Masoud Khorsand, M.D., is bringing the revenue cycle management expertise he developed at his own clinic to other physician practices.
There needs to be a revolution in how offices are run over the next 15 years because practices are generally very inefficient. If you dont manage finances well, you cannot provide good care to patients, says Khorsand, president of five-physician Southeastern New Mexico Internal Medicine, Hematology and Oncology, Roswell.
Facing Medicare reimbursement cuts in 2003, rising drug costs and days in accounts receivable above 60, Khorsand knew he had to improve his billing department or close down.
Oncology practices spend $4 million to $5 million in drugs per oncologist. If only 5% to 10% of this cost is not reimbursed, the practice cant survive, says the Iranian-born Khorsand. You either have to close the door or move to a bigger town with a better payer mix. Our option was to create a more efficient office through billing solutions.
Khorsand began working with a group of software technicians and in 2004 co-founded Catalisse, a privately owned, for-profit medical billing company that offers revenue cycle management and software development.
Headquartered in Rockville, Md., Catalisse has offices in Roswell, N.M., and Lahore, Pakistan, where off-site revenue-cycle management analysis is conducted. The company employs about 55 workers. Khorsand, who also is an investor in the company, declined to provide annual revenue or the number of investors.
Using Catalisse, we reduced our average collection days by 40% to 35 days and increased collections by 15% in the first year, he says.
Later this year, Catalisse is expected to finish beta testing Revenuity, its revenue management software, Khorsand says. Revenuity is designed to reduce revenue leakage through services that include electronic billing and patient-bill generation, patient collections and medical transcriptions. Revenuity also manages overdue accounts and resolves denied claims.
While each practices return on investment can vary, Khorsand says the two clients and five practices that use Catalisses revenue-cycle management services average about a 15% improvement in gross revenue. If your costs remain the same, your profits may increase 30% to 40%, he says.