3 ways to grow practice profits, ethically
Well first of alllet’s get comfortable with fact that profit is not a dirty word for health profession. Many doctors don’t like to use the term profit as it seems too commercial. Well for me, generating profits is only way you can serve your patients well. Simplistically, if you are not having enough profits, you will be stressed, your investment in practice will be reduced, resulting in compromise in patient care.
- Increase Sales: First way to grow profits is obviously to increase sales i.e. incoming patient fees. Well, that sounds easy? With increasing competition, regulations and patient expectations, it is not easy at all. Further, let me make an important clarification- I am not suggesting any unethical ways to generate more income. It is also understood that there is limit on how many patients a doctor can see per day.
If your practice does not have full book, the most important way to increase sales is by getting more patients. Having a proper marketing system will ensure that you will have more patients coming to seek your advice, resulting in increased sales.
If your books are full, may be you can employ more doctors to reopen the books.
If you can not get more doctors, then you can increase sales by serving more patients. With proper processes in place, you can serve patients more efficiently without compromising the care and have some time left to see more patients.
- Reduce costs: This may sound like a no-brainer. Often people think reducing costs means reducing staff costs. That’s old school; reducing staff may result in burnout of existing staff. Instead, reduce other variable costs through a proper procurement system. My clients are often surprised by how much costs they can save by just having 3 quotes for any purchase items- whether its is your consumables, medicines or big ticket items.
I see many practices buying from one supplier for years. Its definitely good to build such long term relationships. But it does not hurt to check if you are still getting the right price and right service.
- Provide more services to existing patients: It is one of the sure ways to increase sales and service to patients. The more reliable services your patients get by coming to your practice, lesser they have to keep searching for these services. Get feedback from your patients regarding what services they are looking for and you will find the answer. If increase in services requires capital investment, then do a cost-benefit analysis. Mostly, if the service satisfies a growing need, then it should result in increasing the sales. Buying an equipment to treat a certain condition, or employing an allied health professional are some ways which many doctors follow to increase range of services.