The Road to Financial Ease… Cash Profit Centers
by: Kathy Mills Chang, MCS-P
Reimbursement woes are often at the forefront of chiropractic practices that rely heavily on patient insurance for payment. Many chiropractors find their cash flow dependent on the whims of insurance companies and their ever-changing reimbursement policies that bounce up and down like rubber balls. Trouble is – insurance companies seem to be “dropping the ball” more often lately when it comes to chiropractic care, and many chiropractors are being hit hard by state legislation that negatively affects reimbursement as well.
So, how do you stay proactive, rather than reactive, in the face of all these income-impacting odds that are out of your control? Are there ways to maintain an “upper hand” in the face of the never-ending barrage of changes in managed care and third-party reimbursement?
Some chiropractic coaches and consultants may advise you to switch to a “cash-only” practice before it’s too late. While this idea does have its merits, it certainly isn’t something that you can put into place tomorrow, next month, or even by the middle of next year. However, there are ways to transition your practice to cash that are relatively pain free and that allow you to avoid the sting of constantly changing insurance regulations that take bigger and bigger bites from your reimbursement pie.
Remember the adage – “Don’t put all your eggs in one basket?” Well, that’s what you do when you count on insurance reimbursement to sustain your practice. You never seem to get ahead, even when you add new patients, because you are taking in with one hand and giving away with the other. And if it seems as though you can never catch up, you’re right, you can’t. That is…unless you make some changes.
Most patients’ policies allow for the reimbursement of critical care. Get them better and get them out. However, better does not necessarily equate to healthy, and most chiropractors work with the goal of moving a patient from dis-ease and dys-function to health, wellness and optimal body function.
In order to stay ahead of regulatory and insurance changes, you need to transition your practice from a state of dis-ease to a state of health and wellness.
Take a Look at Your Inactive Files
Come on – we all have them – most of us have more than we care to share. What are you waiting for? Why didn’t those patients convert to wellness care?
In 2004, sales of wellness products and services reached $68 billion. Doctors of Chiropractic are better poised than any other class of professionals to direct the Wellness Revolution. It’s been reported that it costs a business 7-9 times more to acquire a new customer than to retain an existing one. The simple act of educating patients about the importance of wellness care can increase retention and create that wellness profit center that may be missing. An increase in your patient visit average brought about by wellness care can translate into thousands of dollars every month, outside the third–party reimbursement arena.
Increase Internal Cash Profit Centers
There are plenty of ways to increase profit centers within your practice, and it’s a fact that practices that offer products and add-on services have higher gross revenues. Patients expect us to be whole body practitioners and, when necessary, these create cash profit centers that benefit the practice and services to help your patients stay healthy.
Here are some products and services that, when offered in your practice, can create buckets of incoming cash that are not dependent on the whims of third–party payers:
Provide nutritional counseling and supplements to enhance patient health. Even if you’re not a nutritional expert, you can find an easy-to-use line of products to recommend. The combination of office visits with a nutritional focus and the sale of nutritional supplements and refills can provide a big boost to your bottom line.
Pillows, belts, and car seats
Everyone needs a pillow. Why send them to Wal-Mart to buy one? If you subscribe to the philosophy that every neck patient in your practice would benefit from a cervical pillow, make it a part of your recommendations. The same goes for car seats for patients with low back pain.
Spinal Pelvic Stabilizer
We know that 90% of the population would benefit from Stabilizers to enhance their treatment. Together with the ancillary services that are often covered by insurance, an average practice dispensing Stabilizers to only 50% of new patients can see increases of up to $50K in a year.
Did you know that Massage Envy, a massage therapy franchise, earned over $13 million in 2006? Patients will pay cash for massage therapy. Make that available for your patients in your office, and tap into that profit center.
Even at only $12-$15 per tube, items like Bio-Freeze or similar analgesics can really add up. Using the product correctly, a practice can increase revenue by as much as $8K per year.
If you make these services part of the Report of Findings and patient treatment plan, and if the patient understands why they need the service, they are usually willing and able to follow your recommendations. Demonstrate the connection between these products and services and the patient’s condition and care plan, and then you will be well on your way to increasing your revenues through profit centers that are valuable to your patient as well.