What is Benchmarking?

Benchmarking is the process of identifying specific reference points for your business to measure performance, efficiency and quality. It can be used in many different ways, though it ultimately comes down to seeing how you stack up against your peers and against your own past performance. It is through benchmarking that practices can also better understand areas for improvement and find ways to offer a wider range of services, as well as improve profitability.

Internal vs. External

External benchmarking compares your practice against the performance of others in your industry and/or specialty. External benchmarking can offer a window into general competitor performance as a way of seeing how effectively others perform similar tasks. Through external benchmarking, practices can see not only how they stack up, but also where they specifically fall short.

Information is Critical

To streamline the process of collecting information, remember that internal and external benchmarking are driven by the same data sets. Many practices might start off by contacting trade organizations or specialty associations (i.e. the American Medical Association) for existing benchmark data by region, specialty, practice size, etc. There is, in fact, so much information available from these types of industry groups for just a few hundred dollars that most of the work will already be done for you. Simply take a look at what others are measuring, how they are doing so, how they formulate their results, and work out from there. A few hours setting up a basic spreadsheet will help you maintain clean records and manage effective, albeit simple, comparisons. This will at least get you started and identify target areas where you might need to become more aggressive over time.

An additional thought on purchasing existing data: Industry-wide benchmarking is based on median figures and industry averages. Make sure you understand what type of information you are buying ? whether it?s industry-wide, or industry leaders. If your goal is to become a top performing practice and your objective is to meet industry-wide benchmarks, you are only setting your sights on mediocrity.

Openness to Change

As you move through the benchmarking process don?t lose sight of the ultimate goal- affecting a positive change on your medical practice to improve your services and your practice?s profitability. Benchmarking is not just about identifying where you currently stand, but finding ways in which you can do better. It?s about evolution, growth, and change. Keep an open mind and be flexible when your results suggest that something you?ve done for years might just be the reason you?re not performing well.

For more information on improving your health care practice, as well as your medical insurance billing, contact Diversity Medical Billing Services. Diversity is a leading provider of Medical Claim Billing Services, helping practices across the US find increased reimbursements. You can also check out more Medical Billing Articles and Tools in their medical billing knowledge center.

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