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Top tips for a profitable practice

Money saving tipsAt a time when general practice continues to be squeezed financially, practice managers are having to work harder and harder to maintain – let alone grow – profitability. The major issue for practice managers when it comes to practice profitability is that both income and expenditure are hard to control as there are so many variables involved. So how can PMs ensure profit is maintained and enhanced? The answer is the same as it is for any business – to cut expenditure and increase revenue.

Staff costs

One of the biggest costs for any practice is staffing, so it’s worth conducting a review of staff to patient ratios. We’ve written a number of popular posts on the Practice Index blog on this subject recently – click here to see more.

Staff skills

The business world puts huge emphasis on ensuring the right people are doing the right job. Practices should be no exception. Therefore doctors and practice nurses should be involved in clinical rather than administrative procedures. The appointment of healthcare assistants can reduce the number of simple clinical procedures being carried out by experienced GPs and practice nurses. Examine all areas of practice activity to free up administrative time, allowing your doctors and nurses more time with patients. Phlebotomy, smoking cessation, vaccinations, asthma checks, INRstar and so on, can all be done by trained healthcare assistants, as can health advice and simple procedures such as blood-pressure checks. The appointment of an in-house pharmacist could also pay for itself through more efficient medicines management.

Use technology

What software can ease the admin workload? Could digital dictation save time? Can you communicate better via social media? Automation can be well worth the investment. Plus, did you know that switching to laptops rather than desktop PCs will save around 85% in electricity on their running costs over their lifetime? We had no idea either!

Shave costs

Eliminating waste, reducing unnecessary telephone calls, lowering gas/electricity bills or saving staff cost by covering for an absent colleague will be invaluable in your fight to maintain profitability. Especially if that means avoiding the expensive hiring of a locum. Buying groups can help reduce the cost of purchases, as can investing in solutions-based offerings such as managed print services, where you pay per page printed and have print consumables delivered automatically as and when you need them. This saves money and reduces admin time.

Stock control

Whilst control of stocks of drugs, dressings etc tends to be good within dispensing practices, it is sometimes less so for non-dispensers. In most practices the responsibility for ordering stock is often given to clinical staff, who will not always appreciate the financial implications of having money tied up in stock.

Control of administrative stock

In addition to medical stock, another area where tighter control is needed in all practices is with administrative stock, such as stationery and other consumable items.

Increase revenue

There are a number of ways that practices can maximise revenue. Rather than listing them all here, head along to a previous blog on this subject, which can be found here.

Take advantage

GP practices have a captive audience that they can easily sell to – those in waiting rooms. OK, revenue streams such as vending machines (offering healthy foods, of course) have their downsides but what about charging for advertisements, or video commercials on the now ubiquitous TV screens? Local businesses may well be prepared to pay for space. And don’t forget to advertise additional practice services too.

Customer service

A great proportion of practice revenue depends on the registered list and the money this brings in. Therefore it’s worth remembering that practices need to work to retain patients (customers). The first point of contact is the receptionist so they need to be welcoming and helpful. Waiting rooms are the next area of interest, so they need to be inviting and comfortable.

Prioritising phone calls or admin tasks over welcoming patients can potentially lose the business of customers and the income they attract. Touchpads can, of course, ease the pressure here. It’s also worth noting that some practices have one receptionist to meet and greet, while administrative and telephony duties are removed to the back office.

Cut the unfunded services

The BMA’s recent guidance on managing practice workload suggested that unfunded service provision is a ticking time bomb, both for workload and profitability. Londonwide LMC’s medical director Dr Tony Grewel has been quoted as saying that as much as 20% of a practice’s workload could be the provision of unfunded non-core services. Therefore it may be time to take a long look at what services your practice provides. Be tough – this is a business after all – and start insisting other appropriate providers provide the services, freeing your staff up to make money for you.

Benchmarking

Do you know how good you really are and where you can improve your profitability? Getting together with other practice managers to compare figures can be enlightening and provide real insight into how you’re doing. Discussions might also throw up ideas of how you can share resources in order to save money.

Practices do face a struggle to maintain and grow profitability but, as the above examples show, there are numerous methods that can be used to look after the pounds.

We would love to hear how you’ve saved money and increased your revenue, either by commenting below or by posting on the Practice Index Forum.

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Practice Index

We are a dedicated team delivering news and free services to GP Practice Managers across the UK.

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