Editor’s note: Welcome to Practice Points, by physician practice management experts Capko & Morgan. It is their belief – and ours too – that the more education sales reps receive on the issues facing their customers, the better prepared they are to provide solutions. Their emphasis is on helping physicians build patient-centered strategies and valuing staff’s contributions.
By Laurie Morgan, Capko & Morgan
I’m writing this in the middle of Q1, a time when physician reluctance to commit to new spending has become remarkably predictable. Although calendar-year budgets are fresh – theoretically opening the door for more investments – there is usually anxiety about whether revenues will materialize as planned.
That’s because most of our clients are dealing with the “January effect” – i.e., the decrease in volume many specialties experience as the year begins. Patients with significant deductibles (these days, that’s most of us) tend to put off all but the most necessary care as the year starts, because they’ll have to pay most or all of the cost themselves. The pinch really hits in February, since January’s revenues are buoyed by insurance claims from December.
Capitalizing on the January effect
The deductible reset makes Q1 a tough time to get new financial commitments, but it’s a wonderful time to work with doctors, who have more openings in their schedules. We aim to capitalize on this by booking a project in the fall (when the client’s cash flow is best) that will be executed in Q1 (when their schedule is lighter). We also find that Q1 is great for access to doctors to discuss longer-range projects (just not for committing the money … yet).
Administrators, on the other hand, are often quite busy in Q1 with year-end analysis and reporting. So we try to be considerate of that, and do our best to stay out of their hair!
Executing projects in Q1 that we booked in the fall is a productive pattern for us, as is targeting that time for more strategic conversations with our physician clients. Booking a big expense in that time period is tougher, even when budgets have restarted. But it’s a good time to discuss the benefits of an investment, and plan for it to be booked later, when the revenue picture is clearer.
Warming up: renewed productivity, planning for fall
For most practices we work with, the deductible bubble bursts by the start of Q2, and practices hit their productivity stride again. Insurance revenues return. With the financial picture clearer, there’s a window when booking business may be easier.
Spring also finds many practices focused on making hay while the sun shines. Summer is just around the corner. Vacations mean short-handedness, and everyone’s workload is increased. It’s harder to get a quorum, so we plant seeds in summer that we hope will bloom into deeper conversations in the fall. When a decision requires multiple players to agree, we have to be more patient about timing.
Reps may face some of these same challenges, but there are perhaps more opportunities, too. There are many needs to plan for in the spring and summer, and many ways to impress your clients with your attentiveness. Busy juggling staff and physician schedules and focused on optimizing collections, administrators, in particular, may find the summer flies by. Practices may find themselves unprepared for the busiest – and most lucrative – time of year.
Make it easier for practices to order vaccines, supplies, and other essentials – quickly, without hassle – and you’ll be a hero when the busy summer suddenly becomes the even-busier fall and winter. Year-round, by simply understanding the impact of seasonality, you’ll stand out – whether by remembering the necessities your clients might forget, or simply being sensitive to times of extra stress.