Revenue Forecasting: MD Referral Perspective

Author: Christina Acampora, DC/Wednesday, February 03, 2016/Categories: May 2015

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By Christina Acampora, DC 

HOW CAN MARKETING TO MDs HELP YOUR PRACTICE?

In business terms this is known as revenue forecasting. There is no simple answer. Doctors of chiropractic (DCs) must examine the variables and factor them into how to benefit their own practices and help make use of their expertise. First, let’s look at a few main rules:

RULE 1 > Everything looks good on paper.

Any revenue goal should be tied to a strategy. Of course, the assumption is that your practice will experience steady upward growth.

Ramp-up time: It is wrong to assume that if you go out and meet 10 MDs, you will gain at least 10 new patients a month. That’s wishful thinking based on assumptions that you are ready to market (i.e., have all the preparation done), have the time to market and will convert all 10 physicians to referrals upon the first visit. All chiropractic physicians can be successful in promoting their skills, but how fast each one gains that ability is widely variable. Sadly, unrealistic expectations equate to a sense of failure when not achieved.

RULE 2 > Multiple Variables

Accuracy in forecasting is difficult when so many factors come into play. Health care in general has become more complicated to navigate, with obvious repercussions for profits. The chiropractic profession is one of the most regulated, putting obstacles in the way of achieving goals.

Most DCs, and even most healthcare professionals, are not taught adequately to properly forecast revenue, making accurate analysis difficult without a degree in business.

There are variables in practice. Some DCs are very proficient in building up a practice with many purchase options (e.g., braces, nutrition, health classes, etc.) or health plans (e.g., weight loss, functional programs, etc.). Included in this area is proficiency in billing and coding.

Geography plays a role. Some areas are well-populated, more health conscious than others, more forward thinking; and in some communities all citizens know each other. There are some with major hurdles like bias, hospital conglomerates or bad reputations expressed by a few but heard by many and so on.

RULE 3 > Lack of Historical Data

Perhaps what makes it hardest to find a sound entry point into revenue forecasting is the lack of historical data on the financial impact of medical referrals. Any time DCs strive to build MD relationships in their areas, they are introducing a relatively new thought process and treatment option known in the business world as an emerging trend. With little historical data, it’s difficult to pinpoint with any accuracy what the upside might be.

Let’s review some tips to help create a revenue forecast that allows you to be successful.

• Understanding how the sales process works to effectively convert prospects into referrals.

Proper planning and execution, securing the right meetings, delivering a pointed message and proper follow-up all affect how successfully the sales process is understood, carried out and valued by your audience. Perhaps the most important of these is how consistently you can identify individual MD needs and obstacles that would prevent a referral and then use your policies, diagnosis process and research to respond.

The patient’s office visit and whether or not it was a good experience or an outstanding one will reinforce or destroy your progress with an MD. The same can be said for physicians. Do they know how outstanding you are? Don’t leave it to patients to tell them: Express it through continued contact and short discharge reports.

The ultimate gauge is whether or not you see results, but keep in mind that there are doctors who will be quick to refer, known as fast adopters, and those who may take several meetings over several months to refer, known as slow adopters.

• Revenue projections should be supported by market facts, not just an assumption of upward growth.

For instance, who is your addressable market? Many DCs assume the entire medical community is and subsequently waste a lot of time by not prioritizing. There are specialties that are more desirable than others, geographical implications (i.e., in a major city, drawing MDs close to your practice can be a real issue), insurance considerations and even local politics. Additionally, there is a need to identify physicians whose value may not necessarily be in referrals, but in the opportunity their relationships and standing in the medical community offer you for networking and integration.

Identifying problems with traditional back pain treatment as perceived by a specific MD is another fact you must uncover. Just because you believe there to be a problem doesn’t mean the MD does, so this is when your message needs to pack a punch as well. How much a physician perceives a problem to exist translates to how much he or she is motivated to fix it and whether or not you’re the one to do it. Identifying needs helps to create a sense of urgency.

Competition is another issue. You need to know who your competitors are, how solid their services are, how your services compare, how satisfied the MDs are with those services and how you can improve on that expectation. Finally, how will your competitors react when you pick away at the available market share? Likely they won’t sit back and share without some sort of response. Watching office statistics weekly and monthly can help spot those trends early on. Remember that your projections are only as good as the assumptions they are based on.

Discipline and tenacity in applying and evaluating a sales process are keys to success, as is the understanding that as with patient care, you need to reevaluate and understand when to change course. Have a worst-case and a best-case scenario based on as many market facts as you can ascertain. Analyze your market with the tips above, and don’t forget to network with your MD community and talk with your patients, imaging center operators and anyone who can help you understand your competition, obstacles, community needs and barriers.

Dr. Acampora is the author of Marketing Chiropractic to Medical Practices and the founder of Aligned Methods, a company specializing in helping DCs establish informed working relationships with medical physicians.
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