Evaluating Ancillary Streams Of Revenue

Previously, I have covered the issues surrounding the challenging business environment facing primary care physicians:  Ever-decreasing insurance company reimbursements and increasing overhead of running a business.  Many of you have thought about bringing in some sort of ancillary services to increase your revenue.  You have been approached by medical device companies, pitching such machines as laser hair removal, bone density monitors and other costly devices.  You have also probably been visited by supplement companies trying to get you to sell vitamins and supplements to your patients.  Injectable companies?  Yep, most likely you have been descended on by them as well.

Amongst this myriad of opportunities to bring an ancillary service(s) into your practice, how do you decide which makes the most sense.  First, you must be comfortable with the service you are bringing in.  This means that your skill sets put this service smack in the middle of your radar screen.  If you have a cognitive type of practice, do you really feel comfortable injecting botox and fillers after taking a weekend course?  Do you feel that you can match an aesthetic physician or plastic surgeon in expertise?

When it comes to vitamins and supplements, do you feel comfortable becoming a salesperson to your patients?  Do you feel there is some sort of conflict of interest in doing these type of sales?  Other procedure oriented services such as lipodissolve, laser hair removal etc may also invoke a sensation of inadequacy if you have not done lots of procedure oriented medicine.

The other major issue of course is your investment.  If you are contemplating bringing in some sort of machine such as a laser, bone density machine or other equipment, what is the cost of this?  Do not be fooled by what the monthly “lease” payment is because you will obligate yourself to many years of payments which you cannot extricate yourself from if you do not get the interest from your patients.  Remember that equipment salespeople are commission based and have every reason in the world to sell, sell and sell.  You will be shown beautiful graphs about how much money you can make by putting “X” amount of patients through that service.  But how do you know your patients will want this service?  Insist on the company giving you some sort of trial period at which time, if you decide this will not work for you, there will be no obligation to keep paying.

Obviously, I am biased when it comes to the ancillary service of weight loss because I have seen in my practice how you can build a million dollar a year business and at the same time help your patients become healthier and happier.   As administering a weight loss program is cognitive in nature as opposed to procedural oriented, this is right in the middle of the radar screen for primary care physicians.  You all have the infrastructure to run a highly successful weight loss program:  You have the patient base, the staff, the rooms, etc.   Implementing a weight loss program requires no expensive machines, no selling of products to your patients (if you choose the right program!) and does not require you to perform procedures which are not in your comfort zone.  Moreover, your ancillary staff can perform most of the work.

In summary, ancillary services are almost necessary these days to generate money over and above your practice revenue because managed care has ravaged the incomes of primary care physicians.  Be smart about which service(s) to bring in and make sure your return on investment is quick and substantial.