Determining the Value of Front Desk Staff in a Medical Clinic

One of the lowest paid positions in healthcare has become one of the most influential in the financial well-being of an organization. The front desk position has always been responsible for a variety of aspects of the clinic—greeting patients, ensuring they arrive when and where they are expected, collecting demographic data, and collecting copays/coinsurance. All of these duties have a potential financial impact on the clinic, for better or worse. In recent years, the shift of payment responsibility from insurances to patients has increased the financial impact of the front desk position.

According to the Medical Group Management Association 2017 survey of Management and Staff (based on 2016 data), medical secretaries (also referred to as receptionist, front desk, Director of First Impression) are paid 7% less than other medical administrative support staff.(1) On average, as of 2016 this position is paid $14.50 per hour in physician-owned practices.

How can clinic managers prove the value of these positions and determine the appropriate pay? To review a position’s worth to the clinic, three areas should be analyzed:

1. The expectations of the position;

2. The potential costs to the organization if the work is performed incorrectly; and

3. The potential savings for the organization if the work is performed well.

This creates a baseline value of the position. (It will not show the worth of an individual employee.)

Expectations

Expectations of front desk staff have changed in the last few years. As insurance companies and the structure of payments move the burden to patients, the front desk must now take on pre-billing roles and duties. The days of billing the insurance company first and not attempting to collect any money from the patient until a response from the insurance company is received, are over. The challenge of collecting more money from patients at the time of service (e.g., copays, coinsurances, and deductibles) is the new workflow. The duties listed in the job description for a specific front desk staff member may vary, but the expectations from managers, providers, and patients usually are the same:

• Answer phones in a polite and welcoming way;

• Greet visitors and patients in a welcoming manner;

• Direct patients to the correct location upon arrival;

• Know the answers to all patient questions;

• Take appropriate messages with correct spelling, directed to the correct person;

• Schedule appointments for all providers in the clinic correctly (even if each provider has a different set of scheduling rules);

• Collect all patient demographic information and enter it correctly into the required system;

• Ensure all demographic information is updated and corrected for every patient, every time;

• Communicate any delays from the back office to the patients;

• Ensure appropriate messages are given to patients (from the back office or legal, such as HIPAA rules or availability of translators);

• Ensure that the front desk, lobby, and entrance to the clinic are clean and welcoming;

• Manage all patients and visitors in the lobby, dealing with any problems (e.g., patients, children, spills or messes);

• Be able to explain the clinic’s patient billing practices and answer questions about bills;

• Collect appropriate copays, coinsurance, and deductibles;

• Be familiar with insurance requirements for each patient and carrier;

• Deal correctly with all incoming paperwork: faxes, e-mails, patient portal; and

• Call insurance companies for prior authorizations or confirmation of benefit.

Some organizations may split these duties among different position titles (e.g., Receptionist, Scheduling Staff, Insurance Clerk), although usually they still fall under the “front desk” department, where employees receive lower pay than other support staff. These listed duties, however, are vital to the success of the clinic. Managers and patients expect front desk positions to be held by someone who is customer–oriented and always willing to go the extra mile. At the same time, this person must follow all of the rules that the clinic and others have set for them. The staff member must have full knowledge and understanding of HIPAA, OSHA, coding, documentation, insurance, and other rules and regulations (e.g., the requirement that translators be provided). However, the training required to reach this high level of understanding rarely is given when an employee is hired. It is expected that incoming employees already know this information or will absorb it as they work and learn the nuances of the organization.

Several community colleges and charter schools have created programs to meet the new need for administrative support staff training.

This is in strict contrast to the other positions in the clinic. Medical support staff (e.g., medical assistants) are hired only after they have completed a certification or associates degree in the appropriate area of expertise. In addition, a number of billing positions now require the same level of education (e.g., certified coders, billers). In response, several community colleges and charter schools have created programs to meet the new need for administrative support staff training. Throughout the United States, from New Jersey (Bergen Community College) to Florida (Eastern Florida State College) and Alaska (Alaska Career College) to Texas (San Jacinto Community College), students can earn certificates or associate degrees in Medical Office Administration. The coursework includes the study of HIPAA, medical records management, and customer service, and externships in medical clinics or hospitals.

