There are many causes, and indicators, of problems in this area. Some offices lack either a defined collection system or their collection duties are delegated among employees. In other practices, collection activities take a back seat to a myriad of other daily office activities. In larger practices, the sheer volume of revenue tends to mask certain collection inefficiencies within the billing and collection department.

Each year the National Society of Certified Healthcare Business Consultants surveys its members and compiles a Statistics Report on Medical and Dental Income and Expense Averages. This is an excellent benchmarking report you should have in your library. The report is a joint effort of the National Society of Certified Healthcare Business Consultants and the Academy of Dental CPAs. The survey includes information on overhead percentages, average monthly charges in accounts receivable, full time equivalent staff ratios, and more. 

The 2009 Joint Statistics Report Based on 2008 Data features data from over 2,800 professional practices representing over 5,800 FTE doctors. The following is a list of specialties in the survey. To order the survey and to see the medical (and dental) specialties represented, go to

http://www.nschbc.org/statistics/index.cfm.

Many physician practices are organized as S corporations. One main reason is that money can be taken out of the corporation as compensation and dividends (distributions). While compensation is subject to employment taxes, the distributions are not. This Watson case makes us think about how physicians pull money out of their own S corporation.

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