This transcript has been edited for clarity.
Roman Bronfenbrener, MD: My name is Roman Bronfenbrener. I’m a dermatologist in private practice at Pennsylvania Dermatology Specialists in Bucks County, Pennsylvania. I’m also a clinical assistant professor at the University of Pennsylvania, where I teach dermatology.
DermImmuno Today: What factors have contributed to the rise of demand in dermatology?
Dr. Bronfenbrener: It’s somewhat of a perfect storm, and I know we really shouldn’t be upset about being busy, but there’s definitely been an increase in demand that’s been fueled by a couple of things. One of them is social media. People are talking about various products, then patients come in and ask for our opinions about them. There’s a rising incidence of skin cancer. Patients who have had skin cancer end up coming in for skin exams at some frequency. That basically prefills out a large portion of your schedule, depending on what kind of population you serve.
On top of that, there have been decreases in reimbursements that physicians have had to deal with for the past 25-plus years. Because of this, we’re basically asked to do more with less, and the only way to really stay afloat and not be treading water is by doing more. That has certainly increased the demand on their daily lives in our clinical practices and has contributed to some of the burnout that we’re seeing.
DermImmuno Today: How does the increased demand affect dermatology practices?
Dr. Bronfenbrener: With increased demand is increased patients. That means that there’s more administrative work. Insurances need to get checked. You need to make sure that referrals are in place. Then there are administrative burdens on the clinical side, like prior authorizations for biologics that staff have to take time out of their schedule to do. The more patients and the more throughput that you’re seeing, the more that those other ancillary services increase as well. On the other end, too, is the billing aspect, where you have more bills going out. It’s harder to keep track of each individual one. Denials end up not getting worked up. Downcoding is a problem with many insurers. If you’re very busy clinically because you’re trying to meet the demand on you, it’s easy to let some of these other things slide, especially if you don’t have someone good who’s making sure they’re not.
On top of the demand of in-person visits, there are now a lot of people that expect telehealth, that might not otherwise have been plugged into the traditional healthcare system, that are trying to make tele-dermatology appointments with providers as well as with online companies. Some of those online companies stream patients into the office if they can’t help, and that’s a touchpoint for some patients where that’s their first experience with a dermatologist.
DermImmuno Today: What are the largest costs to an independent dermatology practice?
Dr. Bronfenbrener: To a small private dermatology practice, the largest costs are almost always staff related. We’ve been open for five years in my private practice, but staff expectations of what they would get paid have certainly gone up just in that short timeframe. On top of that, there’s rent if you’re leasing out a space or paying a mortgage; that’s often a very high secondary expense.
And then everything else is like the death by a thousand paper cuts. There’s health insurance, and you might be paying some or all of the premiums for your employees. Those prices are going up, and so that’s getting progressively more expensive. Vendors from whom we purchase our products—syringes, lidocaine, gauze, gloves, all that stuff—are kind of sequentially going up in price every year because of inflation, and we get periodic emails that, like, all prices are going up by 10% with this one particular vendor and then everybody scrambles to try to see if they can get lower prices on things as well. And so, inflation is certainly a large cost because the prices go up, and our input basically stays the same. You can only see so many people in a day safely.
On top of that, there’s the cost to do business. There are now a lot of administrators you need to hire to keep up with all the paperwork. In the years of paper charts or the good old days, as some people call them, that wasn’t so much of a factor. Now with electronic health records, it somewhat is. So, you have to have someone mining through your records, sometimes sending notes to insurers, pharmacies, or pharmaceutical benefit managers to get medications approved. All of these costs go up, but I think the largest cost would be staff.
DermImmuno Today: How can coding errors lead to lost revenue? How can dermatologists avoid these errors?
Dr. Bronfenbrener: In the Clarity RCM survey that you guys might be referencing with this as well, many providers don’t actually review their metrics. The majority do, but not everybody does, and it’s helpful to start looking at it so that you know what is getting paid and what isn’t.
And at the end of the day, nobody wants to work for free, and it really stinks when you do a procedure, or you see a patient, and you look at the EOB [explanation of benefits], and something got messed up because a pre-certification wasn’t completed, or you miscoded something. Those are errors that you should be able to fix with your electronic health record and by training your staff to document correctly, and that you are documenting correctly.
But a lot of it is also, are you choosing the correct code for the procedure that you’re performing? Dermatologists, I think, oftentimes get into a comfort zone where they repeat the same six or 10 codes that they use for everything, but there are site-specific codes for many things that we do. You should be as specific as possible with your coding so that you can get the reimbursement that you’re supposed to get. If you always code genital wart freeze as just a benign destruction of a wart, you’re missing out on the site-specific code, which reflects the work that you’re doing and is a higher reimbursement than if you code it as a 17110. Knowing those site-specific codes, either having it in the super bill if you’re still on paper or making sure that your EHR codes it correctly, you’re doing the work; you might as well get paid for it appropriately, and that is a more specific code for what you’re doing.
The other side is claims that just don’t get paid. Right now, for example, insurance will not pay lipoma excision codes that are the larger excision codes if you do them in the office. You might bring a patient in, do a pretty hefty surgical procedure, bill it appropriately, and then come to find out you get paid exactly zero because you couldn’t do it in an office, even though you safely and effectively do it and have done it multiple times. If you never track your reimbursements, you’ll never know about some of these things, and you might not change your workflow or how you do it to make sure you get reimbursed for the work that you do.
