In the medical practice environment the number one problem we often run into with physicians is their inability to see an expense as anything more than just an expense. The moniker “you gotta spend money to make money” does not apply. They will do everything they can to spend less money. Less money on equipment, less money on staff, less money on maintenance, software, benefits, etc.
It is important, especially in small business, to limit your expenses and to run the business soundly, but there is one major way that the costs you are cutting are actually hurting your ability to make more money.
Employees & Benefits
Doctors that look at their support staff as merely an expense tend to run on leaner staff, asking everyone to do more for less pay. Here’s why that is a problem. Your staff is your BIGGEST asset. They are your advocate. They are your brand. They interact more with your patients than you do by a large margin. So do you want the people in those positions to feel overworked, underpaid, and most of all under appreciated? Your answer should be no.
At one of our practices, Utah Surgical Associates, we make a very concerted effort to provide top of the industry pay scales and benefits. Our new employees start out $1 an hour more than our competitors and our benefits rank in the top 3 of medical practices in the entire state. We do this to ensure we are getting top quality applicants and employees that want to stick around for a very long time. As an added bonus we buy lunch for the staff once a week, keep the fridge and cupboards stocked, have periodic bonuses, and do annual raises.
Additionally, we have hired MORE staff. Specifically in our billing department. But we don’t hire more employees just to hire or make everyone else’s jobs easier. We hire strategically. Three years ago our first move was to hire a patient account manager to work with each of our patient’s individually to be sure their bills are getting paid on time. During that time we have saved over $150,000 in fees our collection company would have previously collected and we collect over $400,000 more annually. Those numbers are well worth the $50,000 or so in salary and benefits we pay for an added employee.
Because of this and other strategies, the company now takes in over $1 million more annually and each of our doctors make $150,000 more EVERY YEAR.
As the moniker goes, it takes money to make money. But ONLY when you are strategic when how you spend it. Should you be better at how you compensate and take care of your staff?
Yes.
It makes a difference.