What’s the first step to growing your medical practice, no matter what size it is now?
Imagine you’ve decided to climb a mountain, say something challenging but doable like Mt. Washington in New Hampshire or Mt. Whitney in California. You’re at the base of the mountain and it’s a foggy or even snowy day. You’ve got no trail map to guide you.
What the heck? If you can’t plan where you are going, summiting is going to be challenging and risky at best.
The same is true with growing your medical practice. The first step is to find a map so you can visualize where you are going.
Can you actually grow your practice from startup to profitable, to multi-location and set yourself up for an enviable retirement? The answer is YES!
Here’s how it worked for one ambitious practice owner. In July 2016 Jennifer came to us hoping to grow her single location audiology practice. She had recently started her practice but wasn’t seeing the kind of growth she’d hoped for.
- Be profitable by year 3
- Buy another practice by year 5
- Build up for retirement – she was excited about her goals here
Our team started by setting her up with several of our proven patient-attraction services, adding more as her profits grew. So how did she do?
- Profitable in year one
- In year two, she was making enough to buy a second location
- By year three, both locations were profitable and revenue was continuing to grow
Pretty impressive results and it took just two things; an ambitious practice owner and proven new patient lead generation systems. Put the two together and it equals success.
How can you be as or even more successful than Jennifer? We’ve mapped out ideas for growth for each stage, to help you climb the mountain of success with your medical practice and in turn reap a mountain of rewards.
5 Stages of Success
- Solo Medical Practice
- New Employer
- Steady Operation
- The Seven-Figure Medical Practice
- Growth Company
Stage 1. Solo Medical Practice
This is the startup phase where you personally get to do everything. That includes answering the phone, scheduling appointments, seeing patients and even licking envelopes. Yes, it takes a lot of work to start a medical practice, but the biggest mistake most startup practice owners make is the following.
Once you have a few patients, it’s important to hire on support staff as soon as possible. Even a virtual assistant or part-time front desk staff person can free up your time to see more patients and grow your practice.
It’s true, it can be hard to let go of administrative tasks and no one else can lick envelopes the way you do, but bringing on support staff is essential to getting to stage 2.
Sure, we hear lots of excuses like:
- It’s hard finding good help
- I’m not making enough to hire someone right now
- I can handle all that stuff…I don’t need help.
But until you hire someone, you won’t be able to tackle some of the other big things that get in your way like:
Finding a patient attraction firm (one you can rely on)
Dealing with the insurance companies (which can be a nightmare)
It’s easy to give up and blame the competition for stalled growth, But in truth, the only limits for your practice are ones you set yourself. Of course in order to afford to hire even part-time help, you’ll need at least a modest flow of patients. (And if you need a little help with that, Online Review Builder is a great way to get new patients coming in with minimal investment.)
Key at this stage is to clarify what business you are in. Sure you’re a medical expert, but in your messaging, in your marketing are you focused on you or on your patient?
If you focus on the problem you solve for your patients,
you’ll attract a lot more.
Stage 2. New Employer
You spent years in training to become the medical expert you are. Now it’s time to move beyond your title. This involves moving from working in the practice, to being a business owner and working on your practice, at least to some degree.
Hiring and managing new staff members can feel like you’re jumping out of a plane without a parachute. With each new team member you add, you’re increasing your monthly overhead and it’s true if you’re not careful you could be spending more than you’re making.
A couple of hard earned lessons:
- Before you hire anyone, clarify your values and management principles. If you don’t, you stand a good chance of putting someone in the job who isn’t a fit. Those people can sink your practice. We spent years coming up with our “Un-Managment Principles”, which work for us.
- Hire self-motivated people, give them the training and tools to succeed, and they will.
- Hire slow, fire fast.
The tendency at this stage is to micromanage everything when the real goal is to teach your growing team to think for themselves and avoid trying to be anyone’s boss. Of course it helps if you hire people who can manage themselves to take your practice to the next stage.
The more team members you add, the higher the cost, which is why you’ll need to keep a focus on marketing (attracting new patients). Ientify what makes your practice stand out and come up with a marketing plan. At MedPB we’ve helped hundreds of practices grow and we can help you write and review your marketing plan. Just talk to us.
Stage 3. Steady Operation
At this stage your focus will be on filling out your team, hiring a full complement of front desk staff and adding assistants and another provider or two. At the same time you’ll be fine-tuning your business model and your marketing model to maximize your return on investment.
