I am so proud of the GrowthMD team for their amazing dedication and care for our clients in 2020. Let's recap some high-points.

Five topics on the radar of medical practices in January 2021.

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Every day I feel honoured to work with such a range of diverse and accomplished clients in my role at GrowthMD. So of course, I was over the moon to learn that Dr Dinesh Palipana OAM is the Qld nominee for Australian of the year 2021. Congratulations on your hard work and persistence Dinesh. The impact you create continually inspires the team here.

We have been overwhelmed by how you, our amazing clients and partners, have embraced the launch of GrowthPilot. Thank you – it has been nothing short of amazing. However, we have ruffled some feathers and our business name has garnered some attention in the marketplace. In light of this, we have taken an opportunity to makeover our image – with a new name that illustrates our 100% commitment to medical and dental practices and family businesses in Australia. GrowthMD Pty Ltd Same people, same vision, a cooler website, a new logo and a clearer message about who we work with and why our clients have chosen us.

This week the Royal Australian College of General Practitioners released General Practice: Health of the Nation 2018 Report. The report covers an array of topics and some of these are inherently linked to finance and accounting within General Practice (which is what we specialise in at GrowthMD). Below we discuss seven findings with finance relevance from the report. 1. “There is a positive relationship between overall job satisfaction and remuneration. GPs who indicate that they are very satisfied ‘taking everything into consideration’ earn more per hour than GPs who are very dissatisfied” There is no surprise in the fact that remuneration is somewhat linked to satisfaction levels.  Interestingly though, this is the issue where GPs are most dissatisfied with their role. From a practice perspective, it then follows that savvy owners and practice managers will be on the front foot when it comes to GP remuneration – actively helping their GPs understand financial metrics, benchmarks and impacts of their billing patterns on remuneration.  This help does not have to come in the form of stringent targets or at the cost of patient care – the focus is on empowering GPs to control their remuneration through an understanding of financial drivers. This will benefit the individual GP and the practice – more satisfied GPs, improved retention, and potentially increased revenues for both the GP and the practice. 2.“Overall 52% of GPs reported that they are able to maintain a good work-life balance” Great news for 52%. However, let’s take a minute to focus on the remaining 48% – which equates to over 17,000 individuals if we apply these survey results to the 36,000 Australian GPs. Obviously, billing and rebate pressures, increased patient need and shortages of GPs in many locations have placed extra stress on GP working arrangements – but to hear around half of GPs feel they do not have a good work-life balance is concerning.  Whilst this is a broader issue with complex drivers, there are some areas where taking a finance focus can help. Working long hours but feeling like your financial health is going nowhere is a commonly expressed pain point when we meet with new clients.  To begin with, identifying your financial aspirations and the point where you stop working to ‘meet expenses’ and start working to ‘create wealth’, will empower you to make informed decisions on where your optimal work-life balance sits. 3.“82% of GPs are remunerated on a proportion of billings basis” There is no surprise in this statistic, however, it does highlight some important issues that need to be kept front of mind for practice owners and managers. Practices and GPs need to ensure appropriate structures and agreements are in place to properly administer a business relationship based on this remuneration method. Lack of effective planning, structuring and record-keeping can have legal and taxation implications. Practices need watertight systems and processes to handle the correct collection and proportionate split of doctor earnings. Practices collecting on behalf of GP providers have a duty to the GP in relation to accuracy, compliance and documentation.  At GrowthPilot we feel very strongly about this issue – see Is your medical practice making these financial mistakes? Fully trained GPs engaging as practice employees is a relatively rare scenario and practices should seek guidance on the tax and compliance effectiveness of these arrangements. 4.“More than half (55%) of GPS have no interest in owning a practice in the future” This suggests that some GPs are moving away from the traditional career aspiration of practice ownership.  With more GPs not tied through ownership to a physical practice location, could we see a more fluid workforce or more local movement from practice to practice than we have seen previously?   If so, GP retention has never been more important. GP retention is a long-term profit driver and success factor in a GP practice (see Retain your practice GPs for long term profit).  Therefore, taking the time to understand the interests and career goals of your GPs is crucial.  It is probable that the career motivators of a younger GP workforce are vastly different than that of a more senior practice owner. 5.“62% of practices employee allied health professionals in their main practice” Multi-faceted practices boasting a variety of staff can have benefits not only from a collaborative patient care perspective but also from a financial perspective.  Leveraging team members in a range of patient care and value-adding initiatives can diversify income streams and free up GPs for direct patient-related care.  The key here is in knowing the value each team member is adding on an operational, financial and patient delivery level i.e. are they providing direct or indirect value, what is their cost to the business or even their service breakeven point? 6.“Half of GPs felt comfortable experimenting with new technology, with a further 35% liking the use of technology but needing more training on its use” Many non-owner GPs are not given enough credit in their willingness to test and implement technology into their daily work life.  Practice managers (and some practice owners) are usually the drivers in the introduction of technology and should encourage training and ongoing support to individual GPs in this area.  Early adopters of technology in General Practices will be better placed to deliver efficient and financially beneficial services in the future as tech solutions and tools evolve. Don’t dismiss the concept of performing a “technology audit” in your practice to identify areas of need or where small tasks could be automated.  While General Practice will always need good quality GPs and staff offering a human touch, technology should be used as a time saving bolster. 7. “There are over 6,300 accredited GP practices in Australia in 2018” If we assumed each of these practices was billing an average of approximately $2.2M in annual gross billings to patients we are looking at an approximate $14 billion pool of income. This pool of income represents a massive amount of receipts and payments, data reconciliation and taxation compliance being completed daily.  Accounting for general practice and individual GPs is a specialised area and should be performed by experienced professionals with knowledge of relevant taxation legislation, the Australian health system and relevant practice technology and systems. Looking after the finance function for General Practice is not just for specialist accountants alone – it is ideally a partnership between practice managers, owners and accountants in order to find a streamlined, efficient and compliant system that works for all parties. *Infographics within this article have been taken directly from the report available at: https://www.racgp.org.au/download/Documents/Publications/Health-of-the-Nation-2018-Report.pdf

