Allied health organisations provide an essential service to patients, however in order to continue to operate and provide exceptional care, allied health practices need to ensure they are financially viable.
While positive patient outcomes, patient satisfaction and retention all play a part in the success of allied health practices, implementing financial strategies ensures the practice can continue to thrive and service its patients.
These are many things that need to be considered when setting up and operating an allied health organisation.
Choosing the Right Business Structure
Like any business, an allied health practice can be set up us a sole proprietorship, partnership, trust or company. Each of these structures have advantages and disadvantages especially when it comes to liability, tax benefits and the potential to bring on business partners in the future so it’s important to find the right fit for you and your practice.
Set Clear Financial Goals
It’s important that you set your short-term and long-term financial objectives such as increasing revenue, reducing costs, offering additional services etc. Once these goals are set, you will be able to set-up and operate your practice to align with these goals.
Budgeting and Expense Management
As with any business, a detailed budget will help keep track of income and expenditure. While there will be fixed costs, there will also be variable costs as well and you will need to ensure funds are allocated effectively. By reviewing your budget regularly, you will be able to evaluate where you can reduce costs for the benefit of the practice.
Optimise Revenue Streams
As a business, your practice will constantly evolve, and new opportunities may arise that will enable you to increase your revenue. There may be opportunities to increase service offerings to patients, implement telehealth consultations etc.
Effective Billing and Payments Systems
Delays in payment can affect cash flow. Having effective systems in place will help minimise late payments and outstanding fees. If payment is not required on the day of treatment, utilising automated billing software can assist with invoicing and sending reminders for overdue payments.
Strategic Pricing and Fee Structures
Setting the right pricing model is essential to running an allied health practice successfully. It’s important to remain competitive yet profitable. Consider appropriate fee structures and payment methods that are not only fair to patients but also serve the best interests of the practice.
Compliance and Insurance
As an allied health organisation, insurance is essential. Ensure you have appropriate coverage for your practice and that you are compliant when it comes to practice operations. This will ensure you are covered should a need arise to make an insurance claim.
Managing finances in an allied health organisation takes time, effort and consideration. Having effective strategies in place will help set your practice up for success.