This is where your practice is making between $400,000 a year and a million, so it can be easy to start patting yourself on the back and become complacent. The truth is, until you’ve worked out all the kinks in the system, your actual profits could vaporize in thin air and you could be out of business.
What can go wrong?
We’ve seen it happen over and over; practices generating almost a million a year in revenue going bankrupt! A practice has solid revenue, but their expenses are more than they are making, so they’re losing money. That’s right! It happens all too often to practices due to:
- Lack of financial management — simply making sure they are earning more than they are spending.
- Not reviewing every single expenditure every month.
- Excess staffing. (Every staff member should be able to define their role or it will take 7 people to do the work of 2.)
- Overpaying for services. (We knew a single location practice paying thousands a month in copier-leasing fees!)
- Tying up tens of thousands of dollars in inventory that was collecting dust on the shelves.
- Giving away services for free or charging fees that earn them next to nothing.
- Lack of billing or follow-up on unpaid bills.
Every practice will have growing pains. But there is a big
difference between practices that succeed and the ones that don’t. The practices like Jennifer’s that continue to grow are always looking for ways to improve. These practice owners and their staff continually strive to take what’s working and make it better.
Their biggest focus is on reviewing everything they do each week and or month to identify:
- What’s working? What should they keep doing?
- What’s not working? What should they stop doing?
- How can they improve? What should they start doing?
Stage 4. The Seven-Figure Medical Practice
Once you have your practice running smoothly, the next step (if you want to take it to the next level) is to scale the business. You’ve already done the hardest part of the job by creating it and getting it running. The next step is to leverage all that hard work to scale it.
It’s a big decision, whether to stay in the business and focus on treating patients, or to step outside of the business to run it and grow it. Either choice is the right one, depending on what you enjoy. For some, the fun comes from talking with patients and helping them return to good health. For others it’s the challenge of growing a team and running a business. Up to you.
Think about it. You’ve built a practice that’s making $750,000 a year. Why not use all this hard-earned knowledge to open one or two more locations and double your income?
Over the years, we’ve asked practitioners what their biggest fear is, whether it’s fear of success or fear of failure. We’re always amazed at how many people’s biggest concern isn’t going out of business or having too few patients, but having too many.
How about you?
What’s your biggest fear?
Either way, talk to us.
We can help.
The primary focus at Stage 6 is fine-tuning and documenting your systems for:
- Monthly Financial Review
- Continuous Improvement
Stage 5. Growth Company
Imagine instead of owning an individual practice with a single location, you now own a healthcare company with ten or twenty locations, or more. Instead of being focused on day-to-day patient care, you’re focused on managing a growing portfolio of practice locations. This could be 20+ audiology locations, or a multi-discipline practice with offices in adjoining towns.
Develop your brand
Regardless of your business model, this is when you get to build your brand and how you do so will determine its trajectory. Ask your management team the questions below.
What do we want patients to associate our brand with?
Review your systems and processes
- Personal communications?
- Excessive and duplicate paperwork?
- Simplicity of online access?
- Treating patients like cogs in the system?
- Talking or Listening?
- A superlative patient experience?
- Medical expertise?
- Red tape?
- An impenetrable voicemail system?
- A used-car sales strategy (yes, we’ve seen this in Google reviews for a surgeon).
Once you’ve dialed into what you want to be known for, the next step is to regularly review each of your systems and processes to make sure they support your goals and your brand.
Some questions to ask each month or quarter include:
- Does your marketing accurately portray who you are, whether you want to be known as personable local providers or the regional experts?
- Does your website and phone system motivate patients to contact your offices?
- Do you have a proven follow-up system to nurture each patient inquiry, to make sure questions are answered and patients scheduled? Or do patients have to repeatedly call to get on the schedule?
- Have you mapped out the patient experience, from scheduling an appointment to your reminder systems, to how they are greeted to the paperwork you ask them to complete? Have you asked patients what improvements they would like to see?
- Is your billing system timely and effective?
Back when your practice was bringing in under a million a year, you the practice owner were in charge of day-to-day operations. As your healthcare company grows from three to ten million, you are still in charge. Successful business owners are those who can let go of being in charge of the day-to-day operations and instead focus on the key task of growing the company.
A clear focus on goals, people and systems solutions is what works.
Questions on growing your health care company? Talk to us.