Like every business, medical practices face the same challenges of operating profitably while also delivering the highest quality of service. From cash flow to capital, unlocking opportunities also comes with associated risks.
Thankfully, the success rate of new medical practices is higher than that of most other industries and the outlook for the medical industry in Australia is very positive. However, misaligned expectations in the first years of operation can leave many clinics exposed to the financial consequences of an under performing business. This can involve underestimating overheads or overestimating profit margins.
For those embarking on the journey of establishing a new clinic, it is important to know that with the right planning and decision-making processes in place, improving or even doubling your medical practice revenue within your first three years is very achievable. There are many strategies that can be applied to significantly boost the revenue of your medical practice within the crucial first few years of operation.
The most important areas to concentrate on to achieve this milestone are having a considered and proactive approach towards:
- your patients and the demand for your services
- your strategic business imperatives and desired outcomes
- your systems, technology and team
How to increase revenue in a medical practice: 7 strategies for success
1. Seek quality advice
Seek out experienced mentors or advisors wherever possible to assist as you plan and forecast the financial future of your clinic. As competing priorities and new patients take up more of your time, it’s crucial to focus on where your medical expertise is most needed, while engaging trusted advisors to assist you in your strategic and financial planning.
2. Goal setting
Set a combination of realistic goals, and ambitious stretch goals. This allows you to focus first on what is most important to the success of the business while also laying out a clear progression plan for future success. These goals need to be reviewed regularly, ideally as part of your strategic planning process. It is also important that these goals be compared to benchmarks (either your own, or those of the industry), and are well documented so you have a clear record of your targets and a way to analyse how you’ve performed over time.
3. Aim for value
Look to champion value-based, rather than volume-based care. Your patients are your most valuable asset so making sure they receive the highest quality care and experience is fundamental to the success of your medical practice. In the long term, a focus on value-based care will be more rewarding for both your patients and your business.
4. Build an online presence
Ensure your clinic has an easily discoverable online presence. This will increase awareness among new and existing patients as well as other healthcare professionals that make up your patient's care team. It is also important to ensure your clinic website is optimised for mobile as the latest Nielson Digital Landscape Trend Report indicates that more than two-thirds of all Australian online sessions are now conducted via mobile devices compared to just 33% by desktop devices.
5. Understand your level of efficiency
Make sure you have an understanding of your clinic’s common tasks and activities, such as registering new patients or requesting pathology. This allows you to track all your clinic’s core processes and uncover opportunities to improve or automate workflows. A thorough audit and clear documentation further equips you to identify areas of inefficiency and action improvements.
6. Improve point of service collections
Overdue payments can be a major problem. As well as being an administrative burden, they can lead to crippling cash flow issues. Training, technology and improved processes will all contribute to better POS collections, ensuring you remain cash flow positive.
7. Take advantage of supportive technology
Finally, ensure you invest in supportive technologies. Modern, cloud based practice management platforms are far superior to legacy, server based systems. With a full suite of easy to use clinical tools, inbuilt voice recognition and seamless third party intergrations, they can improve your administrative efficiency while helping to deliver higher levels of patient experience.
Over to you
Boosted financial outcomes are just around the corner. By championing improvements in efficiency, adopting advice from trusted experts, investing in innovative technology and transitioning to a value-based care model will ensure your clinic is set up to succeed.
We have explored the key principles of building a successful medical practice in our new five-part eCourse. Enjoy our email series delivered fresh to your inbox, packed with insights and actionable takeaways that will help you pave the way to long term success.
Clinic to Cloud does not provide tax, legal or accounting advice. This material is for informational purposes only and is not a substitute for independent professional advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction. See the Clinic to Cloud Disclaimer for further information.
