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What Is Healthcare Practice Management?


Healthcare practice management is a specialized field focused on running a healthcare business. This includes administrative tasks, such as scheduling appointments, billing, and managing patient records, as well as strategic and operational tasks, such as staffing, budgeting, and ensuring compliance with healthcare regulations. The goal of practice management is to streamline these processes to improve a medical practice’s financial livelihood, efficiency, and patient care.

What Are the Most Important Medical Practice Management Skills?

Practice management involves a range of skill sets and responsibilities. The practice manager may perform the work alone or work with others who complete the tasks. Some key medical practice management skills are:

  • Financial management: Healthcare practice managers need a variety of financial skills to effectively run a medical practice. Practice managers need to understand budgeting, which includes planning how to use the practice’s financial resources to meet its goals. Running financial reports, or at least knowing how to read the financial data, is another important skill. These reports provide a comprehensive view of the organization’s financial health, tracking the revenue, expenses, assets, and liabilities. This data can help practice managers make informed decisions about the practice’s operations and investments. Practice managers also need to understand revenue cycle management, including medical billing and collections to ensure that the practice receives accurate payment for its services. This area also includes understanding healthcare reimbursement models (how providers get payment for their services) to maximize the practice’s revenue. Another key skill is the ability to analyze and implement healthcare financial regulations to ensure the practice’s compliance.

  • Human resources management: Healthcare practice managers need strong leadership and communication skills to interact with staff, patients, and other stakeholders. Practice managers also need to be adept at conflict resolution to handle disputes that arise in the workplace. Recruitment and hiring skills are essential for bringing in qualified staff, while training and professional development skills are necessary for ensuring that staff members are equipped to perform their roles effectively. Additionally, practice managers need to be proficient in performance management to evaluate staff efforts and provide constructive feedback. Understanding employment laws and regulations is also crucial to ensuring the practice complies with all legal requirements.

  • Regulatory compliance: Healthcare practice managers must have a thorough understanding of healthcare laws and regulations, including the Health Insurance Portability and Accountability Act of 1996 (HIPAA), the Affordable Care Act (ACA), and Occupational Safety and Health Administration (OSHA) regulations. They need to be proficient in medical coding and billing rules to ensure accurate reimbursement and avoid legal issues. Practice managers also should be familiar with applicable standards set by accrediting bodies such as The Joint Commission, which help healthcare organizations measure, assess, and improve performance to provide safe, high-quality patient care. Additionally, healthcare practice managers need to stay updated on changes in healthcare regulations and implement necessary changes in the practice as needed.

  • Strategic planning and marketing: Strategic planning skills involve setting goals, developing action plans, and making decisions about allocating resources. Practice managers need to understand the healthcare market, identify opportunities for growth, and plan for potential challenges. They also need to be able to analyze data to inform their strategic decisions. Marketing skills assist healthcare practice managers to understand their target audience, which includes patients and potential patients. Practice managers should be able to develop and implement marketing strategies to attract and retain patients. This could involve traditional marketing methods, such as print advertising and direct mail, as well as digital marketing strategies, such as social media and email marketing. Practice managers also need to have the ability to measure the effectiveness of their marketing efforts and adjust their strategies as needed, while remaining in compliance with state and federal regulations. Effective strategic planning and marketing help healthcare practice managers grow a successful medical practice.

Healthcare Practice Manager Characteristics and Job Titles

Medical practices typically look for practice managers who are highly skilled, dedicated, and patient-focused and seek professionals who have a strong understanding of healthcare systems and regulations, as well as the ability to adapt to the ever-changing healthcare environment. Medical practices value individuals who can work well in a team and communicate effectively and hire individuals with a strong work ethic and problem-solving skills who are able to handle stressful situations calmly. The common goal of practice managers is to contribute to high-quality patient care while improving the overall efficiency and financial stability of the practice.

Healthcare practice managers can hold a variety of titles based on their roles and responsibilities. Some common titles include practice manager, office manager, and healthcare administrator. These individuals may also hold positions as medical office managers, patient services managers, or health services managers. In larger healthcare organizations, you might find roles such as director of operations, chief executive officer, or chief operating officer. Each of these positions plays an essential role in ensuring the smooth operation of a healthcare practice, focusing on areas such as patient care, staff management, financial management, and regulatory compliance.

What Education Is Typical for Practice Managers?

Healthcare practice managers typically need a combination of postsecondary education degrees and professional certifications designed to equip them with the knowledge and skills necessary to effectively manage a healthcare practice. Practice managers often hold a bachelor’s degree in a field related to healthcare administration, although many employers prefer candidates with a master’s degree. These degree programs usually cover topics such as healthcare laws and regulations, health information systems, and healthcare financial management.

In addition to postsecondary degrees, healthcare practice managers often pursue healthcare practice management and healthcare finance certifications to demonstrate their competence and dedication to the field. Certification requirements may include a combination of education, experience, and passing an examination. Certifying organizations also may require ongoing education to maintain the certification.

What Medical Practices Look for in Practice Managers

Besides seeking candidates with practice management certifications and higher education degrees, medical practices may look for practice managers who have practical experience in a healthcare business setting and can apply theoretical knowledge to real-world situations, having honed their problem-solving and decision-making skills. Soft skills such as communication, leadership, and adaptability are key to the practice manager’s skillset and vital to managing a team and navigating the dynamic healthcare environment. Medical practices also value managers who stay updated on the latest industry changes and can use that knowledge to successfully operate the business.

How Do Healthcare Practice Managers Succeed at Their Jobs?

Healthcare practice managers succeed at their jobs through various strategies:

  • Implementing efficient patient scheduling systems to minimize wait times and improve patient satisfaction

  • Managing patient records effectively, ensuring accuracy and confidentiality

  • Applying financial management by monitoring the practice’s revenue and expenses, creating budgets, and applying strategies to increase profitability

  • Handling billing and collections, ensuring timely payments from patients and insurance companies

  • Establishing effective human resources management by hiring competent staff, providing necessary training, and fostering a positive work environment

  • Safeguarding the practice by complying with all healthcare laws and regulations to avoid legal issues

  • Facilitating strategic planning and marketing to attract more patients and help the practice thrive

Last reviewed on Dec. 14, 2023, by the AAPC Thought Leadership Team

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