Overview

Our goal is to provide timely and specialty-specific market data for certain key operational metrics, together with best-practices suggestions, so that users can better evaluate and improve the efficiency, productivity, and financial performance of their medical practices.

Data Period and Scope

The data used in PracticeVitals are based on actual physician activity captured by athenahealth in the course of providing our services. In order to be considered for inclusion in the data set for a particular metric, data must come from a practice with a sufficient track record on our systems.

Sufficient Track Record. Because PracticeVitals includes a one-year trailing monthly performance graph for each metric, we have sought to maintain a consistent sample pool throughout this one-year period (apples to apples, right?). We therefore require a practice to have been using our services for that entire year—plus another three months to control for potentially skewed data from practices just transitioning to our services—to be considered for inclusion in the data set.

Eliminating Spurious Data.To control for statistically anomalous data that could materially skew average practice performance, all figures shown are median values. This means that, for the specialty selected, half the providers are above the median and half are below the median. This approach provides a stable estimate of 'typical' levels for the specialty chosen.

If a practice specialty is selected in the tool, data for practices with that specialty will be used unless the sample pool for that specialty is too small to be meaningful. If there aren’t at least thirty practices in a specialty with qualifying data for a particular metric, then the sample pool will be broadened to include all practices with qualifying data for that metric. If a specialty is selected, an asterisk will be displayed by any metric that uses data from all practices in order to indicate that the metric is not specialty-specific.

Unless otherwise specified, each metric represents the median statistic across all practices included in the data set for that metric.

Metrics

The data described above are used to calculate the results in each of the following categories:

No-Show Rate

No-Show Rate is calculated by dividing (1) a practice’s total number of appointments cancelled with a “Patient no-show” reason during the month in question by (2) the total number of appointments scheduled for the same month for that practice.

Revenue Resolution Rate

Revenue Resolution Rate is calculated by (1) dividing (a) the difference between a practice’s total charges posted and its net receivables for the month in question by (b) the total charges posted by that practice for that month and (2) subtracting the result from 100%.

Days in Accounts Receivable

Days in Accounts Receivable (DAR) is calculated by dividing (1) the average of a practice’s accounts receivable over the last seven days of the month in question by (2) the 60-day rolling average of the daily total fee-for-service charges generated by that practice, averaged over each of the last seven days of that month.

Turn Around Time

Turn Around Time is the average number of days between the date each particular service is provided by a practice during the month in question and the date the related claim is entered into athenaNet.

Same-Day Close Rate

Same-Day Close Rate is calculated by dividing (1) the number of a practice’s checked-in appointments during the month in question that are closed on the date of service by (2) the total number of checked-in appointments for that practice for that month. Checked-in appointments that involve only diagnostic tests using practice equipment are excluded.

Delegation of Work

Delegation of Work is calculated by dividing (1) the number of minutes spent on intake documentation by a practice’s non-provider staff during the month in question by (2) the number of minutes spent on intake documentation by that practice’s non-provider staff and providers during that month. Intake documentation time for encounters handled other than by a rendering provider or non-provider staff or with an elapsed time between the start of check-in and final sign-off of six hours or more is excluded.

Revenue Calculator

OVERVIEW

Our goal is to provide users with a brief and simple illustration of a few of the ways that athenahealth, Inc. can help to improve a medical practice's bottom line.

DATA PERIOD AND SCOPE

The data used in this Calculator are based on actual physician activity captured by athenahealth in the course of providing our services, surveys we've taken of vendors, and third-party research published by iData Research Inc. (U.S. Market for Electronic Medical Records, December 2009) and the U.S. Department of Labor, Bureau of Labor Statistics (Occupational Employment and Wages--May 2009, May 2010). The following provides a summary of the data used:

Average Annual Chart Pull Savings: The average annual savings per physician in chart-pull labor costs due to EMR adoption. Source: iData Research (2008)

Average Monthly Collections: The average monthly collections per provider, by specialty. Source: athenahealth data (Q3 2011)

Average Monthly Label Cost: The average price per provider for printed labels used to identify clinical documents faxed to athenahealth during one month. Source: athenahealth data (September 2010), athenahealth vendor survey (October 2010)

Average Monthly Labor Cost: An estimate of the average monthly labor cost per provider for a medical records technician to process a practice’s internal documents for delivery to athenahealth. Source: athenahealth data (September 2010), U.S. Dept. of Labor (Year ended may 2009)

Average Monthly Printer Cost: The average price for a label printer, amortized over a year. Source: athenahealth vendor survey (October 2010)

Average Monthly Visits: The average monthly number of patient visits per provider, by specialty. Source: athenahealth data (Q3 2011)

Medicare Part B Percentage: The average percentage of collections that are received by practices under Medicare Part B, by specialty. Source: athenahealth data (Year to date as of 11/23/2011)

Pre-athena No-show Rate: The average percentage of patients who do not show for appointments for practices that are not live on athenaCommunicator®. Source: athenahealth data (Year ended 8/2011)

Storage & Management Cost Savings: The average annual practice savings in storage space and archive management costs due to EMR adoption, based on the number of practice physicians. Source: iData Research (2008)

ASSUMPTIONS

In developing this Calculator, we relied on our experience with our clients in assuming that a practice will generally have one label printer for every three providers and that a medical records technician will take between one and two minutes to prepare and send an internal document of the practice to athenahealth (documents from third parties are faxed directly to athenahealth without any action required on the part of the practice). We have also assumed that a practice's providers are all eligible ambulatory health care providers and therefore qualify for HITECH Act incentives. CALCULATIONS

