Yesterday, I kicked off a series that gives readers a peak at some of the things our practice has been doing in order to stay strong as a practice and more important, as a business.
The posts are motivated by seeing a lot of experts online recommending how to do things better, yet never really providing practical examples of their recommendations. I’m not suggesting medical consultants and experts don’t have good ideas. I just like to hear practical examples to help me put into perspective how I may implement a suggestion or recommendation in a busy medical practice.
A little disclaimer, I’m not suggesting with this post that I’m an expert either. Just a practice manager trying to run my business a little better.
But I do have practical examples. So here goes my second post in the series, sharing the practice management love.
Looking for ways to Reduce Cost
Lately, it seems I’ve been looking at how much things cost a little more than before. Managing cost is a business principle, but in times like this, cost is even more essential. Consequently, I’ve been more proactive in bringing in vendors and discussing pricing. I’m usually very open about showing how much I pay for supplies, vaccines and things like that. The purpose is to try to get competing vendors to match or beat prices.
One area I spend time on is vaccine cost. Strictly from a business perspective, vaccines are a thorn on my side. If you manage a pediatric practice, you know what I’m talking about. But we have to have vaccines, thus learn how to manage them.
About a year ago, I created a vaccine analysis in Excel that helped me determine how we are doing with our vaccines. I’ve read before that many pediatric offices lose money on vaccines and others profit from them and for the longest time, I admit I didn’t know which side of the argument I was on. So I created a vaccine analysis to help me scrutinize cost, reimbursement, profitability and many other things. Furthermore, if there are changes, like price increases, all I have to do is update the file and the sheet will tell me how the adjustments will affect our bottom line.
(I’d be happy to share with you my vaccine analysis if you post a comment on my blog. I have a template in Excel that I modified from another template my friends at http://www.pedsource.com/ posted on their site courtesy of Jerry Freed, D.O., South Tulsa Pediatrics, PLLC. By the way, Pedsource is free to join. I encourage you to go right now and sign up.)
What do I do with the data I generate from the vaccine cost analysis Excel sheet?
I’ve sat down numerous times with GSK, Merck and Sanofi/Pasteur representatives and discussed at length pricing, cost, reimbursement, inventory management and vaccine cost reduction programs (group purchasing, Vaxmax, prompt payment discounts, etc.) available to us.
The vaccine cost analysis helps me know I’m managing our vaccine usage well, but also helps me know I’m getting the lowest possible cost on those expensive vaccines.
Group Purchasing Organizations
In addition to analyzing cost, joining group-purchasing organization is a great way to decrease expenditures. Our practice works with CCPA and Amerinet but there are many out there. GPO’s are a great way to reduce your cost. If you are not part of one, find one. Here are three to get you started:
National Discount Vaccine Alliance
Atlantic Health Partners
Comfortable & Distracted
Looking for ways to reduce cost seems like a no brainer. But as practice managers we often get comfortable or maybe even distracted by day to day things. My point is, don’t get comfortable and don’t get distracted. There is always an opportunity to find ways to reduce cost.
Of course, these are just a few examples of ways to reduce expenses. If you have a few moments, share your ideas on how your practice saves money.
For my next post, I’m going to be talking about reporting, data analysis and finding ways to look at our business differently by running reports.