Does EHR Help or Hurt Doctors Wanting to Stay Independent?

I’ve been hearing more and more people talk about the challenges that small independent doctors are having in this ever changing healthcare environment. In fact, I’ve heard a number of people proclaim the death of the small physician practice. I’m not ready to carve the gravestone of small practices, but there’s little doubt that the small physician practice is facing a lot of challenges from a lot of different angles.

athenahealth recently did a profile of whe Wilson Stream Family Practice’s challenge to stay independent. It’s a common case that many of us have no doubt seen. Although, what I found really interesting in the profile was they made the case that athenaCollector and athenaClinicals was key to them staying an independent practice. It’s only a two page profile, so check it out to see what I mean.

I found this a really interesting topic of discussion. Does an EHR help a practice stay independent?

As usual, the answer is that it depends. A poorly implemented EHR can put an independent practice out of business. However, the opposite can also be true. I’ve seen a well implemented EHR help a lot of practices get the business of their practice in order. I think an EHR will become even more valuable to an independent practice as the billing and coding rule complexity continues to increase.

One aspect of that reimbursement complexity revolves around the move to accountable care. Many indepents are selling off to hospitals in anticipation of this change, but there is a case to be made for Clinical Integration with your hospital system as opposed to a full on physician acquisition. However, a practice without an EHR won’t have the clinical integration option available to them. A hospital won’t be clinically integrating with a paper practice.

We’ll see what other forces start pressing down on doctors, but an EHR will be a required part of practicing medicine whether your practice remains independent or is acquired by a hospital.

About the author

John Lynn

John Lynn

John Lynn is the Founder of the, a network of leading Healthcare IT resources. The flagship blog, Healthcare IT Today, contains over 13,000 articles with over half of the articles written by John. These EMR and Healthcare IT related articles have been viewed over 20 million times.

John manages Healthcare IT Central, the leading career Health IT job board. He also organizes the first of its kind conference and community focused on healthcare marketing, Healthcare and IT Marketing Conference, and a healthcare IT conference,, focused on practical healthcare IT innovation. John is an advisor to multiple healthcare IT companies. John is highly involved in social media, and in addition to his blogs can be found on Twitter: @techguy.


