6 small business skills for setting up a new medical practice
As a new doctor, choosing to go the independent route by starting your own practice can be an exciting time. The freedom of owning your time, choosing who to serve and how to serve can be a truly satisfying journey. But, having high clinical knowledge does not always guarantee practice success. Therefore, to help you set a solid foundation for your new practice; we’ve distilled and simplified some basic business skills to help you pair your high clinical skills with the correct business skills.
1. Strategic planning:
Before you open your practice doors, it is important to do the groundwork. Strategic planning includes doing market research, identifying what the mission and vision of your practice are, and setting timelines.
- Market research:
It is important to clearly identify what segment of the market you would like to serve; then to take a look at where you are most likely to find this market. Are there any other doctors in the area who are already servicing this market? And how can you get a share of this market?
You might need to find another market, change locations or share rooms with another doctor. You never know until you truly do the research.
- Mission, vision, goals:
The mission statement speaks to ‘who’ you are and ‘what’ you do. How would you define the practice and what is the reason that your practice exists? The vision speaks to ‘why’ you do what you do and ‘how’. Why do you exist? Where would you like to see your practice in a few years; do you want to open up more practices in other areas? Do you want to run a completely paperless practice? How do you intend on getting there?
Your goals are smaller objectives which will help you reach your mission and vision. These can be the number of desired daily patients, to desired yearly income.
Setting up timelines is very important. If you open too soon, you might incur costs such as not giving yourself enough time to market your practice, and therefore not attract enough patients. Taking too long to open might make you incur more costs because of longer equipment/medication storage or start-up costs. The proven sweet spot to opening a new practice is 6 months.
2. Financial management
Managing your finances does not begin with billing; it begins before your doors even open. If you have clarity around your finances before the actual operations resume, you can avoid future financial stress. This is why setting up a budget is important.
- Setting up a budget:
The budget is the minimal amount of money which you must have to initially set-up and run your practice. The budget needs to include at least 6 months’ worth of expenses covered, as well as any marketing and consultant fees.
It is also important to note where these funds will be coming from:
- Have you saved up enough capital to start-up and run the practice?
- Or do you need to hold off before starting up because you need to save up a bit more?
- Do you need to take out a loan?
3. Project management and delegation
It may be overwhelming to think about starting a practice all by yourself. But, from the onset, to decrease overwhelm and to be more efficient, you need to think about where you can source expert help in areas you are not familiar with. Although you are the leader, it is wise to collaborate with expert professionals who will help you manage different areas like the ones listed below:
- Financial & Tax advisor
This is someone who will help you: setup your bank account, your tax certificates, any industry fees, overhead fees, choose an accounting firm/ software, and arrange financing.
- Administrative support
Someone to help you with setting up your business entity, joining industry organisations, advising you on industry regulations and policies, insurance policies and your practice license.
- Legal advisor
This legal entity or person will advise you on your lease contracts and agreements, staff contracts, as well business partner/vendor contracts, and other industry legalities. Having someone to join you in this process right from the onset may help you avoid any costly mistakes in future.
Vendors to consider when starting out:
- The laboratory you will be using
- A medical waste company
- If you are renting, is there a maintenance team for the space
- Medical and office supplies vendor
4. Human Resources
- Hire the right staff
Hiring too many people may result in unnecessary costs but, hiring too few people may result in burn out, overwhelm and errors.
The three main people to consider are:
1. A receptionist to handle the check- in and checkout process, as well as initiate the billing process.
2. A practice manager, to manage the staff, practice and billing.
3. A medical assistant or nurse to assist you with patient care.
It is also important to hire people who can be cross-trained so that if an area outside their daily scope needs their attention; they have the skills to jump in effortlessly.
5. Research & Innovation
From the time that a patient is scheduled in, to the check-out process, technology can help you navigate this journey.
- Avoid paperwork by scheduling the patient into an online calendar.
- Closer to the consultation time, you can mitigate missed appointments by sending automated appointment reminders via SMS.
- During the check-in process, use an online check-in calendar with automated ⦁ benefit checks, so that before the patient even sees you, you are aware of how much of their consultation will be covered by medical aid.
- You can use technology to view the waiting area and how many patients you need to see, by viewing the virtual waiting room.
- During the consultation, you can use a tablet to take electronic notes and to pull up patient history.
- After consultation, the billing process can be automated and thus quicker.
6. Marketing and sales
Now that you have conducted thorough market research, you need to put tactics into place about how you will market your practice.
But there are steps to consider before implementing your marketing tactics:
- Determine how many potential patients you would like to attract in a day or month, and whether you have the capacity to handle this number. If not, reassess to a more realistic number. You can always change the number when you become more profitable and gain more capacity.
- What percentage of the community do you intend on converting into your patients? This will be determined by your market research.
- Many businesses make the mistake of thinking that once their doors are open, the hard work is done. But, as a business owner how can you make sure that you keep giving your patients great service, how can you make sure that your practice systems and processes are efficient?
Setting up a new practice can be exciting and overwhelming at the same time. But, if you lay a solid foundation in the early days, you will have more ease when running your practice. So, take the time to strategically plan what your mission, vision, timelines, and goals are. Pay special attention to your finances. Regularly research and innovate. Set the foundations for a thriving practice by hiring experts. Really take the time to consider your market and how you can create the best patient care.