Assisting my clients with improving the financial efficiency of their practice continues to be increasingly more important each year.
Your practice, like any business, spends money to make money. But how and where you do so involves numerous tactical decisions that can easily slip your notice. Even if you work with a bookkeeper and an accountant, periodically checking your financials will give you a better sense of how your practice is spending its money. All you need is a list of expenses (a detailed version of your P&L statement) and a willingness to think outside the box. If you’re reviewing with the specific aim of reducing your expenses, start with the most significant line items, such as occupancy costs, payroll and insurance, and make note of any ideas that come to mind that could reduce them. Continue this process from your largest expenses to your smallest so that you end up with a list of potential fixes, prioritized by expense significance.
Need a few ideas to get started? Here are some options that could save your practice money:
Maximize your office space
If you have more square footage than you need, you may be able to rent out space to another practice, ideally one that complements your own. Even if you don’t have excess space, consider leasing some or all of your suite to an after-hours clinic when you would normally be closed. What’s more, your tenants could shoulder some of the burden of shared functions, such as utilities, receptionists and even electronic record systems.
Review your insurance
It’s a good idea to get an annual checkup from a respected independent broker. The first consideration is making sure you have enough insurance to cover your risk without paying for coverage you don’t really need. Periodically, get quotes from various carriers to make sure you’re paying the most competitive rate. Research if it’s possible to receive discounts if you hold multiple policies from the same company.
Comparison shopping can be worth the effort. Delegate this task to the most knowledgeable staffer for the assignment, such as a technician for medical equipment and supplies, an IT expert for computer hardware and software, and your practice manager for office supplies. Consider buying remanufactured printer cartridges, gently used (rather than new) equipment, free or low-cost public-domain analogs instead of commercial software packages, and picking up supplies rather than depending on delivery.
These are just a few examples to initially consider. Additional cost cutting and revenue generating options should also be discussed with your healthcare business professional partners.
The financial well-being of your practice is in your hands. Look for those qualified healthcare business professional partners who can help you in this and other areas.
Jeff Holt is a Senior Healthcare Business Banker with PNC Bank’s Healthcare Business Banking and is a Certified Medical Practice Executive. He can be reached at (352) 385-3800 or Jeffrey.email@example.com.
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