  • As the focus of this article is on the effect of the EHR on an independent practice, the focus of too many doctors is unfortunately on their choice of an EHR which sometimes is at the expense of careful consideration of the practice management software that the practice depends upon. In some instances their choice of EHR comes with a “partnership” with a billing service that takes a percentage of collections but accepts no responsibility for expenses.
    In my experience of 30 years of practice management consulting, for the most part only a very poorly managed independent practice benefits from a billing service versus doing their own billing. Using software supplied by a billing service to the practice is great for the billing service, because the office staff is now performing all the data entry for the billing service. The billing service costs are dramatically reduced, so the percentage of collections charged by the service should also be reduced. In fairness, using a billing services’s software can in theory mean they can review documentation to make sure it supports the coding, if the doctor and the service feel comfortable with billing personnel not employed by the doctor see the EHR entry.
    I have yet to observe a small practice that has reduced staff when they contracted with a billing service, nor have I seen a small practice that moves away from a billing service need to add staff. Using a billing service does not replace the need for staff to enter patient data, collect insurance information, scan an insurance card, schedule appointments, post charges, etc. Only in an instance in which the practice is large enough to have one or more employees who are dedicated to following up on claims that do not get paid without follow up, which is a very small percentage of claims in most practices, would there be any change in staff requirements.
    When doctors have felt their office could do better with help, my recommendation has been that they first make sure they are using every billing and collections tool presently available to them to maximize their income and also that they of course thoroughly examine their expenses. If they are not good managers, and it is understandable as they are likely to have had little or no training in this area, they should consider working with their regional consultant/trainer for their software, who at least in our case frequently has 25 or more years of experience in hundreds of practices in their area. Using that resource can result in more thorough hands on training and more efficient use of the software that runs their practice.
    Practice owners should make sure that all providers review daily productivity reports for accuracy (to be certain that every service provided has been billed and billed correctly) and that the practice owner(s) reviews daily collection and deposits (to make sure that there is no funny business at the front desk for one thing). A billing service cannot help with daily oversights in the data entry nor can they prevent theft or theft or sloppiness at the front desk.
    Doctors need to understand patient and insurance receivables reports and make sure that their staff is working them on a regular basis to continuously improve what is collected without the need follow up. If a doctor retains a billing service, he must monitor those same reports to make sure the billing service is doing as good a job or a better job. He has even less control over employees of the service that he has never met and does not directly supervise.
    There are so many things every small practice can do to be more effective with their billing. For example, if they are printing monthly statements, are they making it as easy as possible for the patient to pay by using preprinted forms that are perforated? Are they sending a pre-stuffed, pre-stamped reply envelope? If they accept credit cards, do they have a cc authorization on their statements? Are they using billing cycles, for example weekly, to get statements out to patients more promptly? Once their statements have been printed, do they have a part time employee that stuffs and gets them out the door within a day, or do the statements sit around for a week until some of them are inaccurate and unnecessary? Have they considered sending statements electronically to a service that, for a few cents per statement over their postage and paper costs, verifies the billing addresses, guarantees 24-hour turnaround, allowing office staff to focus on posting properly, collecting up front, and following up on patient and insurance collections? Have they considered using a revenue cycle management tool (collections) like TransWorld that integrates with their software to encourage their overdue guarantors to pay before they get to the point of collections with a gradually escalating series of notes and letters?
    There so many areas in which every practice can be more efficient. If they don’t know what these areas are, they can invest in the services of a trusted consultant to help identify them and train their long time staff to be more productive. In some instances they could use a billing service/consultant that works with the practice’s own software and database either remotely or by coming on site regularly. This strategy empowers the practice because they retain complete control, and it keeps pressure on the service/consultant to provide a continuing benefit to them because on the day the doctor does not perceive a sufficient benefit from the consultant/service, he can terminate the service with absolutely no disruption.
    As far as insurance submission, the practice needs to make sure that their software is efficient. For example, does it error check claims? Can staff easily check eligibility before seeing a patient? Do they use a service from the clearinghouse that performs claims “scrubbing” before submission? Can they submit eclaims from any terminal over the Internet? Do they have an eclaims manager in the software that interacts electronically with a clearinghouse report and then a carrier report and automatically changes the status of claims and records the reasons for denial? Can they easily see the claims denied as a separate group? Can they easily “drill down” to get back to the ledger on a claim to make a change for resubmission? Do they have easy access to a portal at their clearinghouse, and can they easily track claims, resubmit, and produce a timely filing letter? Has the doctor invested in the portal service and in training the staff to use these tools? When the staff receives payments, are they using ERA (Electronic Remittance Advice) for every carrier for which it is available to them to eliminate data entry errors and hours of time spent posting bulk checks. Is the staff reviewing payments and appealing for more money from the carriers?
    In my opinion and in my experience, there are many, many improvements that a doctor can make to retain profitability and viability in his private practice. I hope that the suggestions I have made will encourage some independent practitioners to stay independent by focusing on what is happening at their front desk and in the billing office as well as in the exam room.
    In the near future, I believe that the specificity of ICD-10 coding will tie the doctor much more closely to his administrative staff than ever before, and handled properly, that could be the salvation of many practices (an unintentional byproduct for sure). Independent offices that have true teamwork between clinical and administrative staff all focused on the most effective and efficient delivery of the best care to their patients are a pleasure for everyone involved.
    I am sure I speak for other privately owned practice management and clinical software developers, when I say that we are primarily in business to support the success of doctors who own independent practices, and that your success is a measure of our success.

    Mark Hollis
    MacPractice, Inc., CEO

  • It’s a healthy revenue cycle that allows small practices to maintain independence and autonomy. Integrated EHR/PM, as in the case of the athenahealth client, is just a means to that end.

    Practices don’t need integrated systems to maximize practice efficiencies. Disparate EHR/PM software connected by tight operational systems can do the same, while offering a level of flexibility an integrated system cannot provide.

    The success of both disparate and integrated models depends on the resources practices have to assist with the development and maintenance of optimal and tight systems required to keep small practices profitable. Those without such resources stand to gain significantly from firms that offer support in the realms of EHR/PM/RCM.

  • Mark Hollis,
    “only a very poorly managed independent practice benefits from a billing service versus doing their own billing.”

    Which explains why so many are turning to a billing service. In fact the complexity of your explanation of the details of how to make your independent practice function well is why many doctors are turning to billing services. They want to offload some of that burden. Plus, in many ways the billing service holds them accountable for the questions you ask.

    As a side note, your comment would have made a great guest post. I may convert it to a post if you’re ok with that.

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