Innovative AI-powered technology is one factor disrupting the corporate takeover trend

For many private practices, selling to a large corporation or hospital may seem like the only answer to address the challenges of today’s health care market. According to the AMA 2022 Physician Practice Benchmark Survey, many private practices turn to corporate medicine for help negotiating higher payment rates and managing regulatory and administrative requirements. But there is another way forward.

Innovative AI-powered technology is one factor disrupting the corporate takeover trend, making the private practice business model more feasible by enabling transparent costs, increasing instances of payment at the time of treatment, resolving accounts receivable, simplifying patient education and enhancing clinical documentation.

Financial challenges and regulations stifle private practices

Private practices increasingly find themselves squeezed between higher administrative costs and increases in unpaid medical bills. At the same time, they must comply with new laws and compliance regulations that make it harder than ever to collect balances due from patients.

Managing a practice encompasses many costs including electronic health records, clinical integrations, patient engagement, payment processing and billing services. Each vendor carries set fees plus additional fees for normal use volumes, driving massive expenses – even for those marketed as "low cost." These expenses are compounded by rising costs for rent, insurance and medical equipment – making profitability evasive for private practices.

At the same time, there is an increasing threat of never receiving outstanding balances due to the Joint Statement from Credit Bureaus, which removes medical collection debt less than $500 from patients’ credit reports. States like Colorado and New York extended this, prohibiting inclusion of any medical debt information on credit reports. When patients are unwilling to pay what they owe, it strains the private practice’s budget – impacting cash flow and making it difficult to cover operational costs and payroll. On top of that, confusion and frustration regarding unpaid balances is a top source of negative reviews, which also causes lost patients.

Adding to these challenges is new legislation, such as the No Surprises Act to ensure transparency in health care costs prior to treatment. The mandates include providing Advanced Explanation of Benefits (AEOB) for in-network visits and Good Faith Estimates (GFE) for self-pay patients. Many practices have not yet fully addressed the impact of these changes on their business.

AI-enabled technology boosts private practice profitability

Technology powered by the latest in AI and automation is key to enabling private practice owners to address these challenges. Infusing AI throughout each function optimizes the practice management system to help physicians save time, reduce costs and enhance profitability. Here are a few examples of the benefits of AI-enabled technology:

• Eliminate the manual steps needed to gather data and the subsequent guesswork required provide cost transparency and accurate estimates before treatment as required by the No Surprises Act.

• Increase frequency of complete payments by estimating patient liability before treatment, offering payment options, and making payment arrangements at time of treatment.

• Resolve accounts receivable with analysis of outstanding patient balances and automated tasks to reduce accounts receivable.

• Simplify patient education and improve the patient experience with easy-to-understand, personalized information explaining eligibility, fees and balances.

• Enhance clinical documentation with advancements in charting to save physicians time and effort while maintaining compliance and data security.

Being a health care provider carries a heavy weight of responsibility for patient safety and security that also applies to the private practice’s technology selections. When considering non-EHR AI plug-ins, ensure they do not share information with centralized databases, which can impact HIPAA compliance. Instead, look for a secure, ONC-certified system that does not rely on outside data sources or pass data to third parties.

At the same time, be wary of systems that use outside knowledge to write narratives, code procedures or diagnoses, or make patient plans. AI can be used to augment practice efficiency but should not completely replace information that the physician – the clinical expert – originates.

Keeping the private practice profitable

Consolidating vendors and streamlining systems is one way to simplify workflows and controls costs, but it is also important to consider the latest technological advances. Several technology innovators have applied AI to various practice workflows, offering new ways to save time and effort.

The ideal solution is an all-in-one practice management system that offers benefits across the entire patient interaction – from marketing to scheduling to onboarding to office visits to clinical documentation to billing and payment. The value of the system is further maximized when data is shared in an integrated loop across functions to increase efficiency, optimize revenue cycle management and improve work-life balance. The savings flow through to the bottom line and keep the private practice profitable.

Technology for patient care and office use is essential in today's medical practice. AI is a catalyst for changing the status quo with new advancements that help private practices thrive in today’s health care landscape. Without significant technological improvements, rising overhead costs and documentation pressures will continue driving many physicians to sell their private practices to corporations, or worse, leave the profession.

Jeremy Shiner is the founder and president of Myriad Systems, a provider of comprehensive practice management software and services designed exclusively for private practices.