“5 Steps To A Successful Private Medical
Practice Business”
Physicians, tell
me truthfully! Are you one of those doctors
who chases windmills? Do you believe in the
precept, “If you begin a medical practice
anywhere, patients will come and your medical
practice will flourish.”
If so, don’t be
embarrassed by that idea being jammed into
your brain for decades, and now realize it’s
far from the truth. A successful medical
practice is a small business, functions as
a business, follows all the parameters of a
successful small business, is maintained as a
business, and grows as a business. So why is
it that 95% of medical doctors fail to realize
this fact—or if they do, they totally ignore
it and hope for the best?
It’s a shame to
look at all the older doctors like me who have
spent all that time and money on education and
medical training only to end up with
suboptimal medical practices they hang on to
with tenacity thinking, “It’ll get better
soon” and never does. At the opposite end of
the scale are medical students who have no
idea that a medical practice is a business
that sells medical care to its customers.
Medical
practice business is not about a doctor
seeing patients and providing medical care.
It’s about a business that stands on its own,
has people in it that are employees, or
technicians that provide health care services.
And that, my friends, is the ultimate truth as
to why almost all doctors fail to reach their
maximum potential for income and enjoyment in
life. If you can’t quite get my point, remain
skeptical about my admonitions, and need to
hear it from other experts, I recommend you
read what Michael Gerber has to say about it
in his 30 year summary of working with
doctors, “The E-Myth: Physician.”
Since we are
going to now look at the most important issues
concerning the business of medical practice
and why it usually doesn’t measure up, keep an
open mind.
1.
A
business separates goals from functions:
A business is successful when all of the
individuals in it are dedicated to performing
their required jobs to perfection and
understand that they all work, improving
continually, towards growth of the business.
It’s not about improving the doctor’s income
and his staff hoping to get a raise.
It’s about
understanding that great things happen when
coordinated efforts by everyone there results
in tremendous expansion of their patient load
and income for the medical practice.
A mind-set that the medical staff works for
the business, not
the doctor.
2.
Physicians must readjust their thinking:
Sure,
doctors want to be the kingpin in the practice
and make all the decisions. After all, it’s
only there because of them—right? Inevitably,
what happens next happens to all small
businesses. When the doctor discovers he
can’t do everything in the practice, he relies
on an office manager to keep employees in line
and the office
running well.
Then the doctor can do what he is supposed to
do, see and treat patients. A doctor wants to
be an entrepreneur but loses control of his
office business because he is too busy to make
sure the bills are being paid, patients are
being treated well, and each member of the
staff is happy working there. Most
physicians never take the time to actually
know how their
business is doing—other than seeing the
monthly report from the CPA.
Employees come and go
frequently for many reasons. Usually,
what happens is that one of the other
employees takes over the job, and is now doing
two jobs for the same pay. The work effort
decreases. Practice slows down. The doctor
must get involved more in the business part
taking away from his time with patients—or
staying late in the office to get it all
done. During all this process the practice
income drops to the point where it can hardly
pay the bills anymore.
It may take a year or two before the office
gets to this point. Since the doctor
and staff are overworked, tired, and stressed,
this is the usual point when the doctor closes
the practice and moves elsewhere. You’ve seen
it happen many times in your community. All
for the same reasons.
A few doctors hang on, put up with the
recurrent problems, low income, unhappy
employees, and simply decide to accept things
the way they are for the next 30 years.
3.
Understanding the dynamics of money:
Money can be income, profit, flow, or equity
says Michael Gerber. Everything in the
medical office can be done more efficiently,
more effectively, and more smoothly. Getting
right down to the exact details of every
small business office income and expense item is the only way
a physician can evaluate how his practice is
doing with any degree of accuracy.
Medical practice equity is rarely understood
by doctors and yet is probably the most
critical to his business success. It’s what
your practice is worth to someone who wants to
buy it. And, your practice must be understood
as your “product”—not your services. Patients
expect that your business needs to be there
24/7, whether you are there or not.
You must have your medical practice business
be there and available whether you are present
or not! It must be setup to function
independently of
the physician (yourself).
4.
Provide a business system for your office:
Successful businesses, such as
McDonalds, can be compared to a “turn-key”
system. Everything in every franchise is done
exactly the same everywhere. If you have a
detailed list for every job in your office,
any newly hired employee for that spot knows
exactly what they are expected to do—and you
eliminate the troublesome job of trying to
train them.
The system you develop is the secret to
your ultimate success. While you are on
vacation, or at medical meetings in another
area of the country, new patients are joining
your practice, your office jobs are being
maintained properly, and the usual functions
of your office continue. You never want to
entertain the idea that, “when I’m away, we
don’t make any money.”
The problem for most physicians is that the
system has to be in place at the start of
the medical practice for it to work
effectively. If you implement a new system in
your present practice, it’s almost necessary
to start with a new group of employees.
Breaking down the mind-set of old employees as
well as their habits they have developed
working for the old you just doesn’t work
well.
Relegate yourself to being a
doctor-as-employee—
not
doctor-as-owner.
5. 5.
Business Plan is the initial step:
The
foundation for your successful medical
practice begins with a practical sound set of
dreams and goals for your medical practice
business. The fallacy of starting a medical
practice and then deciding where you want to
go with it doesn’t work, as a whole bunch of
medical doctors find out eventually.
Once your vision of where you want to be in 20
or 30 years is clear in your minds-eye, it’s
just a matter of completing the blueprint and
setting up shop.
Sure it may change over time. So, you must
extend your blueprint in another direction.
6. 6.
(Bonus)
Marketing is the glue to hold the system
together:
Unless you are already a medical doctor
celebrity, you must have marketing strategies
as part of the planning strategies.
Successful businesses require it.
Understanding what marketing is all about at
the beginning means doing some studying and
research.
Patients have to know you are available, where
you practice, what you are trained to do, and
what you provide that patients need or want.
You do that through marketing strategies and
tactics.
As you can see
from what I have described, the whole approach
is the opposite of what is traditionally
accepted for medical practice. The mistake is
to start at the bottom, as most do, and look
up instead of starting at the top and look
down at the business structure of medical
practice as you know it.
I want to burn
these thoughts into your mind so you will
never forget to consider them when you reach a
point where enlightenment of your left
brain dominates.
And, yes, there’s much more about these
factors you’ll need to know and understand.
That’s exactly what I intend to teach you when
you’re ready.
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"Medical Practice Marketing News"
Curt Graham, M.D., L & C Internet
Enterprises, Inc.