What are some of the factors that cause “financial stress” in a practice? The “stressors”?
Here are a few stressors. You could add many of your own, I am sure.
- Low production
- Not enough cash flow to pay the monthly bills
- Unexpected taxes and not enough money to pay those taxes
- Low collections
- Reduced fees due to managed care contracts where you have signed agreements to accept fees lower than your usual and customary fees. However, the fees that you have agreed to accept do not cover your cost of operation.
- Great team members want and deserve raises but the cash flow of the practice can’t support the raise—or that kind of an increase in overhead costs. Stress results for all parties. The team wants, needs, and feels deserving of a raise. The doctors wants to give the raise, understands the financial stresses of his/her team members, doesn’t want to lose team members but wants to keep quality team members and have them be energized, dedicated, and productive.
But all of that takes money—and a healthy cash flow. And so, once again, while you didn’t go into dentistry for the purpose of making money. No. All of you wanted to provide service to people in the form of healthcare. Good for you. Good for society.
However, without a healthy cashflow and without a profitable business, the practice doesn’t keep its doors open. And when that happens, no one wins—certainly not those you have chosen to serve.
And so, as we continue to study this concept of financial health, let’s look at a foundational premise: that you are worthy of being paid (and being paid well) for the services you provide. Let’s take a look inside the thought processes that accompany “money”.