Unfortunately, it’s much easier to cut down on expenses than it is to increase profits. But that doesn’t mean your practice must cut jobs or benefits to improve the bottom line and cut costs while delivering quality service. Here are a few suggestions:
Press for timely collections. Customers who pay you 120 days past-due are only dragging down your cash flow. Get your payments sooner. Call patients shortly before their payment is due and remind them of the due date. Confirm that they received your invoice and offer to send another copy of it if they haven’t gotten the invoice.
Push for long-term payments. Ask your vendors to work out payment plans for you. If you spread out the payments over a longer period of time, it reduces your accounts payable amount on your balance sheet.
Access your major cost areas. Most of your office’s costs probably come from one of these categories: labor, rent, inventory (supplies), and equipment. Take a close look at these areas and see if there’s anything you can do to improve the bottom line. If you can save money on things like rent and equipment, you can pump more into the labor and inventory areas, which will ultimately make more money for the company than fixed expenses.
Get quotes on office supplies. Pinpoint what office supplies you buy most often and always need on hand. Contacting three vendors to get bids on only those necessary supplies. Also, if you can get everything from the same vendor, you might save on shipping costs and get easier inventory control. You can apply the same strategy to your medical supplies.
Hire in-house professionals. Accountants, lawyers, research and other professionals can bee expensive to contract. If you find yourself spending money for their services consistently, you might want to consider hiring someone in-house – or suggest it to your superiors.