Healthcare Practices: Lessening the Financial Impact of the Pandemic
The COVID-19 pandemic has had, and will continue to have, a large economic impact, with high unemployment levels and many closed businesses resulting from this time of uncertainty. The effects are rippling throughout the economy — and being felt by medical practices and hospitals. Many physician practices have experienced a reduction in patient volume as patients have lost jobs and no longer have insurance. Even those who still have insurance may be reluctant to have elective procedures performed.
Mitigating the slowdown
In this era of belt-tightening strategies, here are some steps medical practices can take to mitigate the effects of the economic slowdown:
Focus on comprehensive patient care. Physicians need to rethink and reinvent their medical practices to be as comprehensive as possible. This means that physicians should focus not only on the patient’s primary complaint, but also on any “subclinical” issues (issues not severe enough to present definite or obviously observable symptoms) of which the patient may be unaware. Doing so will increase visit value for the patient and the practice.
Appoint or hire a patient care coordinator. Employees in this position essentially act as liaisons between patients and staff to ensure clear communication and facilitate the delivery of optimal care. Part of the rationale for appointing or hiring one is related to the pandemic: It’s important to limit the number of patients in the waiting room to conform with social distancing practices.
The coordinator can, for example, conduct phone interviews before appointments to ensure that pertinent information is entered into the electronic health record (EHR) in advance. When the patient arrives, the practice will already have identified insurance coverage, deductibles and payments due, so the patient can proceed directly to the exam room. These practices are likely to continue to make sense even after the pandemic has ended.
Develop or improve your relationship with your financial professional. During the pandemic, many medical practices have relied on their accountants, attorneys, bankers and medical practice consultants to help them acquire PPP loans and extend lines of credit. Improving relationships with these financial professionals can be beneficial in the long term, as well.
Consider obtaining partners or merging into large group practices. Even before the pandemic hit, there was a rising trend toward group practices and partnerships. Although there always will be a place for the solo practitioner, group practices and partnerships have several benefits, including spreading the financial risk, letting physicians practice medicine while hiring others to run the business side, and economies of scale.
Leverage telehealth. Most studies have found an increased use of telemedicine during the COVID-19 crisis. This generally is expected to continue for the rest of the year — and potentially beyond the pandemic. In a poll taken during the Value-Based Care Summit | Telehealth20, an online summit held in June 2020 to discuss telehealth, 96% of conference attendees (granted, something of a biased population) believed that telehealth’s role will continue to grow in the industry. What’s more, 68% said they planned to invest further in telehealth.
Fine-tune marketing. A downturn is not the time to cut back on marketing, but in the context of an ongoing pandemic, your marketing should be sensitive to patients’ economic uncertainty. In addition, focus on assuring potential and current patients that your practice is accessible and all possible safety precautions are being taken.
The bottom line
In many ways, the bottom line on coping with the pandemic is paying attention to your practice’s bottom line by following all the standard recommendations. These include minimizing overhead, maximizing profits by offering additional appropriate services, and taking a close look at your billing and collections to ensure you’re not leaving money on the table. In short, run a safe, efficient and profitable medical practice.
The question of staffing
Many practice expenses need to be evaluated in a tough financial period, but one of the big ones is staffing. When applying for PPP loans, many physicians had to take a hard look at their payroll. While slashing staff can be a significant cut to overhead, it also can adversely affect your practice — particularly as the economy begins to recover and patient volume returns.
This might be a good time, however, to take a hard look at whether you have too much staff for current conditions or for the conditions you expect when things return to normal — or, perhaps more importantly, whether your existing staff are spending the appropriate amounts of time on the right duties. If patient visits are down, perhaps some of the staff that’s usually patient focused could be shifted to collections or billing. You may need to consider having some staff members juggle roles or outsourcing some duties.