Increasing Your Bottom Line And Practice Value
The two most important factors in determining practice value are Current Annual Revenue and Net Cash Flow. Therefore, increasing productivity and improving the bottom line of your practice will not only increase your personal income but also enhance the value and marketability of your practice when the time comes to sell. Here are a few ways that you may be able to increase production and efficiency in your practice:
- Offer flexible financial plans that allow the patient to pay their portion of the fee with equal monthly payments from outside banking sources (i.e. Care Credit) and/or debit their credit card using the VISA easy pay consent form.
- If you are in-network with PPO insurance plans, periodically review these plans and submit an updated fee schedule requesting a higher reimbursement rate.
- Consider enhancing your website (e.g., add patient testimonials and promote things that differentiate you from other practices). Also, utilize email and text messages for recall notices and patient newsletters. For more information check out: www.patientdocs.com.
- Increase new patient flow by routinely asking patients for referrals (e.g., “Thank you for coming in today. We sincerely appreciate having you as a patient. What can we do to get more patients like you?”). Write thank you notes and/or provide a small gift to patients who refer other patients.
- Encourage patients to post positive reviews on Google and Yelp and make it as easy as possible for patients to do so.
- Provide business cards for all staff members with their name and business title to hand out to friends, neighbors, and other businesses in the community.
- Review your lab and supply expenditures. Find areas to save money by talking with your current suppliers or comparing pricing with different suppliers. A good target budget is 6-7% of your annual collections for clinical supplies and 1-2% for office supplies.
- Review all maintenance and service contracts to see if there are opportunities for savings.
- If you have debt on the practice, now is a good time to consider consolidating loans at lower interest rates.
- Reduce disability insurance costs by extending the elimination periods and raising deductibles on health insurance.
- Work with your accountant to perform “financial surgery” on your practice and determine where you could “trim fat” and reduce overhead expenses
- In the current real estate market, you may be able to renegotiate the lease rate on your office space and/or receive funds from the landlord to improve your office space, especially if you offer or agree to extend the length of your lease term.
- Meet with your staff and solicit their ideas on how to increase new patient flow, increase practice productivity and efficiency, and reduce overhead costs.
- Look at your staff situation and see if there are areas for improvement or changes that should be made (e.g., replacing a poor performer with a top performer).
- Personally call every patient you treat clinically after their appointment to see how they are feeling. For new patients, send them a hand written note right after their first visit to welcome them to the practice.
- Survey patients and review the survey results with your staff to see how you are doing in the following areas:
- Friendliness of receptionist and staff
- Seeing patients promptly, i.e., under 10 minutes
- Explaining services and costs clearly
- Providing flexible financing plans
- Providing personal attention that does not make the patient feel rushed
- Acceptance of insurance plans
- Sufficient appointment reminders (calls/emails)
- The look, feel and smell of the office
- Timely processing of insurance claims
- Anesthesia that does not hurt