In the private practice world, mentioning profit or revenue is almost prohibited as if it was a kind of taboo.
I remember being a little taken aback when people in the healthcare business would talk about “profit” and they would lower their voices and look around and whisper the words “making money” to ensure nobody outside of our conversation heard the money reference.
In our practice, we take a completely different approach. In our practice, we don’t apologize for our pursuit of profitability.
We are very upfront with both patients and our staff about the need to be profitable.
We view “profitability” as a responsibility.
Why? Because a broke doctor doesn’t do anybody any good.
Profitability allows the practice to hire the best docs, hire the best staff, buy the best equipment, send staff to training, pay for docs’ CME’s and all the other things that go along with ensuring patients receive the best medical care possible.
Top notch medical care is expensive.
We believe so strong in this, that in our practice, we discuss profitability in practice’s core values document. Here is an excerpt from our company’s charter:
In order to carry out our mission, we recognize that every staff member must take every opportunity to decrease cost, to increase efficiency, and earn revenues that support our team, our practice and our patients.
In today’s health care climate, practice employee must be comfortable with talking about money. They need to know that not only is it okay, but a necessity.
Thus, I suggest it is important to “bake” revenue into the culture of the practice.
Fundamentally, this approach sets the expectation. Employees understand that collecting copayments and balances at the time of service is vital to the practice’s mission.
By openly talking about money, employees understand that the money that comes in to the practice isn’t the doctor’s money, but it is everybody’s money. Collecting from both insurance companies and parents is where the practice gets the money to pay everybody’s salary.
In primary care, this is even more critical because we are in a low margin, high volume business.
And it isn’t just collections. Keeping down cost an unnecessary expenses is just as important. In pediatrics, for example, drawing up vaccines incorrectly, dropping a dose on the floor or simply keeping poor inventory can make the difference between profitability and loss.
Want to avoid revenue leaks an increase profitability? Start talking about money.
Embed it into the practice’s culture.
Please don’t misunderstand me with this point. I’m not suggesting that we only think about money. That is not what I’m suggesting. After all, we are still healthcare providers and things like empathy, caring, understanding, healing, compassion and sacrifice are all part of what we do day to day.
But what I am saying is that if there isn’t enough “margin” docs and their staff won’t be around to be empathetic, caring, compassionate and heal patients. In other words, we can’t help people in need if the practice is also in need.