4 Cash-Creation Tactics for Physicians in Private Practice
By: Doctor Janitorial
Tags: Business, Money, Doctors, Healthcare, Medicine

I’d like to begin by saying thank you.

Does this passage look familiar?

“I will respect the privacy of my patients, for their problems are not disclosed to me that the world may know. Most especially must I tread with care in matters of life and death.

If it is given to me to save a life, all thanks. But it may also be within my power to take a life; this awesome responsibility must be faced with great humbleness and awareness of my own frailty. Above all, I must not play at God.

I will remember that I do not treat a fever chart, a cancerous growth, but a sick human being, whose illness may affect the person’s family and economic stability. My responsibility includes these related problems, if I am to care adequately for the sick.

I will prevent disease whenever I can, for prevention is preferable to cure.”

It’s a modern version of the Hippocratic Oath. Physicians and healthcare professionals all over Florida, throughout the United States, and across the planet are risking their lives and their families lives to uphold this covenant.

If YOU work in healthcare, THANK YOU.

Whether you are a humble surgeon, or a proud receptionist, I thank you.

If you know someone who works in healthcare, thank them. The unified response by the healthcare professional community to battle the threat of COVID-19 is truly inspiring.

With no vaccine to heal patients, physicians and supporting staff are waging battle against Goliath with what feels like a slingshot and rocks. And yet, every day, they return to the battlefield.

The number of confirmed COVID-29 cases has reached 304,826 in the United States, according to the CDC, as of the time of writing this on Sunday April 5th.

The count was 62 on the first of March.

JE-SUS.

In a valiant effort to prevent the spread of COVID-19, physicians have been scrambling to Facebook groups and other private forums to share information with one another and recommend healthcare treatments for COVID-19 patients.

But there is one topic that has not been discussed nearly as much in the healthcare professional community right now:

Money.

Here is the harsh truth: Healthcare is a business, not a charity. Why? Because you cannot serve your patients if:

You don’t have money to meet payroll.

You don’t have money to pay rent to your landlord.

You don’t have money to pay your practice-acquisition loan payments.

You don’t have money to pay your student loan payments.

You don’t have money to pay your insurance payments.

A healthcare facility is not just a place where patients go to get healthcare services. A healthcare facility is a business that must make money at the end of each month if it hopes to continue providing healthcare services.

Keeping your patients and your staff safe from contracting SARS-CoV-2 is a clinical challenge. Collecting revenue and meeting your payroll is a business challenge. They are related, but both challenges have distinct characteristics that require distinct solutions to solve them.

You cannot serve patients if you cannot meet payroll.

I understand that money is a taboo topic. Because as a healthcare provider, you are trained to provide healthcare services without considering a patient’s ability to pay for those services. But the very real patient-doctor equation is this:

👩🏽‍⚕️🩺 ➕ 🤒💵 ➡ 😊👩🏽‍⚕️

Remove money out that equation and you’ll get this:

👩🏽‍⚕️🩺 ➕ 🤒 ➡ 😊

Yeah, doctors aren’t going to stick around if they don’t get paid. And if doctors aren’t around, they can’t serve patients. So if we want doctors to stick around to serve patients, they need to get paid.

Many medical practices have closed their doors and are no longer performing elective cases. Unsurprisingly, the revenue that they would expect has drastically fallen. Some of the hardest hit are opthamologists and dentists who have been asked by the CDC to postpone patients’ dental and eyecare appointments. Many doctors have already laid-off some of their staff. Some have requested due date extensions for their rent and even contacted their creditors for additional financial relief.

But these are all cost-cutting decisions.

What about some cash-creation decisions?

If you’re a practicing physician, busy office manager, or another healthcare services professional whose paycheck rests on the success of a healthcare facility, you will want to keep reading.

I have some cash-creation decisions that you can make right now that can help your private practice today.

1) Time to benefit from all those taxes you’ve been paying.

The Small Business Administration (SBA) is offering various programs that are available to small business owners to help them during this pandemic. Physicians that own their own practice are small business owners, and thus, may be eligible to benefit from one or more of these programs. These programs include:

Paycheck Protection Program

Economic Injury Disaster Loans

SBA Bridge Loans

SBA Debt Relief

I’ll go into some detail about each of these programs, but if you want more info, email me at friday@doctorjanitorial.com or send me a message right here on LinkedIn. But keep reading for some general info.

Paycheck Protection Program

If you’re a receptionist, office manager, or supporting staff in a private medical practice, you’ll want to tell your doctor about this. Because it’s literally YOUR MONEY lol.

The program aims to help small business owners with payroll costs and other costs too. Some of these costs can be:

Payroll to employees

Interest payments on mortgages

Rent payments to your landlord

Utility payments to your utilitor

By the way, my use of the word utilitor is completely incorrect. It’s used in the latin phrase caveat utilitor which means buyer beware. A legal jargon phrase apparently.

Just think of all the people who are going to skim this article and read utilitor and think it means utility provider 😂

By the way, making myself laugh is a very important goal I have every time I write these blog posts.

Anyway, back to the topic.

Paycheck Protection Program loans are backed by the Small Business Administration (SBA) but you have to go through a bank or SBA lender to get the money. So talk to your friendly neighborhood banker about this to take advantage. If you don’t know a banker, email me and I’ll connect you.

