We don't need to tell you what you already know: running a profitable practice is a challenge. Physicians are dealing with more challenges now than ever, between balancing revenues and overheads, monetizing after-hours care, and competing with urgent care clinics.
Luckily, help is out there--in the wise words of physicians who have done it. After all, no one understands how to run a practice like a doctor. We reached out to our friends and colleagues in healthcare, and asked this question:
"What's the key to running a profitable practice? How have you managed to keep medical practices profitable in this challenging, ever-changing time in healthcare?"
In response, physicians, practice managers, and consultants from across the country gave us their best advice.
1. "One of the greatest assets to every practice is a patient. They are not an interruption of the practice, but its purpose. To that end, doctors and their staff must review procedures and protocols of the front desk. A practice’s identity is developed the moment a person states, “Good day, this is Main Medical! How can I assist you?” Should phones and direct contact be apathetic, aggressive or even impersonal, then it is possible the practice is turning away patients. I was greeted by the front desk of my allergist yesterday whom was dismissive and acted as if I interrupted their conversation with another staff member. Doctors are similar to retail stores--there is always another. Therefore, a good strategy is to constantly review the demeanor and culture of the front desk by hiring external individuals to mystery shop the practice. Conduct surveys to uncover anomalies and create a better patient experience."
Drew Stevens, Practice Management Coach
Stevens Consulting Group
2. "There is a tremendous consolidation in healthcare, where practices are merging into groups, and groups merge into super groups, and hospitals buy practices and groups, hospitals merge to become systems, and hospitals and insurers acquire each other. To survive and thrive, medical practices need to adapt and change along with the market. That means growing to build scale, marketing, focusing on profitable niches, and being efficient. They also need to be highly cognizant that referral patterns are changing. You can no longer rely on a handful of referring practices, because those practices often are being merged into new systems or hospitals. So in many cases practices, especially specialists, need to reach out to the public directly through marketing."
Stewart Gandolf, MBA
3. "Primary care physicians (PCPs) are in a non-sustainable business model. Overheads have risen faster than revenues for the past two decades. PCPs now see twice as many patients per day (24 or more) than before to earn the same income, inflation-adjusted. Visits are 15 minutes with 8-10 minutes of actual “face time." The best resolution is to refuse all insurance and charge the patient a reasonable fee per visit, or charge a monthly membership or annual retainer fee. The patient panel is reduced to 500-800 from the standard 2500-3000, visits are same or next day for as long as needed and the patient can use the PCP's email or personal cell phone 24/7. Care is much better, frustrations are down, satisfaction is up and total costs are reduced."
Dr. Stephen Schimpff
4. "My best recommendation is heavy advertising! By letting people know your practice provides a VIP experience through Medical Minute-type TV ads, a doctor can bring in a large number of potential leads. That's been my secret to building my practice."
Dr. Jonathan Kaplan,
5. "Parkside Dental Team in Westland, Michigan is a full-service dental practice in a prime location, but with a lot of visual competition for potential patients. In June of 2014, the four dentists in the practice invested in a new advertising tool that would be flexible, responsive and dynamic: a Watchfire LED message center. The ability to quickly and easily change the sign’s content gave them the control to advertise last-minute openings and specials...Within the first month of the sign’s installation, Parkside’s new patient count increased by 25%. After 4 months, that increase was nearly 50%. Parkside Dental Team estimates that the sign helped to bring in over $100,000 in new business in its first four months of operation."
7. "One key to sustaining profitability is to keep up with the ever-changing regulatory landscape surrounding billing. New laws, new codes, and new documentation requirements are the norm. Payors are consistently doing everything they can to deny payment. It is imperative to stay ahead of the curve where the goal is an ever moving target. Increasing productivity without getting burnout is difficult; leveraging help such as scribes can be very beneficial. The key is to run smarter, not faster."
Glen McCracken, M.D., M.B.A.
President and Cofounder, eVisit
8. "I feel like service, availability and innovation, all aimed at “bending over backwards” for my patients, is the key. I add new patients every day through the best advertising in the world: word of mouth. It is our commitment to service that does it. Our profitability is totally due to service and truly caring for our patients. I tell my staff that we want to treat all of our patients as we would want ourselves and our loved ones treated: according to the “Golden Rule." Patients come to see us, not because of us being in network or having a lower co-pay...because we participate with no insurance company and no third-party payer. Our patients, from all walks of life and all financial strata, choose to come here because they know we care and will take care of them as individuals, not as numbers. I was taught way back when that we were to treat every patient as the wonderful individual that they are, not according to some medical guideline cookbook. That individual and personal attention is what makes patients continue to flock to us."
Robert W. Patterson, MD, Diplomate AAFP
Every physician has their own secret to profitability, so we want to know: what's yours? Exchange your ideas with other healthcare experts in the comments, and you may just learn something new.