KPIs, aka Key Performance Indicators: what are they, and how do I use them?

I love to sail

I was even so foolish as to own my own sailboat – and I quickly learned many things when sailing (besides many excellent jokes), the most important of which was the ocean rewards knowledge, preparation, maintenance of equipment; it punishes the absence of those items.

Daily weather reports, satellite images, weather patterns, prevalent wind direction for the time of year, currents, tides, electronic and paper charts, rigging and tackle all shipshape, clean, ready to go; route to destination and return reviewed and fresh in my head and instruments, crew clear on their responsibilities: as sailors say, “gentlemen only sail downwind” and I fancy myself a gentleman.

KPIs tell me if my medical practice is ready to go sailing.

Contracting, charge capture and payment posting all good? Collections on target given the time of year, the time of month? Reports, custom and canned, ready? Staff trained and working as a team, technology in place and maintained, incentives and tasks clear? Goals outlined, resources to achieve them ready to hand? Workflows working? Physician commitment and leadership rock solid?

Let me check my KPIs and compare the results against the national averages, check with my staff, make sure the IT infrastructure is up and running: ok, we’re good. Let’s turn on the phones and start seeing patients, push away from the dock. Here We Go! I’ve prepared, I’ve maintained, I’ve educated me and mine on what needs to be done: we should have a good business day and be in position to act like gentlemen, sailing downwind!

Let’s take a look at my KPI toolkit over the next series of articles, shall we? Here are 8 of my favorites:

Tool #1: Days in A/R or Turn Ratio
Tool #2: Total $ per RVU
Tool #3: Average Charge per Visit
Tool #4: Average Receipt per Visit
Tool #5: Gross Collections
Tool #6: Net Collections
Tool #7: Denial Rate
Tool #8: % of A/R by aging bucket


There are 3 types of sailors:

  1. those who have run aground
  2. those who will run aground
  3. and those who lie about it.

I ran aground in Florida, turning down the wrong channel (down there they say “an inch is as good as a mile!” because the sea bottom shelves so gradually), but because I knew I was in shallow water with a soft mud bottom, and I knew the tide was going up, and I knew my windlass was in good shape so I could kedge as the tide rose, I figured I’d be able to slip back into deeper water behind me. My wife wasn’t so sure, and there was a stretch there where I thought she might be right, but in the end we made it, safe and sound, just a little bit the worse for wear (feeling the boat lurch to a motionless halt is an uncomfortable feeling).

Now I can’t recommend running aground, mates, but when you do (cause we all do, ‘cept for them as lie about it), be prepared. Know your boat, know what the tide’s going to do, know the environment you’re in (maritime KPIs) and you stand a chance of floating again, just a little bit worse for wear: nothing a good laugh when all’s well afterwards won’t fix, chased down by a libation of your choosing, sitting just as purty as you please on the taffrail.

Let’s get a firm handle on KPIs: they help keep the boat afloat!

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Brad Sclar has founded several successful Healthcare IT companies within the last 20 years in the Denver area — PRS Network, Phasis Group, and MD-IT. In addition to multiple IT certifications he supports voice recognition software into multiple EMR environments nationwide, serves as the CIO of the PRS IT Division, overseeing template development, maintenance of client LAN installations, custom software development, HL7 interfaces between EMRs, and the installation of the Health Record portion of the EMR software packages that PRS represents. Currently, he is involved in launching a Urology focused MSO.