Lastly, there’s a lot of funny business that insurance plays with, either removing codes that they don’t think are relevant even though they’re placed, and they’re in the note, and there’s work that you did, or downcoding a visit just because it came from a dermatologist. How could it be a level four? They’ll make it a level three. Unless you’re actively sitting there tracking all of your ins and outs, you’re going to miss a lot of these things. This is one of the parts of my practice that I delegate to a rather large team of people that can see exactly what’s going in and out. Because as a provider, three weeks go by and you see that EOB, you don’t remember what happened during the visit or was it a level… Even if you read the note, was the level three or four or what… Delegating this part has been very helpful for us to make sure we’re staying on top of it.
And when we notice stuff, we speak up. We don’t just say, “All right, they downcoded whatever.” We get involved with our local and state societies. I’ve reached out to the AAD, their payor group, with any inconsistencies and issues so that we can work on it as a group, as opposed to just one individual practice complaining, because together we’re so much stronger.
DermImmuno Today: How is AI being used by dermatologists?
Dr. Bronfenbrener: Dermatologists are using AIs, even kind of Luddite dermatologists. Everybody does a Google search. A lot of people don’t know, when you do a Google search now, you’re basically using AI. You can have a conversation with your search results just from the main Google page, and that was just a change that was put in there one day, and it wasn’t like someone really opted in. It’s like it just showed up for everybody that now you can use AI when you do a standard Google search. A lot of people, that’s their initial kind of introduction to it, is more of the chatbot-based version, or they have gone to ChatGPT and had like a conversation about things.
I personally think it’s great. I think if you don’t use any AI at all, you might get left behind. It definitely can simplify your life in terms of answering maybe difficult clinical questions. There are AIs that are specifically done for that. But also answering questions about the business aspect. You get a letter from the IRS and it’s 15-pages long. I would put it in through AI, and I would say like, “Explain this to me, what’s going on?” I mean, I have an accountant too, but it’s nice when you can be as educated as possible without having to understand all the jargon necessarily that’s in there.
If you’re going to be using an AI for clinical matters, like you want to discuss patients with it or you want to upload test results and help interpret them, you want to make sure that you have a business associate agreement (BAA) signed with whatever AI provider you’re using. Many dermatology practices use Google, in which case you would sign the Gemini BAA, and that’s included with the Workspace subscription. If you’re using Microsoft, it’s Copilot, and so on and so forth. Once you sign the BAA, you can actually share protected health information, and it won’t be used to train the AI in the future. It won’t show up in someone else’s search result. It’s considered secure as if you’re having a conversation with a colleague.
Lastly, I think AI is going to be integrated more and more into our EHRs. I know Modernizing Medicine has an AI scribe that they’re piloting. I know that there are a lot of other AI scribe companies. There are a couple of newer electronic health records. I think these are the early days. It’s very difficult right now to pick who the winners are going to be, but I imagine there’s going to be a lot of companies that maybe don’t make it or some other tool ends up taking its place. But I’m happy to see that people are using it. And when I talk to other physicians, they’re not generally asking for an intro course to AI. It’s more like more specific uses, like maybe coding or avatar video generation, things like that, that are a little bit more complicated. I think some people are starting to dip their feet in the water with it.
But it’s incredibly useful all around, and I think it’s going to really help with the overhead aspect of our practices in the future where AI might be able to do some of these things that right now require administrative time, and maybe you can hire one less administrator. Well, that’s already a huge sort of help for your overhead.
DermImmuno Today: What are some key differences between independent- and private equity (PE)-owned practices?
Dr. Bronfenbrener: There are multiple differences between independently and PE-owned, and there are also people that go into academic practice, for example. One of the main differences in private equity is you generally have a little bit of a kind of restricted power of what you can or can’t do. You can’t necessarily decide who you’re going to hire and who you’re going to fire. You can’t pick who your manager is going to be. And so that’s something that you give up versus an independent practice where that all falls on me.
On the flip side, though, with great power comes great responsibility, like from Spider-Man. And when you have all of these things that you’re able to change, that also comes with a lot of downstream ramifications. When you’re also working as the HR, you’re hiring people, you’re firing people, you’re picking vendors on your own. On the PE side, it’s nice to have someone who arranges everything for you. It might not be the exact way you want it, and every PE practice is probably different, but the fact that someone else is managing means you’re relinquishing some of that control.
Some of the other differences between independent and PE-owned practices are maybe choice-driven. A lot of times in PE practices, there’s a desire to keep pathology all in-house or surgery all within that practice, and you might lose the ability to refer to physicians or specialists that you might otherwise have chosen to refer to. And then there are probably reimbursement differences between an independent practice that’s run very efficiently versus a private equity practice that has to cover its overhead, management, and administrators.
If you feel like you want to work and you want to take on the responsibility of independent practice, it should generally be more financially lucrative than if you work for someone and collect a W2.
DermImmuno Today: Is there anything else you would like to add?
Dr. Bronfenbrener: It’s important for dermatologists to review their financial metrics. It’s really the lifeblood of the practice. If you don’t know what’s going on, you will end up getting carried away, and you’re going to lose money and not be able to support the practice that you want to have.
It’s so important because it’s constantly changing. Every year, the rules change. Every month, insurance, especially private insurance, might all of a sudden change a policy, and you have something different that happens. It’s not enough to look at it once a year or something like that. This should be tracked very frequently for dermatologists.