I recently was talking to a long-time co-worker and friend in a leadership position in a health-care office who commented, “What is this KPI stuff everyone keeps talking about?” I had to pause a moment to consider that someone in a significant position in health care would not understand what that is and why she should care. I began to poll colleagues, friends, professionals, and externs, and found that the majority had no clue what I was referencing. I was quite taken aback.
The ability to have good tracking data and analytics, in the age of the Merit Incentive Payment System (MIPS), is a necessity and not optional. The MIPS is a new payment mechanism that will provide annual updates to physicians starting in 2019, based on performance in four categories: (1) quality, (2) resource use, (3) clinical practice improvement activities, and (4) meaningful use of an electronic health record system (U.S. Department of Health and Human Services, 2019).
In 2019, audiologists will be counted among the professionals in which this applies. All of these areas will require supportive data to participate and validate information.
What Does KPI Mean?
Key performance indicators or a KPI is a measurable value that demonstrates how effectively a company is achieving key business objectives. There can be many types of tracking and values. The key is to know what values and data are relevant for your practice. The other significant piece relates to the company and department objectives (Mauboussin, 2012).
I know, I know; we are audiologists. This does not preclude us from being quite capable of running a business, knowing our practice, and making meaningful decisions with data from the clinical side and the business side. It is the most ethical thing you can do to ensure your business will be open for many years to serve your patients. Being the expert in your department and field makes you own a seat at the decision table with your company. It allows for ownership of future growth, expansion, clinical needs, equipment, staff, compensation, and marketing to improve and grow.
Data Points and Analytics
According to dictionary.com, analytics are the patterns and other meaningful information gathered from the analysis of data. Meaningful data are the key here. What is meaningful in an audiology world? Let’s consider some questions you may ask when thinking about your clinic.
- How many hearing tests are done daily?
- What are the age ranges of those we test?
- How many patients schedule a hearing aid evaluation?
- Who is referring patients to your practice or department?
- How many patients report tinnitus?
- How many patients follow up as recommended?
- What is charged for a hearing evaluation?
- What is reimbursed, and how long does it take?
- How many hearing aids are sold monthly, and what variety of technology?
- How many open slots are there each day across schedules?
These all are data points from which you can track and learn. These data will help you begin to understand who your patients are, what tests they receive, how you are getting paid, and who is buying hearing aids. Are your schedules filling up as needed? All these pieces of information can now help you to create future business planning.
Test Marketing and Referral Sites
Knowing who your patient base is and where they are coming from will help you to market to your largest population and areas in which you want to see improvement. Testing various types of marketing can provide information on how patients respond and where to allocate greater resources for future marketing. In addition, targeted referral marketing can be made more effective and create better relationships with outside physicians and clinics (Laberta, 2017; Hachenburg, 2008). Work with these referral sites to include audiology and hearing health-care-related articles and information that can be useful for referring patients. Marketing events in partnership with referral sites is another way to bolster the referral relationship and offer mutual patients the benefit of your expertise (Weinstein, 2016). Referral sites are crucial for any practice to thrive. Identifying sites that are strong, and those that need more support, is a requirement for success.
Business and Financial Needs
Understanding how many tests are being completed, what age ranges are served, and how the schedules are filling can begin to provide information for appropriate staffing, planning, and hiring. If schedules are at 100 percent capacity, and there is an additional 20 percent walk-in patient base, maybe it is time to consider staffing expansion. It also can help to identify if the schedules are varied and using all the services and needs of the patients, or if they are being overloaded or top heavy in diagnostics. This can lead to a discussion of who are the right personnel. Do you need another audiologist? Should you consider implementing an extern program? Do you need administrative help? A variety of patient encounters, and balance between diagnostics and hearing aids, is a necessity for any clinic to service patient needs and to create a strong and well-rounded clinic.
Lastly, understanding your hearing aid units sold by level of technology can help you to review your cost of goods with manufacturers and find trends in staffing. For example, identifying that a staff member only seems to dispense entry-level devices might suggest the need for additional training to ensure comfort with higher levels of technology. Knowing the volume of units sold and levels of technology from the hearing aid manufacturers you use can help you better prepare to negotiate your pricing and services. The better the negotiated price, the better price point you can provide to patients to be competitive. Going one step further, the selling price can be compared to area competitors to validate your pricing and let you know if you can enrich this service package and still remain cost effective (Taylor et al, 2015).
Once you understand the data associated with your practice, it can be used to set business and clinical objectives. One very simple concept every audiologist in any practice should know is the hourly break-even amount. This amount is the revenue needed each hour to cover all costs. This is calculated by totaling all the costs of running the clinic, such as, salary, cost of goods for all supplies, rent, benefits, marketing, and equipment as well as the costs per day/per hour to keep the doors open. From that basic number, future growth can be planned. Targeted growth can be planned based on what is needed and wanted for the upcoming year. Do you need new equipment? Do you need an additional staff member? Do you want monies allocated for continuing education events? If so, you have to estimate what you will need and add that to the base hourly break even, so you can plan to afford those items.
As an audiologist, why should you care about any of this? What does it have to do with being a clinician? Great question. With so many changes happening in our field, the landscape of how we provide services and what we do as experts will be challenged to grow and evolve. Understanding what your business is, who your patients are, where they are coming from, and what you need to be successful will matter in your decisions for expansion and growth. It will help to note areas to tap into, or maybe indicate areas that are not successful that need to be reviewed.
Staying relevant is staying current on the information about where the field is heading and where your practice is in the continuum of it all. We are in the day and age of evidence-based practice in what we do clinically to support why we test, how we test, what we fit, and how we recommend follow up. Audiologists need to be the voice in their own practices to determine the right direction for patient care that is sound financially for the business. Unless you become your own expert, others may make the decisions that outline how you will be practicing.
Consider what value you bring to your patient and to your practice, and leverage that information for your salary compensation, to argue for needed equipment, or to review the possibility of growing an extern program. As a clinical specialist, you want this information to validate your patient clinical success and needs. Data is the key to understanding who you are as a clinician and as a member of a larger care group. This data helps you to shape the future of your practice.
Phew. I know it is a lot of information to digest, and they didn’t teach us that in our doctorate program! There is a wealth of information and courses to help you learn more and become the master of your information. Work with your practice software systems to begin to obtain reports and analytics that give you the information you need. Learn the questions to ask to make those reports relevant. Network with mentors in practice management and analytics. The end result will be a balanced clinician with a sound business mind who is able to provide the best of both worlds: excellent patient care and a fiscally-responsible approach. Good luck!