Whilst I was on vacation this week I took some time to reread the changes to the Health and Medicare compliance measures which began on 1st July 2018. While reading through the material I was struck by the similarity between the ATO compliance and debt program and these new measures aimed at Health Practitioners. I found myself wondering if the policymakers in the Health Department may have taken their lead from their government colleagues at the ATO when forming these legislation changes. Here is a brief look at the similarities between the Department of Health and the ATO compliance and debt program.  (The Health Legislation Amendment (Improved Medicare Compliance and Other Measures) Bill 2018 came into effect on 1st July 2018). Applicable to Health Practitioners (can include GPs, medical specialists, dentists, pharmacists and allied health providers)Applicable to Australian Taxpayers Garnishee Powers Garnishee notices can be issued in relation to debts, allowing the recovery of funds from a provider’s bank account. Garnishee notices can be issued to 3rd parties such as banks or employers to recover tax debts. Record Keeping Practitioners are required to keep claim and supporting records for at least two years (and up to four years for some dental and other programs). Taxpayers are required to keep records for up to 5 years Substantiation Practitioners must substantiate item numbers claimed if requested by the Department (Notice to Produce Documents). Taxpayers must substantiate their claims if requested by the ATO.PenaltiesAdministrative penalties are applied to debts arising from a failure to substantiate claims. These can be reduced if t Shared Debt Recovery Scheme (SDRS) – from 1 July 2019 As we know, at present an individual medical practitioner is solely responsible for a Medicare debt (except in cases of fraud by associated parties). The application of the Shared Debt Recovery Scheme from 1st July 2019 provides that, where contractual or other arrangements exist between a practitioner and an employer or corporate entity, both may be liable for the repayment of a debt arising from a false or misleading claim. Of course, one of the outcomes of this scheme is that health practices and corporations should be proactive in taking a higher level of responsibility and interest in billing accuracy, as they may now share some responsibility for liability with the health practitioner.  It could be viewed that one of the drivers behind the SDRS is for health practices, employers and corporate entities to help monitor and police compliance by the individual provider. To me, this is reminiscent of the ATO’s approach with ABN withholding provisions where the contracting party is used in a compliance measure to promote compliance at an individual contractor level (such as a business paying a contract tradesman to complete repair work on their premises). Measures such as the above, where compliance is aided by associated and often unrelated parties have been ATO policy for several years now and continue to evolve and expand. What’s next? The Federal budget delivered in May 2018 allocated a massive $130 million in new funding for ATO compliance activities. The same budget also promised funding, although much less, into compliance and debt recovery measures to target investigations into fraud, inappropriate billing practices and incorrect claiming under the Medicare system. Personally, I have seen a flurry of activity in the ATO compliance and review space. The increased activity includes expense claim reviews and the expansion of “dob in a tax cheat” type telephone and online systems. Tax agents who administer many claims on behalf of taxpayers are also in the firing line for increased compliance activity. Is it only a matter of time before we see a similar flurry of activity in Medicare compliance, including the wider promotion of anonymous reporting measures for fraudulent claiming? Is there the potential that billing agents and practice management staff may one day become subject to a compliance scheme such as the Tax Agents Board which monitors tax practitioners (including competence criteria and registration to be able to make a claim on a provider’s behalf)? Time will tell, but the increased compliance in Health and Medicare is an interesting space reminiscent (to me) of the ATO rulebook.

Some see their role as an accountant in a narrow frame - compute tax, lodge return, claim GST. Repeat. I like to view our contribution on a larger scale and with purpose. In my world, I work with many medical practices. Through this work, I believe I can make an impact. I can help your business be more profitable and cash flow positive. I can reduce your financial stress. I can give you the tools to free up your time and your team’s time. Which means you can focus on patients, or you can focus on family and friends. Your health and relationships improve. Maybe you can go on that holiday you have been putting off. With more time, your team is happier. Maybe the family is more comfortable. A happy team can focus on satisfied patients. More satisfied patients are more likely to return - impacting their health outcomes and your business success. Which means you can give back to your community or those in need. You can keep people employed and financially independent. Some may find this ridiculous or too touchy-feely for accountants. I think it is what we should all aspire also. As skilled and passionate accountants, we can make differences that flow on to significant impacts. Let's talk about how GrowthMD can help you book a discovery call. https://calendly.com/kellychard/15

I talk through the process of why you may want to change your accounting firm and how to select the right accounting firm for your medical or dental practice. Like to discuss how GrowthMD can help you? Book a discovery call with us.

I walk through all the strategies and options for Dental Practitioners. ✅ JobKeeper wage subsidy eligibility ✅ Accessing the Cash Boost of $20,000 to $100,0000 ✅ Stimulus differences for those operating through companies, trusts or as sole traders ✅ Other stimulus measures including superannuation access & ATO deferrals ✅ Importance of cash flow planning over the months ahead Book a time to start maximising your stimulus benefit.