4 Tips to Having a Cash Cow Practice
In my analysis and study of over 3,000 doctors that I’ve worked with from literally all over the world, I have come to the conclusion that most everyone could dramatically change practice income if they would focus on four areas of practice:
What are these four areas? I call these the Cash Cow Factors.
A chiropractor in my Mentor Program, Dr. Todd George, recently wrote me:
I said that every doctor could increase practice income, if they focus on four things called the Cash Cow Factors. They are:
"I talked with Ben the other day and he really emphasized prepay, something I had not done before. At our last staff meeting the major consensus was that in the farm community I work in, people would not want to prepay.
I am also 100% cash and mostly acute care. Yesterday I started using the prepay forms from Ben's 100% Turnkey Practice course, to at least give people the option of prepay.
I saw 4 new patients yesterday and 3 of them opted for the prepay. They scheduled for 20 visits at $840 each. Not bad!
(Authors Note - Since getting this letter, Todd has told me that now every single patient has prepaid accept for one, since he started asking for prepayment. His success percentage of well over 90% is normal for our students who give this a try. Usually the greatest objection against pre-pay that you'll get, is your own. - Ben)
I have also started giving seminars on various topics in my office. I placed a $90 ad in the local paper and have fully booked three dates!
I allow 12 people per seminar. This is mostly because that's all I can fit in my waiting room. My first talk was to 8 people and 4 of them became new patients.
I have cut my hours all the way down to 3 days per week. And use 1 to 2 days as my rainmaker days. (Authors Note - Rain maker days are your business building and systematizing days, as discussed in the Monster Patient Flow! Vol I course. - Ben)
A substantial part of my practice is acupuncture along with chiropractic. I have been doing seminars on thyroid problems, and it has been getting a great response.
I use a technique called body restoration technique (www.bodyrt.com) and I do not charge for the seminar. But I give every attendee the opportunity to schedule for a preliminary exam at a reduced fee.
I get a little nervous when it comes to change, but after the past week with the small changes that we have made thanks to your advice, I am more willing to try just about anything as long as it works. Sorry this was so long-I am still excited about the great week!"
- Dr. Todd George, D.C.
Cash Cow Factor #1: The Pre-Payment Approach. Have a goal to get one pre-pay case a day, every day your practice is open for business. If you are open 20 days a month, try to get 20 case plans prepaid.
Cash Cow Factor #2: The Fee Increase Strategy. Todd is under charging for his services at under $800. He should increase his case plans to at least $1,000 and I’d prefer over $1,500. But let’s be very conservative – he could increase his fee’s on new patients to $999 tomorrow, with little negative impact. Trust me, doctors we work with always fight me on this. Eventually, I just force them to raise their fees. Patients never revolt, in fact the more you charge the greater people value your service. (Note – I’ll admit there is always a ceiling to what it is advisable to charge. But 99% of doctors aren’t even close to it.) What impact does raising of fee’s have on a practice? It has a huge impact! Because for every 1% you raise your price, profitability increase by 10%.
Cash Cow Factor #3: The Maintenance Program: At my last Mentor Workshop in Las Vegas, my coaching program, I taught doctors that the best time to enroll people in ongoing maintenance is within the first 3 appointments!
If you’re a chiropractor, have a “monthly maintenance program”.
If you’re a dentist, have a quarterly “teeth for life program.”
In every medical profession, there is a maintenance aspect that could be turned into a formal program. It is much easier to enroll people into a Program than to chase them.
People love to belong to clubs and memberships. It’s smart business to find a way to turn your maintenance program into a club or membership, and offer a discount on services once they are a member of the service.
There is certain buying momentum that is present after we ask a patient to make the greatest financial commitment to us. That is the best time to plant the seed about your maintenance program.
An example from a chiropractic practice:
A good chiropractic Lifetime Care Program can be quite profitable. By way of example, let’s say your practice gets about 200 new patients a year.
Using a Lifetime Care Program we’re able to enroll 80%. What this means is, after that patient has completed corrective care, they go into your Lifetime Care Program. Our doctors are charging about $100 a month for maintenance. Some more, some less, but $100 a month is average.
Here’s where it gets exciting.
Do you realize that within 3 years, we would have about 480 people in the maintenance program. At $100 a month that is a monthly income of $48,000.
This major income stream came about by adding a beneficial service.
Often just by letting patients know about such a program, that’s all it takes to fill it.
I would like to point out that this income increase came about from this one cash cow factor. This example has not taken into account the other three that we’re discussing.
Let’s deal with reality
It’s not fair to assume people won’t move away, drop out of the program, and so on. So your actual income would be less.
But the point is that you can generate a substantial stream of income with a solid Maintenance Program.
Cash Cow Factor #4: Back End Services and Products: This is the fourth important cash flow factor. I wrote an article on How to make $25k from a Nutritional Program This described a way that some chiropractic doctors are getting 80% of the patients to purchase a nutritional program on the first or second visit. After a few months, it’s not uncommon to be grossing $2,000 to $3,000 a month. Every bit helps, after all that’s $24k to $36k yearly income increase.
Make these a daily focus in practice
By making these four important areas a daily focus in practice, you can make solid improvements to your cash flow and collections.
One doctor that has been a customer of mine for years recently emailed me and said,
“Ben, I have always valued your advice. But it wasn’t until you taught me the four Cash Cow Factors and saw how to use them in my practice, that I’ve been having my best months ever since opening the practice.”
This doctor increased his practice to over $105,000, by focusing on growing the four Cash Cow Factors. From my direct experience, I can assure you that anyone reading this is capable of achieving similar practice income. Now get to it!
Don’t keep us a secret! Tell another practitioner about our practice building community.