The data and assumptions provided above are used to calculate the results in each of the following categories:

Increase Collections: To determine the estimated increase in monthly collections due to use of athenaCollector®, the Average Monthly Collections   for a practice of the selected specialty (a per-provider average) is multiplied by the specified number of practice providers to estimate total practice monthly collections. This number is presented to the user during the initial questions as the default, but it, like the other defaults in the Calculator, may be changed by the user. The entered practice monthly collections is then multiplied by the entered percentage increase in collections. 12% is offered as the default for the percentage increase in collections because that is the average increase for our clients, based on a weighted average for athenahealth clients with valid pre-athenahealth benchmark data that had their 15-month anniversary with athenahealth during 2010. /p>

Increase Patient Volume: To determine the estimated increase in patient volume due to use of athenaClinicals®, the Average Monthly Visits   for a practice of the selected specialty (a per-provider average) is multiplied by the specified number of practice providers to estimate the practice's total number of monthly visits. This number is presented to the user during the initial questions as the default, but it, like the other defaults in the Calculator, may be changed by the user. The entered number of monthly visits is then multiplied by the entered percentage increase in patient volume to get the estimated number of additional visits each month for the practice. 3.8% is offered as the default for the percentage increase in patient volume, because that is the average increase for our clients, based on a comparison of the average change in patient visits for clients without athenaClinicals with that for clients that had their six-month anniversary on the service during the year ended November 2009.

The estimated number of additional visits each month is then monetized by dividing the entered practice monthly collections by the entered number of monthly visits, which gives average per-visit collections, and then multiplying that by the estimated number of additional visits.

Reduce No-Shows: To determine the number of additional visits each month due to use of athenaCommunicator, the entered number of monthly visits (as described in Increase Patient Volume) is multiplied by the Pre-athena No-show Rate   and then the expected percentage improvement in the no-show rate. 16% is offered as the default for the percentage improvement in the no-show rate, because our clients have seen at least that percentage of improvement, based on a comparison of the highest no-show rate among clients with athenaCommunicator® and the average rate for appointments without the service for the year ending August 2011.

The expected number of additional visits each month is then monetized by the same method set forth in Increase Patient Volume.

Qualification for HITECH Act Incentives: For 2011, the HITECH Act authorizes payments to each Medicare provider equal to the lesser of $18,000 or 75% of that provider's total Medicare payments for the year. To determine a provider's expected total Medicare payments for the year, the entered practice monthly collections is divided by the specified number of providers to obtain a per-provider average. This average and the Medicare Part B Percentage   for a practice of the selected specialty are then multiplied and annualized. The lesser of $18,000 or 75% of the average provider's total Medicare payments for the year is then multiplied by the selected number of practice providers to determine the practice's total payments for 2011 under the HITECH Act in regard to Medicare.

Qualification for PQRI: To determine the monthly payment for participation in PQRI, the entered practice monthly collections (as described in Increase Collections) is multiplied by the Medicare Part B Percentage   and then by CMS's average PQRS incentive payment rate (which is 1%).

Qualification for e-Rx: To determine the monthly payment for participation in e-Rx, the entered practice monthly collections (as described in Increase Collections) is multiplied by the Medicare Part B Percentage and then by CMS's e-Rx incentive payment rate (which is 1%).

NOTE: If a provider is eligible and opts to receive HITECH incentives, that provider does not qualify for e-Rx incentives per the HITECH Act rules. The Calculator will exclude e-Rx incentives if the user indicates that HITECH Act incentives are to be included.

Document Services Cost Savings: As a rough estimate of the monthly document services cost savings from use of athenaClinicals, the Average Annual Chart Pull Savings   (a per-physician average) is multiplied by the specified number of practice providers and then added to the Storage & Management Cost Savings   for a practice of the specified number of providers (since the iData Research data underlying this calculation are based on the number of practice physicians, the specified number of practice providers is used as a proxy for purposes of this calculation). This number is then divided by twelve to obtain a monthly average document services cost savings.

In an effort to represent the athenaClinicals cost savings fairly, we then make sure to back out an estimate of the document services expenditures incurred in the use of athenaClinicals. To do this, we subtract the following from the monthly average cost savings: (1) the Average Monthly Printer Cost,  multiplied by the specified number of practice providers and then divided by three (i.e., the assumed number of providers per label printer); (2) the Average Monthly Label Cost   (a per-provider average), multiplied by the specified number of practice providers; and (3) the Average Monthly Labor Cost   (a per-provider average), multiplied by the specified number of practice providers.

As background, the average monthly costs used in this calculation are determined as follows. Average Monthly Printer Cost   is based on our market research of the going price of suitable label printers, and the average cost of such printers is then divided by twelve to obtain the monthly expenditure (note that this is only an expense in the first year). Average Monthly Label Cost   is based on the average number of bar-code-labeled clinical documents that Athena receives from each athenaClinicals client in a month, multiplied by the average cost of a single label (as determined through our market research). Average Monthly Labor Cost   is based on our understanding of the time taken to label a practice's internal clinical document (converted to an hourly fraction), multiplied by the average number of such documents that we receive per month from each athenaClinicals client, and then multiplied by the 2009 median U.S. hourly wage for medical record technicians (i.e., $15.04).