Fall 2009 issue of Horizons

INDUSTRY u PROFESSIONAL SERVICEs

questionable. Reductions in elective surgeries, loss of health insurance, and/or higher deductibles by patients are the obvious factors that are leading to less revenue for physicians and other related types of business arrangements that are physician owned. Over the past five to 10 years, physicians could count on a steady stream of income from their physician owned centers that would supplement their practice income. Currently that is not always the case. So what is a physician practice to do? The obvious answer is to reduce costs. Freezing staff salaries, deferring the hiring of another physician or replacing the position with a physician assistant and turning accounts over for collection more quickly are just a few of the measures physician practices have implemented in 2009. But that can only go so far. What should physicians do to give them a competitive advantage in the future? Physicians need to think out of the box and differentiate themselves from others. The following suggestions are food for thought: 1. Begin or expand the practice’s marketing effort. Although the upfront cost may seem significant, the long-term results may be rewarding. Consider sponsoring events in the community, holding free seminars, and sending out health tips to patients via e-mail. Anything that makes patients remember the practice will drive them back when the economy turns around. 2. Consider expanding the practice into rural areas by providing services in a hospital or surgery center or opening up a small satellite office. Statistics show that the rural areas will have extreme physician shortages, particularly surgeons, over the next five to 10 years. By getting into a particular area first, the practice can benefit into the future. 3. Start exploring or expanding options with hospitals, either for the practice or the related surgery center. Hospital/physician joint ventures tend to go in cycles, so being positioned for the next generation of business arrangements will put the practice at a competitive advantage. The

Professional Services Providers — Recession Proof?

By Ken Rubin, CPA

As head of our Professional Services Group, I hear all the time that the professional services providers are less impacted by the economy than other industries. The answer is “not really.” The major two subgroups included within our Professional Services Group are physicians and related services and law firms. Let’s discuss each one separately, the impact of the economy and what can be done to “stay ahead” of the competition.

Physicians and Related Services

Most physicians have seen a decline in revenue, primarily from performing fewer procedures, although the future for rate increases also appears to be

47 u fall 2009 issue