Record inflation and a worsening healthcare workforce shortage are driving the operational costs of medical practices through the roof and physicians’ margins to the floor. So it’s not hard to imagine how much of a blow the recent Medicare pay cuts have on physicians’ revenue and income.
However, all hope is not lost. In this blog, we’ll explore how you can cushion the impact of the Medicare pay cuts, maintain a steady cash flow, and improve your practice’s financial stability.
In November 2022, the Centers for Medicare and Medicaid Services (CMS) released the Physician Fee Schedule (PFS) final rule for calendar year (CY) 2023. The update includes a new conversion factor (the amount Medicare pays providers for every relative value unit under the final physician fee schedule) that slashes the rate from $34.6062 to $33.0607. That translates to a 4.5% reduction in the CMS physician fee schedule.
Combine that with multiple other factors like the expiration of the 3% evaluation and management (E/M) bonus, the new 1.5% E/M budget-neutrality adjustment, and the 4% pay-as-you-go (PAYGO) cuts, and physicians face as much as 8.5% revenue reduction.
In response to the pay cut, the American Medical Association (AMA) and several other physician advocacy groups petitioned congress for a reprieve through what is now known as the “dear colleague” letter.
Although their collective efforts successfully brought the supposed 8.5% pay cut down to 2%, physicians are not entirely out of the woods yet. The Biden administration hints at another round of pay cuts in 2024, adding another layer of burden to physicians’ financial woes.
As one financial challenge piles on top of another, you must implement measures to maximize revenue and ensure your practice’s economic viability in 2023 and beyond.
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Maximize Revenue With billrMD’s Insurance Payment Tracking Software
One of the most effective strategies for managing the impact of pay cuts is to streamline your billing process. This is where medical billing software solutions like billrMD come into play.
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How to Choose a Medical Billing Software in 2023
A billing software system can significantly reduce the time and effort spent on billing-related activities by automating essential tasks such as claims submissions, coding, and payment collections. It also ensures that your claims are submitted accurately and on time, increasing the chances of timely payment and reducing denied claims.
In addition, medical billing software can provide valuable insights into your practice’s financial performance, enabling you to make informed decisions that can help improve your bottom line. You can track key metrics like revenue, claims aging, patient collections, and other key performance indicators (KPIs) that allow you to identify areas of weakness and proactively address them.
Another way to cushion the impact of the Medicare pay cut is to diversify your revenue streams. You can achieve this by offering additional services that complement your core offerings, such as telemedicine consultations and diagnostic tests. Doing so can increase your practice’s overall revenue, reducing your Medicare reimbursement dependence.
Healthcare providers often get a bad rap for their slow adoption of technological advancements for their practice’s billing and administrative needs. But in most cases, it’s not because they refuse to embrace innovation—most software systems in the market are simply out of reach, especially for small and start-up practices.
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Why billrMD is the Best Software For Your Small Medical Practice
That’s why free medical billing software solutions like billrMD play a crucial role during these financially turbulent times. They provide small practices an accessible entry point into sophisticated technology solutions at no cost.
As a
web-based medical billing software, billrMD offers the most comprehensive set of practice management and medical billing tools for
medical practices,
billing companies,
laboratories, and diagnostic testing facilities. With features that cater to the unique needs of different facilities in the healthcare continuum, you and your partner organizations can use the same platform for enhanced coordination and streamlined workflows.
Designed with scalability in mind, billrMD offers
flexible packages that allow you to unlock more premium features as your practice grows. With the Medicare pay cut, a looming recession, skyrocketing labor costs, and a host of other financial challenges, you need affordable medical billing software that allows you to grow at your own pace.
