Opening your own medical clinics or private practice is certainly rewarding. But it can also bring new challenges every day for being a business with significant costs and some unexpected expenses.
In addition to its more obvious monthly costs, such as operating expenses and payment of doctors and staff, there may be a need to periodically invest in training and updating, marketing, business-related travels, and even in the purchase of new and more modern pieces of equipment.
All things considered, sometimes your clinic may need to budget to make ends meet. If you’re trying to cut some costs, follow these tips to avoid unnecessary expenses, especially the ghost of debt.
1. Update Your Inventory
If your clinic has been around for a while, you’ve probably noticed that there are a lot of items in stock that you use very little or never. Take some time to go through inventory to see what you have an excess as this can help you save money on orders in the future.
There are some simple ways to keep inventory smaller:
- Sort Items by Demand– You can avoid large volumes of every item by sorting them into three groups: the most important, the least frequently used, and those you rarely use. That way, you’ll be able to focus on the items that your clinic needs to have in larger quantities.
- Avoid Large Orders– Instead of a large purchase of many items, choose to order smaller and more frequently. This allows you to purchase only the items that are in greatest demand, avoiding overloading your inventory.
- Update Your Inventory– Some older clinics have the habit of continuing to buy some obsolete items that have little or no demand “just in case.” These products have often been replaced by new, better ones. Updating your inventory can eliminate useless items and save money.
2. Utilize RCM
Do you understand what revenue cycle management is? If your clinic can’t efficiently keep track of a patient’s trajectory from the first visit to the billing after a treatment, you may want to better some of your processes.
Revenue cycle management (RCM) is your clinic’s most important financial process, and something you shouldn’t overlook, so consider investing in RCM software. By retiring paperwork and digitizing processes, you ensure a more transparent and error-free billing process, maintain better records and up-to-date patient information, improve the patient experience, and save time and money.
3. Go Back to the Basics
A medical clinic can have a series of extra expenses without even realizing it. How many magazine subscriptions do you pay monthly just so your customers have something to read in their waiting room? What about holiday decorations: do you use the same or buy new items each year?
If you’re trying to balance your bills, this is a great moment to go back to the basics and re-evaluate some of these expenses. Cutting one or two can save money without big sacrifices. After all, you can resume all this once you are more financially stable.
4. Rent Out Extra Space
If your clinic takes up more space than it really needs, you might also consider renting out space for another clinic or professional or even providing some rooms for after-hours classes or training.
Here are some things to note if you intend to rent out extra space:
- Identify the available space possibilities and whether the act of renting it will not interfere with your daily activity.
- Evaluate all extra operating costs so that you can define a fair rental value.
- Consult a professional to check your legal limitations.
- Consider that there are some risks in opening your business space to others (property loss, injury, even theft).
5. Cut Back on Advertising Costs
If you are still investing heavily in traditional advertising (magazines and newspapers, radio, TV, billboards), it might be a good time to step back and save this money using social media to advertise for free.
In addition to being a form of free advertising, social media ads are also easier to manage on your own. You can create a blog and publish articles on healthcare promoting the doctors who work in your clinic. Then link to these articles on your clinic’s social media: Facebook, LinkedIn, Twitter, etc.
Follow the trends in likes and views. If they’re low at first, encourage your patients to interact with the posts and share them, increasing their reach.
Financial Health Matters Too
Starting or maintaining a small business brings a series of expenses and risks, and it is no different with medical clinics. Keeping your expenses under control should be a regular practice, as healthcare is an industry that requires a lot of costs—some of them completely unexpected.
While saving money seems challenging at first, proper planning will show that it’s possible to fit a budget and even save some money when superfluous expenses are cut. Don’t overlook the financial health of your business: it is just as important as the health of your patients.
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