Economic Injury Disaster Loan (EIDL)

So if you’re a business and you are experiencing temporary economic difficulties (which is pretty much all self-employed physicians), you can get a loan advance of up to $10,000. Which is probably not a whole lot of money for a medical practice, but it’s something.

To get these funds, you apply with the Small Business Administration on their website.

SBA Bridge Loans

A bridge loan is money that you get right now while you look for a more long-term source of financing. In short, it’s short-term money.

Bridge loans come in all different flavors and interest rates, toppings and financing terms, but this website does a really good job explaining the menu of financing options that may be available to you as a SBA Bridge Loan.

Now on to the last government-sponsored program.

SBA Debt Relief

If you have any current 7(a), 504, or microloans with the Small Business Administration, you got some points on the board this month. Because the SBA program is paying every penny of your payments on these loans for 6 months.

So those are all the ways the government can save you. But you may not even need the government’s help because you have some extra money right under your nose that you could cash in on right now.

Yes I did. Keep reading for more money.

2) You forgot about your tens of thousands of dollars in accounts receivable.

COLLECT.

Which one is better at a time like this? A tax write-off? Or real cash dollars?

I found this two-minute video on Twitter of a fellow physician explaining the value of working on on these two reports:

Outstanding Insurance Report

Patient Aging Report

Listen to her and don’t listen to me. She explains it way better than I could write it. Don’t leave that money on the table!

3) The future has arrived (kicked in the door) and her name is Telemedicine.

Never heard of her? Allow me to introduce you.

Here is the overly verbose, jargon-rich definition of telemedicine as defined by our friends over at the Department of Health and Human Services:

“The use of electronic information and telecommunications technologies to support and promote long-distance clinical health care, patient and professional health-related education, public health and health administration. Technologies include videoconferencing, the internet, store-and-forward imaging, streaming media, and terrestrial and wireless communications.”

In short, telemedicine is delivering healthcare to your patients via smartphone.

Tbh, in 2020 this should be a normal thing. If I chip my tooth, do I really need to go to the dentist to ask that dentist what to do about my chipped tooth? Can’t I just message her a picture of my chipped tooth? And then schedule an appointment to fix my tooth?

Science and Innovation, 1925

In 1925, the magazine cover of Science and Invention showcased a physician communicating with a patient via radio.

Who would’ve thought that the catalyst for widespread use of this technology would be COVID-19 in 2020 nearly 100 years later?

But alas, the Center for Medicare & Medicaid Services (CMS) will now cover 80 healthcare services that can be delivered through telemedicine!

However, almost half of all seniors do not have a smartphone and nearly 1 in 10 don’t have a cell phone at all. Furthemore, 1 in 10 seniors that get COVID-19, who are 85 years and older, will perish from this disease.

Like I mentioned earlier, you need money to perform healthcare. And so telemedicine is a way for many doctors to keep bringing dollars in so they can erase SARS-CoV-2 out. Telemedicine is a win-win for both doctors and patients.

But if you want an even quicker injection of cash. Keep reading for the fourth tactic that can help sustain your cash flow.

4) You shouldn’t use the fastest cash available: a line of credit.

So far we’ve discussed three cash-creation decisions that you can take to inject some cash into your private practice or healthcare facility:

Apply for government-sponsored programs Collect on accounts receivables Join the telemedicine revolution

These are three cash-creation decisions that I’d recommend you to take today.

There is a fourth cash-creation tactic that you may want to consider: a line of credit.

I should note that this cash-creation tactic is mainly for medical practices who have existing lines of credit that they haven’t pulled from.

This may also be relevant to medical practices who have not been as affected by COVID-19, and thus a lender would comfortably offer you a line of credit at this tumultuous time in history.

This tactic is the fastest among the four, which is a major pro right now for many physicians looking for some cash.

However, one should pay close attention to the cons associated with a line of credit.

If you’re interested in learning more about the pros and cons of this cash-creation tactic from a qualified banker, please DM me and I will introduce you to a friend of mine who is a banker in downtown Tampa. It’s one favor that I know I can help you with.

No, this “banker-friend” isn’t some sketchy “financier”. They are a VP for a major national bank.

There’s nothing special about this banker other than I can broker an introduction. Because special introductions can go a long way.

Here are all the sources I used to write this.

I had a lot of fun writing this and I learned a lot too.

It’s interesting, I actually prefer thinking about healthcare as a business. Because I view money as an indication of the value I can produce for a client.

So if I was a doctor and a patient couldn’t afford a service because of the expense, I would just deliver more value to that patient to help them meet me at the desired price for my services.

For example, offer flexible payment plans. Or work with charitable partners that pay healthcare fees for patients in a particular socioeconomic categories. I know many Direct Primary Care (DPC) physicians have this kind of flexibility.

But I’m not a doctor.

But what about you reading this? How do you view healthcare? As a valuable for-profit service? Or something similar? Or something completely opposite? I’d especially like to know your thoughts if you’re a physician or if you work in healthcare.

Don’t be a boring passive reader. Medium gives me data on who reads my stuff 😊 So let me know your thoughts in the comments.