Cost and Savings

Without the needed training and knowledge, front desk staff members can cost the organization. Poor customer service interaction or incorrect data entry can cause a financial deficit. The cost of losing a patient or delays in billing can be calculated to determine the worth (beyond wages and benefits) of a front desk position. For every one patient with a bad experience, the expectation is that they will tell at least seven others. These seven may be current patients of the organization or potential new patients that are lost. The value of a patient is calculated based on the practice’s number of visits and patients, and either the cost per visit or revenue per patient.

A well-trained, knowledgeable front desk staff can save the clinic money.

In contrast, a well-trained, knowledgeable front desk staff can save the clinic money. Most reviews of clinics mention the quality of the front desk staff. A positive experience keeps patients coming back and telling others. Efficiencies at the front desk can create savings elsewhere as well. A front desk staff that manages the patient schedule effectively is invaluable. When patients are scheduled for the appropriate amount of time and are checked in for their appointment correctly, more patients can be added to the schedule. It is feasible that this could allow for at least one more patient per provider per week. In addition, highly effective front desk staff can ensure that insurance claim denials for demographic errors are low.

Calculations of Worth

Using the data in the 2017 Medical Group Management Association (MGMA) Management and Staff Compensation(1) and the Cost and Revenue(2) surveys (based on 2016 data), a general estimation of what these positions might be worth in a Family Practice and Pediatric clinic can be made (see sidebar). Reviewing visits, patient load, expenses, and revenue of a clinic gives the needed information to calculate the value of the front desk position. An organization can utilize its own data to find these values and perform a specific calculation of worth in its clinic (Table 1).

In calculating the cost and savings that a front desk position can create for a clinic, certain supplementary information should be taken into account. Costs vary by clinic and workflow. In our examples, it is assumed that the workflow is the same and that the front desk is responsible for collecting demographic information and entering it into the billing system. As discussed earlier, the front desk staff is also responsible for the patient experience. One bad patient experience can lead to the loss of seven other patients. A good experience, leading to a great online review, has the potential of adding one to three new patients to the practice annually.

The 2017 MGMA Practice Operations survey, based on 2016 data, found that the median percentage of claims denied on first submission ranges from 5.0% (Family Practice) to 3.0% (Pediatrics).(3) For Better Performers (i.e., clinics performing at a high level), the median percentage of denied claims on the first submission is only 3%. The industry standard is that 90% of all denied claims are preventable. The reasons for these denials include missing or incorrect patient demographic information, services not covered, or duplicate claim submission. The first two reasons can be avoided by attentive and well-trained front desk staff. Therefore, it can be estimated that 50% of incorrect claims are the result of the front desk staff performance.

Industry studies have shown that when patients leave the clinic after their visit without having paid their portion of the charges, the chance that the clinic will collect the patient-owed amount is only 30%. Currently, clinics estimate that 30% of their revenue comes from patients directly. Thus the dramatic drop in collection probability when payment is not collected at the time of service has a large impact. It is anticipated that this percentage of income may increase to as much as 50%, as more patients have higher insurance deductibles and copays, in the next three years.

Conclusion

The data support that, for these representative practices (Family Practice and Pediatrics), the front desk staff should have a starting salary slightly higher than the 2016 national average. If the number of staff is lower, the expectation for better performance must go up, and so must the starting wages. However, each clinic is unique, and calculations should include information about specific employees. A great front desk lead, for example, can take up the slack and correct the errors of mediocre medical receptionists on the team.

These calculations do not discuss expectations for the position as a numerical value. It is assumed that the expectations must be met in order to ensure the savings calculated, and thus are accounted for. What is not accounted for is individual employee initiative, emotional intelligence, and work ethic. These should be considered when evaluating a specific employee and not just a position.

By reviewing visits, patient load, expenses, and revenue of a clinic, a practice can calculate the value of their own front desk. The front desk staff has as much influence on the well-being of a practice as the certified medical assistants, medical billers, and coders. Changes in the administration of medicine now require that the front desk staff be well-trained, and have a thorough knowledge of the rules and regulations and an understanding of the importance of customer service. Managers should, therefore, apply more scrutiny in hiring for these positions and set pay rates accordingly. Recognizing that the front desk staff is an important part of the organization is long overdue.

