I’ve worked in various industries. I’ve worked in the grocery business with Nabisco, airline industry with Continental Airlines, I’ve consulted for companies in the travel industry, software, and finance industry.
One of the things that I’ve noticed working in all these different places, is that each company I’ve worked with, has a sentence that starts like this, if only….
The grocery business talks about margins. If only our margins were better, we could really start to do things. If only we could have a floor display next to Coke, we could really sell this SuperBowl weekend. The airline business is all about fuel cost. If only fuel cost didn’t rise, we’d be better off.
In healthcare, we have tons of if only… if only insurance companies would pay us enough, we could be happier. If only we could negotiate better rates, things would be different. If only we could make money on vaccines, I could practice medicine the way I want. If only we could do procedures like ortho pods, I wouldn’t have to see 35 patients a day.
Here is the thing, the grocery business will always have low margins. Airlines are going to have fuel cost issue no matter what. Insurance companies will continue to take advantage of primary care and try to pay as little as they can get away with. And the likelihood pediatricians will start to do procedures is also slim.
So what should we do? How should we go about? What is the alternative?
What if we embraced our if only… and use it as a starting point to develop a strategy? What if we stopped ( ’cause I’m a perpetrator of the if only too from time to time) using the “if only” as an excuse as to why we can’t succeed and instead use it as a catalyst to find a way around it despite the challenges.
For example, grocery businesses like Whole Foods and Trader Joe’s understand that margins are low in the grocery business. Thus they’ve embraced this reality and developed a concept that bring in higher margins.
Whole Foods brings their organic, market food feel while Trader Joes focuses on items we normally don’t see in the traditional stores. Another example is SouthWest Airlines. As a result of high fuel cost, the airline has developed an infamous fuel hedging program that has become part of their competitive advantage.
What can we learn from Trader Joe’s and SouthWest Airline?
Pediatrics is also a high volume low margin business. That is why it is important to scrutinize every expense, and code for every dollar worked. Because margins are low, we have to make sure every doctor is coding appropriately. Because volume is high, we have to tirelessly find ways to become more effective and our staff has to become more efficient. Because patients have high deductible plans, we have to ask for credit cards to be placed on file so we don’t continue to increase our A/R every year.
Because insurance companies want to pay as little as possible, we have to make it part of our strategy to stay on top of these issues.
Now, I’m not suggesting to give up on fighting for better rates from the insurance company or conforming to the possibility that you will only have to see 40 patients a day to make ends meet. I’m not talking about giving up. I am talking about using some of these hurdles as ways to redefine our businesses like SouthWest and Whole Foods have.
A perfect example of this in our office was this notion of asking people to leave a credit card on file for accounts that are more than 90 days delinquent. This policy came as a result of higher deductible plans and the economic downturn in the US.
I could have used the higher deductible plans, thus higher A/R as an excuse. If only people didn’t have high deductible plans, we would be better off. Instead, I realized that the higher deductible plans and economic downturn is the way it is going to be. Thus, I needed to embrace this reality and use it in a way that will help me develop a strategy or policy that will help me overcome this issue.
Stop using the only if as an excuse and start using as an ingredient for success in your practice.