CUTTING COSTS

• Decrease Staffing/benefits!

  • In a tight job market, alternative staffing such as outsourcing and job sharing is often beneficial. Transcription, payroll processing, benefits administration, bookkeeping, and janitorial services all lend themselves well to outsourcing. Job sharing offers flexible work schedules and often eliminates the cost of fringe benefits. Practices should avoid having too many part-timers, however, as inefficiencies and redundant training costs occur. Finally, cross-training for every position should be required to offer flexibility when the staff is on leave and to reduce training costs when turnover occurs.

• Hoard Nickels and Dimes

  • After you are certain that you have dealt with the big ticket areas, start looking for the small savings. Perform a cost/benefit analysis on ancillary services and evaluate the lease versus buy options for every capital purchase. Examine the cost of medical supplies, office supplies, advertising, repairs, and maintenance contracts. Ask your office manager questions such as, "Do you really need a large ad in the Yellow Pages? How many patients were referred to you by the ad?" You should be encouraged to bid out maintenance and other vendor contracts on an annual basis. Closely monitor invoices from other professional advisors and take advantage of prompt payment discounts. Look to opportunities for group purchasing. Centralizing the practice’s purchasing policies can minimize duplications and waste. Practices should consider using a non-traditional telephone company for local and long distance service and always encourage and reward staff for ideas that lead to cost savings.

• The Salary Creep!

  • Avoid the "salary creep" that results from giving automatic raises year after year. The best receptionist is still only worth so much in that position. Each position should have a high, low and median salary range that is competitive with the industry and location. If a standout employee reaches the high point of the salary range, recommend an incentive-based increase instead of a salary increase. Alternatively, the practice could promote the employee to a position with more responsibility and a higher salary range