial stability all of which we endorse as safe, rational and not likely to lead to future licensing or partnership problems.

First he recommends cutting Overhead by Improving Efficiency. He is not advocating cutting corners, he suggests that rational cost cutting can enhance patient care and profitability.

We see many practices that lack good patient coordination. This leads to missed appointments or long waits for patients and less referrals of new patients. Simple scheduling efficiency can help in this area.

You may have to spend some money. Your old software or work flow practices may need updating. Automated intake and forms processing can free up staff time.

Perhaps most important is increasing collections. The article cites a 95 percent level of collection to ensures financial stability. Few practices have that reimbursement level.

We believe that bills to patients are a common weak point. The patient needs to open the bill and
understand what they are paying for. A simple large dollar amount, insurance payment and patient amount is bare bones. No patient smiles while paying that bill. Some degree of humanization and explanation won’t kill you. However most practices use of the shelf billing and ask for money like a collection agency rather than as a trusted health partner and friend.

Billing speed and effective tracking of insurance and governmental submissions depends upon using the right software and providing complete and accurate information at the time of submission. Ten year old systems are not going to meet the standard outlined by Dr. Baum.

Third he focuses on boosting Productivity

You may need a consultant to look at your scheduling, work flow and physical layout.

Daniel Horowitz our lead counsel was the lawyer for many large nightclubs. The successful operators spent hours planning the proximity of the bar to the music, ease of access to the bar by wait staff and the layout of bar itself. The beer, wine and hard alcohol were strategically placed to enhance bar tender efficiency. In our experience bars give more attention to work flow and layout than medical offices. You may have to hire someone to do this work but it is a major factor in improving work place productivity.

You can also use software and consultants to assess your practice as if it were a business about to present itself on Shark Tank. A strong corporate analysis will assess efficiency not just in terms of revenues generated but revenues generated by subcategories. What is the highest value service based upon dollars generated per staff person time? Ask the same question with respect to physician time.

Do you know which services lead to higher reimbursement percentages. Do some services generate 95% collection and others 90? The answer will be yes and you need to see whether this is a statistical aberration or whether there is a root cause.

A final recommendation is to Merge with a Nearby Practice. The Horowitz office does not handle mergers but it is black letter in economics that mergers lead to large efficiencies. It is possible to hire an attorney who can merge office based issues and staffing while maintaining physician independence. It is not easy and it can lead to more problems than it solves but ultimately we agree with Dr. Baum that this is worth considering. In time mergers may become a necessity and small to medium practices may be a relic.

Daniel Horowitz represents physicians in business disputes, medical board and licensing matters as well as peer review and malpractice cases.