:dropcap_open:O:dropcap_close:ften times we have the misconception that success is something we enjoy only after we master difficult concepts and complicated theories. However, it may surprise you to know that you learned some of the necessary skills required for a successful chiropractic office when you were in Kindergarten.
Do you know your numbers? If you don’t, then reading this article and implementing its message can turn your practice around. It’s really as simple as One, Two, Three!
The failure to keep proper statistics is a weak area among most chiropractors for two reasons. The first reason is because there are plenty of other details in the practice that keep the doctor too busy to focus on their numbers. Secondly, if doctors do not know how to analyze their statistics, they fail to understand how important it is to know them in the first place.
Knowing your numbers will increase production and profit without having to increase any aspect of budget or overhead. Read that last sentence again. Keeping detailed monthly statistics in your practice does this by allowing you to correct mistakes (or avoid them altogether). It helps determine how much you should charge for services, if more staff training is needed, and guides you to an exact dollar amount that you should spend on marketing.
If you’re not keeping proper statistics, our guess is you are losing a ton of money. Doctors tell us all the time that they know what is going on in their office because they’re always there. However, once they start “learning their numbers,” they see a completely different situation than what they originally thought.
Here’s a million dollar formula on patient visit statistics that won’t cost you dime! To determine patient visit statistics, take your monthly overhead and divide that number by the number of patient visits you’ve had that month. The result is the amount that each office visits costs you. (Yes, YOU! Every time a patient walks through your doors, you’re paying something; don’t you want to know how much?)
:dropcap_open:If you know your numbers, you know it’s about practicing smarter, not harder.:quoteleft_close:
Compare the resulting number to the amount you’ve collected per visit that month in your office and see if each visit is profitable. For example, we recently visited with a doctor whose overhead is about $5,000 a month. During the month of December, he had 200 patient visits. That means each patient visit cost him $25. (We’ve shown thousands of doctors how to do this and the surprised expression on their faces when they see the results tells us that they’re stunned to see how little their actual profit per visit results in actual profit.) One had a very insurance dependent practice and would get as little as $10 from the insurance for adjustments. He was actually paying the patient $15 to come to his practice!
Listen, if you want to take care of patients out of the goodness of your heart and pay them to receive your services, that’s fine; but you’re not going to make a living that way!
If you know your numbers, you know it’s about practicing smarter, not harder. We’re not impressed with collections until we know these statistics. We can’t tell you how many doctors we’ve worked with that were paying patients to visit their clinics! Don’t confuse motion with progress. Profitability comes down to what you’re really making after overhead is figured in and, if you’re not keeping monthly stats in your practice, then you don’t know what that number is. Just because you’re seeing high numbers of patient visits doesn’t mean that your overhead is low enough to net you some profit. If you don’t know your numbers, you’re not going to know how low your overhead should be, or what you should charge, or whether or not to spend money on marketing, etc. You have to know your stats, so you’ll know how to proceed.
To revise a statement coined by former President Bill Clinton’s campaign strategist, James Carville, It’s the profitability, stupid!
Use the skills you learned in Kindergarten. Know your numbers, then you’ll better know what decisions to make in every other area of your practice. Don’t continue to make weighty financial decisions based on faulty thought patterns, rather than factual statistics. What is it they say about insanity? Don’t do the same thing over and over and expect different results. Making a small change in your practice today can add up to BIG results (and profits) tomorrow!
by Tom Owen III, and Todd Osborne, D.C.
Dr. Todd Osborne, a 1989 graduate of Palmer College, ran a successful high volume multiple doctor practice, and is currently Vice President of AMC, Inc., as well as an author and lecturer. Visit www.amcfamily.com or call (877) AMC-7117 for more information.