We at Russell Health would like to share an article written on April 20, 2020 by Todd Petersen published by Dermatology Times.
The coronavirus has created a challenging environment for all private healthcare practices. After all, most are suffering through significant patient visit declines, or have shut down altogether. The adage by Sir Winston Churchill, “Never waste a good crisis,” applies to our current situation. But to come out of this crisis stronger, we’ll discuss how to make the most of a bad situation by adding telemedicine, getting prepared to reopen, and performing a strategic review of your practice. Let’s create a checklist you can use to explore all aspects of your private healthcare practices.
Add Telemedicine to Your Practice
Embrace telemedicine. Telemedicine is a tool that makes healthcare more accessible, cost-effective, and helps to increase patient engagement. Many practices have already made a hard pivot toward telemedicine. Indeed, some have converted as much as 30% of their schedule to telemedicine visits. During this period of social distancing, telemedicine allows a physician to provide care for their patients and still keep the “lights on” in their practice. Since adding telemedicine will help you serve patients now, and to keep revenue flowing to the practice, we suggest this being your first priority.
In mid-March, the Department of Health and Human Services Office of Civil Rights and the Centers for Medicare and Medicaid services relaxed privacy and payment regulations to encourage telemedicine visits, now reimbursing them at the same level as office visits. Taking a longer-term view, many believe the COVID-19 pandemic will permanently transform the health care delivery system, and telemedicine will become a permanent mode of treatment. Physicians and patients can share information in real time from one computer screen to another. And they can even see and capture readings from medical devices at a faraway location. Using telemedicine software, patients can see a doctor for diagnosis and treatment without having to wait for an appointment. Patients can consult a physician at the comfort of their home.
Get Prepared to Reopen Your Practice
Focus on your supply chain. It is well known that supply chain management is an integral part of most businesses and is essential to company success and customer satisfaction. To reopen your practice, you’ll need to procure new supplies of personal protective equipment (PPE) to safeguard you, your staff and your patients. As you look to secure needed supplies, you may find your old sources are no longer sufficient, and you need to spend time finding new suppliers. You may also find the costs for PPE have dramatically increased. Larger practices have teams dedicated to supply chain management, and are currently solving this constraint. For smaller practices, we suggest getting to work on this issue early by contacting your current supplier, connecting with competing suppliers, and networking with other physicians on the topic. Checking with other physicians may help you to find new sources for PPE, as some practices have found new sources of PPE in China.
Replenish working capital. Your practice will need an adequate amount of working capital to restart or ramp your practice back up. If your practice is like a lot of others, you lost money during this extended slow-down, and the financial loss has depleted your working capital. Through the CARES Act/PPP, organizations – businesses and not-for-profits – with fewer than 500 employees are eligible for a business loan to cover business expenses, up to the lesser value of 2.5 times your average monthly payroll, rent, utilities, and loan interest or $10MM. The terms of the loan will be attractive at 10 years with an interest rate of 4%. Working capital is the difference between current assets and current liabilities. Current assets include assets like cash, accounts receivable, inventory and supplies. Current liabilities include accounts payable, payroll payable, short-term loans and the portion of long-term bank loan payments that need to be paid over the next year. If you are like many practice owners, you moved quickly to furlough some or all of your team members to conserve your working capital. However, this by itself will not preserve the critical assets.
Develop your organization’s culture. While there is no one right way to build organizational culture, the best organizational cultures are nurtured every day. This shutdown can be an opportunity to step back, and with your team determine what cultural changes you should make. In order to remain connected with team members during this period, consider setting up a private Facebook group, group text message, or similar communication medium. Perhaps you could consider hosting a regular, virtual happy hour with your staff to stay connected and have fun during these stressful times. Facilitating such communication will allow you to develop culture further and engage more. When it’s time to ramp up again, your people will appreciate the connection you kept with them, and be more likely to return and rally around you.
Review your strategic plan. A strategic plan should be developed every three years and revisited and tweaked every quarter. McKinsey Consulting defines strategy as a set of integrated, hard-to-reverse decisions made ahead of time in the face of uncertainty to create and capture economic surplus. Before embarking on a strategic planning process, spend time framing your problem statement.
After you develop your problem statement, start to identify all your strategic choices. To organize your big decisions, start by asking the following questions:
- In which geographies should we compete?
- Which services should we offer?
- Which customers should we serve?
- How should we compete?
- How do we time or roll out our choices?
In Jim Collins’ book, “Good to Great,” he suggests that a great strategic plan answers the following three questions:
- What can you be best in the world at?
- What can you be passionate about?
- What drives your economic engine?
If the answer to these three questions converge, then you have a compelling and winning strategy. He referred to a company’s answer to these three questions as a company’s Hedgehog. At Russell Health, we believe we can be best in the world at aligning with our partner physicians, we are passionate about serving our partner physicians, and the number of partner physicians we serve drives our economic engine. The answer to these three questions all converges and focuses on our partner physicians. To help with cashflow, learn more about becoming a member of our Stem Cell Recruitment Therapy® Program.
Revise Marketing Strategy. A great marketing strategy requires you to define the market segments you are going to serve. Market segmentation requires you to divide the broader patient group into subgroups or archetypes based on shared characteristics. The best market segmentation considers the behaviors and attitudes of patients. Unfortunately, this level of insight requires sophisticated research methodologies that many practices cannot afford to conduct. As such, many practices segment their patient populations into more generic patient segments like age, gender, payor (Medicare, FFS, Medicaid, etc.), geography, etc. No practice can adequately serve every market segment, because each segment has competing needs and desires. Therefore, you must pick and understand the market segments you are going to serve.
Once you choose those market segments, you can develop a comprehensive marketing plan. Now, with your market segments defined and selected, consider revisiting how you are currently marketing your business, and where marketing other aspects of your business—or marketing via different channels—may create more value. If you haven’t embraced social media, now could be a great time to refresh your profiles and plan content for the coming months. With patients most likely quarantined too, you can imagine they are getting lots of screen time, making it the prime time to step up your social game.
One word of caution: in these difficult times, it can be easy for businesses to forget just how their communities are hurting. If you sell too much, you’ll likely alienate your audience—including patients who have previously been supportive of your practice. Instead, focusing on positive things your practice is doing or can do for the community is a more effective tactic. Learn more about our Patient Referral Program and customer marketing offered by our Marketing Partners.
Focus on building community.
Use this time to focus on building community connections around your practice. With record unemployment, people notice businesses that are there for them instead of merely there for their money. Look at ways you and your team can help in your local community, and you may be surprised at the rewards your business receives in the future. Patients come to you for many reasons (such as the services you offer or your price points in comparison to other service providers). However, there are likely to be more patients who want to support businesses that are part of their local community. Not only is being there for your local community the right thing to do, but it’s good business practice, too. There’s no better time to rededicate your practice to being a community partner than in times of crisis like now.
Let’s not waste a good crisis. Let this list be a starting point for you to reflect on what you can do today and tomorrow to ensure that you are in the best shape possible. And don’t be afraid to ask for help – we‘re all in this together!