References

1. MGMA DataDive® Management and Staff Compensation 2017, based on 2016 data. MGMA, Englewood, CO.

2. MGMA DataDive® Cost and Revenue 2017, based on 2016 data. MGMA, Englewood, CO.

3. MGMA DataDive® Practice Operations 2017, based on 2016 data. Englewood, CO.

Worth of the Front Desk Staff in Medical Practices

Family Practice:

The following figures apply to a physician-owned family practice with six physicians and six front desk staff (.98 medical receptionists per FTE provider).(1)

• Cost of front desk errors: $409,412.05 ($67,837.61 per front desk staff member)

  • Seven patients lost: $2,386.41 (annual revenue per patient × 7) per front desk staff

  • Delay in claims: $243,442.00 (2.5% of claims delayed due to front desk errors) for all front desk staff(2)

  • Lost income: $146,265.20 (assuming 10% of the amount owed by patients [30% of revenue] was never collected at the time of service or thereafter) for all front desk staff

• Savings due to front desk: $235,761.84 ($33,680.26 per front desk staff member)

  • Three new patients gained: $1,193.20 (annual revenue per patient × 3) per each front desk staff member

  • Prompt payment: $171,809.40 (difference made by reduction of delayed claims by the front desk to 1.5% from 2.5%) for all front desk staff

  • Extra visits: 1 more visit per day week (52) per provider (6) = $55,600.02 (lower no-show rate, filling open schedules, reduction of time wasted in the back office due to incorrect scheduling of appointments) for all front desk staff

• National average hourly wage for a medical receptionist in a physician-owned clinic with six or fewer FTE physicians:$14.14 (annual salary = $29,411.20)(3)

  • Cost of wages and benefits per front desk staff member: $35,293.44

  • Cost per front desk staff member in errors: $67,837.61

  • Savings per front desk staff member: $33,680.26

Pediatric Practice

The following figures apply to a physician-owned pediatric practice with six physicians and five front desk staff (.80 medical receptionists per FTE provider)(1)

• Cost of front desk errors: $252,555.55 ($50,511.11 per staff member)

  • Seven patients lost: $3,329.42 (annual revenue per patient × 7) per each front desk staff member

  • Delay in claims: $78,636.15 (1.5% of claims delayed due to front desk errors) for all front desk staff(2)

  • Lost income: $157,272.30 (10% of the amount owed by patients [30% of revenue] never collected at the time of service or thereafter) for all front desk staff

• Savings due to front desk: $61,106.72 ($10,184.45 per staff member)

  • Three new patients gained: $1,426.89 (annual revenue per patient × 3) per each front desk staff member

  • Prompt payment: $0.00 (the data show that pediatric practices are, on average, performing at the Best Performer levels; therefore, little savings can be assumed in decreasing denials)

  • Extra visits: 1 more visit per week (52) per provider (6) = $52,545.36 (lower no-shows, filling open schedules, reduction of time wasted in the back office due to the incorrect scheduling of appointments) for all front desk staff

The national average hourly wage for a medical receptionist in a physician-owned clinic with six or fewer FTE physicians is $14.14 (annual salary = $29,411.20)(3)

• Cost of wages and benefits per front desk staff member: $35,293.44

• Cost per front desk staff member in errors: $50,511.11

• Savings per front desk staff member: $10,184.45

References

1. MGMA DataDive® Cost and Revenue 2017, based on 2016 data. Used with permission from MGMA, 104 Inverness Terrace East, Englewood, CO 80112. 877.275.6462. www.mgma.com . Copyright 2017.

2. MGMA DataDive® Practice Operations 2017, based on 2016 data. Used with permission from MGMA, 104 Inverness Terrace East, Englewood, CO 80112. 877.275.6462. www.mgma.com . Copyright 2017.

3. MGMA DataDive® Management and Staff Compensation 2017, based on 2016 data. Used with permission from MGMA, 104 Inverness Terrace East, Englewood, CO 80112. 877.275.6462. www.mgma.com . Copyright 2017.