From the Field: Stop Throwing Away Your Money, Part 2

Rick Collins

In the last issue of Nephrology Times I addressed two common ways in which healthcare providers spend money needlessly. The first was employing management personnel with no financial training and the second was contracting with incompetent vendors. While incompetent managers and vendors may be giving an honest effort, there are, unfortunately, managers and vendors that are intentionally dishonest and manipulative. Getting rid of such people is vital to the success of your practice or facility.

Dishonest Practice or Facility Managers

I am truly disgusted by those who intentionally lie and deceive in order to gain more power and control over a practice, its employees, and its finances. I cannot emphasize enough that if you have someone in a position of authority with whom you are romantically involved, it is absolutely essential to have a competent and neutral third party watch over your money and the management of your practice or facility. The same is true for a relative, including your spouse. Because my company is hired as a third party to provide billing services, we often find out what is really happening behind the doctor’s back. Following is a small example from my experiences with past clients.

In one instance, a manager of a large facility consistently failed to carry out simple and critical tasks such as signing payer contracts, depositing paper checks, filing reports on time, and seeing that medical records were kept up to date. The manager’s failures resulted in loss of revenue, penalties, confusion, and the loss of good employees. The facility was at great risk in the event of an audit or a survey.

However, when our staff tried to communicate some of the problems to the owner, the owner simply spoke with the manager, who lied and blamed others. The manager then became more hostile and less cooperative with us because we had politely dared to mention some of the problems we had noticed. What was the manager’s motive? The lack of financial controls left open the possibility that funds were being embezzled. The manager also had significant freedoms in making purchases and no one was in place to oversee the manager’s spending and verify that funds were actually spent on what was claimed. To further cement control, the manager hired friends and placed them in key positions. These “friends” would back up the manager in the lies and deception, which caused the owner to think that others were causing the problems.

I am happy to report that the manager was finally replaced, but only after many years of deception that caused the facility and its owner, employees, and patients to suffer unnecessary consequences.

Dishonest or Unethical Vendors

In general, vendors who participate actively in the renal industry cannot afford to be dishonest. Word normally spreads quickly throughout our relatively small industry about how someone was cheated or mistreated. However, vendors not associated with the renal industry may try to take advantage of providers—accountants, attorneys, bookkeepers, landlords, financial planners, consultants, insurance vendors, computer and network sales and service personnel, phone and internet vendors, along with those that work in construction, remodeling, flooring, roofing, plumbing, heating and air conditioning, and on and on and on. Healthcare providers are prime targets for the dishonest because the widespread belief is that all providers are rich and are not careful with expenditures.

There are several things you can do before you contract with a vendor that can save you a lot of grief in the long run. The first is to obtain effective references. Recently, after I sent a list of three references to a prospective client, the prospect then asked me for references from three former clients and three current clients that were different from the three on the list I sent previously. In this way, my prospect was able to obtain a more complete picture of what our company is really like.

Another great source of references is a message board, which is normally run by associations with which you are affiliated. Write a quick post that names the type of service you are looking for and you will likely be amazed at the helpful feedback you receive from others.

If you are already contracted with a vendor you suspect may not be providing you adequate services or products at a fair price, contact others in the renal industry and ask how much they pay for similar services. Knowledge is your friend and you can make reasonable demands on your current vendors based on the feedback you receive from others.

Rick Collins is the director of business development for Sceptre Management Solutions, LLC., a company specializing in billing for outpatient ESRD facilities, nephrology practices, and vascular access. Your questions are welcome and he can be reached at rcollins@sceptremanagement.com or 801.775.8010.