Here is a statistic. 15-25% of a medical practice expense relates to nurses and admin salaries. But many don’t know that.
So, it is not unusual for a medical practice owner to tell me that “the more staff I have, the more it’s costing me.” and wants to talk about changing rostering etc to keep costs low.
But there are two reasons you need more staff
1. You are growing! And that’s a good thing because then the chances are you may be making more money
If you can keep to 20-23% you are probably doing OK. Anything lower and it’s better.
2. You are not running efficiently so need more people. That’s bad!
This is where you need to take some action because if you recruit and manage the right way you can then begin to leverage your efforts through your staff and systems.
Here’s another statistic.
65%-70% of your medical practice cost will get chewed up in paying doctors.
This plus 25% for wages means 90% of your income is gone. So, it makes sense to focus on getting more out of your doctors, your team and your patient or customer database.
Trying to save money on the remaining 10% will be like trying to clear a $50,000 overdraft by electing not to go to Officeworks to buy paper.
So do not concentrate on things that will not make a difference.
A medical practice will grow steadily and strategically if you have a blueprint of systems and key roles.
Remember as your practice grows it becomes more complex. More staff, decisions, and processes to manage. And that usually means there are more opportunities to make money, but they are lost because there are so many other things happening. It’s the low hanging fruit which is left unpicked and will rot.
Unlike other businesses, you cannot tell your doctors how to operate – but you can guide them. But you can only guide them if you or your practice manager has the information to guide them.
The right foundations and structure for your team is only half the battle. You also need the right technology.
This is where we believe your team can use technology to generate more income. There are software systems such as KPeyes and Cubiko which integrate with your customer (patient) management system and tell where you can make more money. These are systems we believe you cannot afford not to have because margins for many medical businesses are tight.
These software systems can tell you instantly and often in real time how your medical business is doing such as
• Bookkeeping operations – and do them for you automatically
• Automation of doctor payments and invoices
• Revenue by doctor by Medicare code
• Room utilisation rates
• Effect of ‘no shows’ and how to minimise it
• Find opportunities within your database to serve your customers and make money too.
• Help with COVID-19 vaccines and ensuring you receive the PIP payment
We have created a guide for running a Wildly Successful Medical Practice. Click this link to download.
And I would seriously recommend that undertake a demo with KPeyes and Cubiko. It may be the best hour you spend this year because what you will see could blow your mind away.
