If you’ve done a double-take recently when eyeballing your grocery bill, gassing up your car, or pretty much buying anything, you’re far from being alone. Record inflation is a nasty bite out of everyone’s wallets and may have you creatively thinking of ways to curtail your expenses. Consumer prices increased an astounding 9.1 percent year-over-year in June 2022—and it looks like it may be a while before they come back down to planet Earth.
What’s worse is that because inflation is clearly an equal opportunity phenomenon, higher costs are also hitting businesses hard—including your healthcare practice. Let’s take a closer look at the sources of the financial pain, the impact it’s having on your practice, and how you can overcome it.
How is inflation affecting healthcare practices?
It’s no surprise to anyone that higher costs are putting a sizable dent in your practice’s ability to meet its financial goals. And no healthcare specialty has been spared:
- Medical care are up 4.8 percent in 2022
- Dental practices are seeing nearly a 2 percent hike
- Vision practices have seen costs jump 1.7 percent
These higher costs can mean shrinking profit margins for your practice and that’s not exactly a great business model. While a lot of the inflation pain comes from higher consumer prices, it’s not the only culprit. “The Great Resignation” and resulting labor shortages have forced many practices to increase wages to keep minimum staffing levels and avoid high turnover. In some instances, practices are paying 20 to 30 percent higher for some positions to cope with staffing shortages.
Inflation is also taking a toll on your supply costs. For example, personal protective equipment (PPC) costs have doubled or tripled in some cases. Throw in the fact that insurance companies have been slow to adjust reimbursement rates and you’ve got a recipe for diminishing profitability.
How can I turn inflation into an opportunity for my practice?
Though economic conditions are less than optimal right now, it doesn’t mean you can’t elevate and expand your business. Favorable forward momentum in the industry and market projections means that the healthcare sector’s future is promising.
Healthcare is a growth industry and demand for services is only expected to climb in coming years. Spending for healthcare services in the U.S. reached $4.3 trillion in 2021 and experts say that will hit $6.8 trillion by 2030.
But you can turn the corner now and beat inflation by adopting key strategies and technologies to neutralize the effects of higher costs and maximize your revenue. Don’t settle for slimmer profit margins when you can take active steps to ensure your practice earns the return on investment to grow your business and outperform competitors.
5 Tips to Tackle Inflation and Boost Your Practice’s Revenue
1. Increase your per appointment production
In many instances, you can combine billable care and treatments that would normally be spaced out over several different visits into a single appointment. This increases your production rate, opens appointment slots for other patients, and creates more revenue. It also reduces operating expenses like team salaries, practice operating hours, and supply costs.
2. Apply incentive marketing to increase per patient production
Lots of manufacturers are currently offering incentives on their products and services to offset the effects of inflation. You can jump on this opportunity to offer your patients enticing specials on treatments and products such as teeth whitening, deals on eyeglasses, fluoride treatments, or other upsell items. Amplify offers to patients using tools like patient education newsletters and group messaging to educate patients prior to visits to prepare them ahead of time for deals. Leveraging incentive marketing, you can crank up per patient production so that a $350 dental appointment turns into a $450 visit.
3. Re-energize your recall efforts with a digital tool
One of the most effective ways of generating more revenue is to get more patients in your office for needed preventive care, annual exams, and chronic care management. Some may be well overdue for an appointment. A systematic approach to recall using a digital recall tool can help you get patients of all ages back in your practice with minimal time and effort placed on your staff. You can reap an additional $95,000 per year with an automated recall system while helping your patients experience better outcomes.
4. Create easier patient access to bolster accounts receivable collections
Complex payment processes can be frustrating and confusing for patients. Moreover, 85 percent of patients prefer the convenience of making payments electronically like they do for other services. The simple solution is an online bill pay tool that helps you collect outstanding payments quicker and easier by sending patients a text message that includes a secure link to submit a payment with their credit, debit, or HSA card. Get more revenue by making it as easy as possible for patients to pay their bills.
5. Rev up your patient acquisition efforts
Nothing puts a nice drop in your revenue bucket like getting more new patients coming through your practice door. Referrals can be a key source of acquiring more patients and a digital referral tool can help grease the wheels by automating sending invitations to patients that give you glowing scores on surveys. Another productive way to solicit more patient referrals is to make it easier for you patients to share them. Adding “Refer a Patient” links to your practice website and newsletters is an efficient way to grow your patient pool.
Even better, don’t forget all the prospective patients using Google to find a doctor or dentist and the impact you can have in making sure your practice shows up at the top of their search results. Nine out of 10 patients look at reviews when choosing a new practice. Actively managing your practice’s online reputation can help ensure you don’t pass up the opportunity to get more 4- and 5-star patient reviews.
An online review/reputation management tool helps set your practice apart from competitors by automating the process of asking patients to leave you a review. It also helps you track, collect, and compare reviews to ensure you get quantity and quality of reviews to help your practice rank higher on searches. Leverage an online reputation management solution and start seeing a steady stream of more new patients.
Don’t give inflation the room to negatively affect your ability to meet your practice’s financial goals. Adopting proven strategies and reliable patient communications tools can help you overcome many of the setbacks presented by higher costs and propel your organization toward greater profitability and success.