The Women in Medicine Badass RadioshowEpisode #16: What is the Financial Impact of COVID on Your Practice?
Welcome WIMBAs to the show. Today we are going to talk about an important topic: Money! More specifically, I want to shed some light on both COVID-related as well as pre/post COVID-related considerations when it comes to your medical practice’s bottom line and we’ll be taking a look at the impact of circumstances and behaviors on your practice’s finances.
Let’s start by exploring how COVID has affected medical practices.
In 2020, the AMA surveyed 3500 physicians to find out what was happening on the ground. Here are the findings:
More than 80% of physicians said their revenue had declined by over 30%. This was due to two main factors: PPE challenges and a decrease in visits.
If you recall, at the start of the pandemic, PPE was hard to come by. Many medical practices, especially the smaller ones that didn’t have the purchasing power of larger practices, couldn’t gain access to PPE. This translated into sending sick patients to the urgent care resulting in a lower number of patient visits. As an aside, the shortage of PPE didn’t only translate into financial loss. It also meant medical employees were reusing N95 masks more than once, sometimes for a full week at a time, which isn’t safe.
When practices were able to get access to PPE, much of the time it was cost prohibitive. In fact, the AMA found that for ¼ of physicians, PPE spending was up by over 50%.
The silver lining to the COVID pandemic for the healthcare industry was the switch over to telemedicine. This helped improve the financials for practices, especially because of the mandate that insurance companies reimburse those visits at the same rate as in-person visits. And in fact, the percentage of physicians making use of telemedicine went up from 20% to anywhere between 68 and 77%, which is good news. The number of telemedicine visits tripled in 2020, so clearly patients were making use of technology. But even when you account for the increase in these telehealth visits, it didn’t fully make up for the losses in medical practices. A full 70% of physicians said their total patient visits were still below the pre-COVID levels.
So those are the facts.
Now let’s talk about how you can maximize your profitability by addressing some factors that were relevant before COVID started and will be again one day when COVID is no longer dictating the way we live our lives.
The first thing to consider is your business model. I recently worked with a client who was a partner at a private primary care practice. It was the kind of clinic where patients pay a membership and are eligible to get more personalized attention, same-day-appointments, faster response rates and the like. While a lot of medical practices were struggling during the pandemic due to lower patient visits, her practice was exploding. In fact, they were getting so many new patients coming in that they needed to expand to another location. If everyone around you is struggling (think about the findings from 3500 physicians) while your practice is booming, you are doing something right.
Another physician I know has a concierge practice. In addition to offering direct care, COVID testing, and advanced labs, he also offers health and wellness coaching. So patients aren’t only utilizing his services when they are sick. He’s supporting their sleep, fitness, and weight loss goals as well.
Think about how you run your practice and how you might reinvent yourself to increase your bottom line. Give yourself permission to get creative here.
The second thing to consider is how you engage in your practice. Too often, medical practices are overburdened by a high volume of patients. If they are calling to schedule an appointment and are being left on hold too long, they may hang up and this leaves an empty spot on your calendar that could have replaced an available spot. In this case, either find a way to get to the caller sooner or employ technology whereby your patients can schedule their appointments through an app or on your website.
What about when they are in the office? How delayed are you in getting to them? Are you always behind schedule? Try to tighten up the flow and keep patients engaged and feeling valued. This will not only help you retain your caseload, but will increase the word-of-mouth referrals that can help grow your business.
So as you move forward out of the shadow of COVID and into the light, consider what changes you can make to take control of your practice and your finances.
If you’ve come up with additional solutions, please share them in the comments so other practitioners can also benefit.
And if you’d like to get some support as you’re going through this transformation in your business, join My Tribe to Thrive so you can be part of a community of like-minded individuals. You don’t have to do this alone. Go to www.drsharongrossman.com to sign up.
Take care and I’ll talk to you next week.