Turnover is Costly

I have heard that there is a study by the United States Department of Labor that confirmed that costs to replace an employee could equal 200% of salary. Regardless of survey, we all know the actual and hidden costs to replace an employee. Some costs of unplanned turnover include:

• Departing employees costs (vacation pay and other benefits);
• Advertising for the new position;
• Management interviewing time for the new employee;
• Conducting background checks (driving, criminal, etc.);
• The time it takes to train the new employee;
• The new employee's initial low productivity;
• Unbudgeted overtime for staff covering the empty position while it is being replaced;
• Possible low morale of remaining staff and its related impact on productivity – staff becomes overworked and stressed during this time.

So my question for you is: How is the turnover in your physician practice? If high, what is the problem and how are you going to fix it?

About the Author

Reed Tinsley CPA

This article is written by Reed Tinsley, a Houston, TX-based CPA with over 30 years of experience advising physicians and medical practices across Texas and the United States. Reed holds certifications as a Certified Valuation Analyst (CVA), Certified Healthcare Business Consultant (CHBC), and Certified Financial Planner (CFP), specializing exclusively in the healthcare sector. He is a published author, nationally recognized speaker, and trusted advisor to physicians on accounting & tax, practice management, and financial planning. Schedule a Free Consultation.