Article by Helmut G. Flasch, CEO Flasch Business Expansion

Times change and with it the way we do things. It is not that all changes are for the worse or are all changes for the better.

One thing however is for sure, when there are changes, in an area then there are several other areas affected and thus those areas also need change. This at first looks like a chain reaction and it looks like that one has to adapt and that one is constantly the "victim" of those changes.

Well, there might be some truth to this but only if you choose so.

Let me explain.

If the way people communicate changes, because someone invented the telephone, then one better starts using the telephone because soon the whole world will be using the telephone. At the end nobody can reach you and your practice because you simply do not have a phone.

So, if you, the practice owner, looks at it as a hassle and if you are dragging your feet in getting a phone then no wonder that you get the feeling of "HAVING to do this new thing and HAVING to spend money on this new thing and HAVING to learn how to use this new thing."

It is YOU who has chosen to look at it from the perspective of defense instead of from the perspective of opportunity (offense) and attack.

Armies, sports people, business people, politicians, do not win by defending - they win by attacking. Never mind that attacking gives you the feeling of some type of control and most likely it is that personal feeling which gives you energy and inspirations to become a leader. Again, as a practice owner you ARE a leader, as a doctor you ARE a leader, as a family man or woman you ARE a leader. Leaders are leaders - not followers - by definition!!

Let me summarize this if I can:

Someone on this planet and in your industry or your environment will come up with something new, bad or good. New ways of doing things, new things etc., which never existed, will emerge because people love to create.

And that, I think, is a good thing.

Anyhow let's look at some changes, which have happened in the medical field, the economy and the communication field over the last decade.

So much has happened that I could not possibly talk about it all.

Here are some occurrences, which you might recognize:

	HMO -- They simply have done the marketing work for you and charge you an arm and leg in the form of discounting your prices.
	HIPPA -- All Insurance companies trying to cut rates on the procedures they cover.
	All Insurance companies trying to tell YOU the doctor what procedure to do for OSHA requirements and it is costing you more to deliver service.
	Insurance companies demanding more paper work and thus increasing your cost.
	Patients becoming less loyal due to participation of insurances and those insurance companies telling the patients where to go.
	Patients becoming less loyal due to the huge marketing efforts of most doctors and those patients really not being able to differentiate the quality of medical service and thus starting to do price shopping and starting to use other inexplicable ways to evaluate where to go - they just do not seem to mind to change doctors anymore.
	Patients are getting used to paying less, because they see it from their insurance, from doctors who discount their prices badly and who don't ask for the co-payments etc.
	More lawyers suing more doctors and insurance companies literally taking advantage of this phenomenon and rising malpractice insurances above and beyond what is necessary.
	Patients do not any more look up to a doctor in awe like they did a century ago - they, in fact are starting to distrust a doctor the same way they distrust a car mechanic or a telephone salesman due to the bad publicity that the medical field is getting. Most of that bad publicity - like most of all bad publicities - is of course "made-up exaggerated bull", only there to sell more newspapers and magazines, but the patient inevitably becomes influenced.
	There are new ways of communicating - meaning we have the Internet which has changed THE WAY WE ALL DO BUSINESS in more ways than is currently visible. We only are seeing the tip of the iceberg of the effects of the Internet at this moment.
	There are many other changes already going on and a load of others in the making. Such as the fact that patients like to go to a "one-stop shop" just like with the grocery store or a huge trend towards alternative medicine.
	You see the patient in many cases rather get everything in one practice even though that might in the doctor's eyes (and only in the doctor's eyes) be less quality-oriented.
	One usually gets better fruits or better meat and definitely better service at the small fruit store and yet most of those small stores are simply gone due to the fact that most people seem to go to the grocery chains, despite some of their shortcomings.

It's no different than we see small and large restaurant chains, bank chains, insurance chains, or car dealers who sell all brands of cars.

	Please, Doctor, look at the fact of how many medical practices of all kinds get already bought by public companies or by other aggressive doctors turned "business people". A trend which will continue at an accelerated rate in the next decade until there will be only "multi-specialty clinics" or small and large chains of dental, chiropractic, podiatric, family practices etc.
	And here is another change which will soon (over the next few years) demand new marketing and new selling as well as new general business strategies: The raising of the insurance deductible to about $2,000 to $4,000 per year. This will also bring the change of more emphasis on preventive care than only on fixing illnesses.

OK, so how can we, or how can you the doctor, use those changes as an advantage?

Based on what I said before in this issue, you must first see how a particular change in the environment could be used to get an advantage.

Just like a judo fighter who uses the force of the opponent against the opponent.

Do not think those new ideas or changes are aimed against you - they are not. They simply are and simply are meant to be some kind of improvement but whoever does not learn how to make those changes useful for themselves will of course be the victim of those changes. The law of gravity and aerodynamics - and if you learn all about it, - you might build airplanes or sell them and become famous and rich. But if you don't learn all about these laws and even ignore or hate them you will probably not only be afraid of using airplanes but also will compulsively avoid them and surely not build them or any other nice gadget. Profiting from it?? Yeah right!! Not in a million years!

In fact you probably will have some weird accident of falling into some hole while other people who at least learned the basic of the Laws of Gravity will wonder how anyone could have such a silly accident.

These days if you do not use all your imaginative thinking on how to use the new changes such as Internet, the fact that health insurance deductibles will go up to about $3,000 per year per person and thus will make the acquiring of patient will take on a completely new light. It will be like if you work with Medicare patients all your life and all of a sudden you are forced to deal with cash patients only.

Big difference! And this has given quite some doctors financial headaches above and beyond what they felt was tolerable.

To most doctors and to most people - period - just the thought of having to make major adjustments such as learning the Internet or new marketing methods or new managing methods and what it can do fully is depressing and hassle to some at least. Doctors feel that they have done their share of learning and hard work and that they are now somehow entitled to a smooth life. The thought, for instance of, having to get their practice to a level of hiring two to five other doctors and also the additional support staff is for most doctors, who have had enough problems to attract enough patients for themselves downright disastrous and un-doable.

There are suggestions that the future small individual practice will be at least three to five doctors simply because of the fact that reimbursement for services rendered will never again reach the levels which they have been one or two decades ago!!

Lower prices means less profit - a lot less in many cases because the overhead is not decreasing but increasing (nothing that any government or medical consultant can do about it).

Lower profit means a less good lifestyle and in many cases even a very much prolonged work life. Retiring at an early age or even at 65 becomes difficult simply due to the absence of money. Every person has the limits on how much work he can do. One doctor might be able to produce X amount with his two hands and another doctor might be able to produce XX. But whatever it is what one can produce there is a personal limit and with prices getting lower and lower and operating cost getting higher and higher, profits for an individual practice are sometimes (very often) pegged at a fixed level (at a very low fixed level at that).

The situation is that one cannot make any significant amount of money being a solo practitioner simply because the fees received for services are so low that even if the practitioner works 12 hours a day he simply will not reach the level of income he envisioned when entering the medical field.

There however, is a solution. Better said, there are actually many solutions just as there are many ways to go to Rome.

One fairly obvious solution is that one has to render three times as much service to come even for the reduced fees one is now receiving.

Since one doctor usually cannot render three times as much service as we stated in the above example one must hire more doctors to perform the additional service. It appears one would have to hire three doctors to increase production by three times but in reality the doctors you hire usually are younger and somewhat less experienced than you the "old dog" and thus those new doctors might be a bit slower which in turn means you might have to hire four new doctors in order to make three times as much money.

Now we will have to look at the situation that you will need to fill those four doctors with patients. (Any practitioner thinking that the new doctors will create their own new patients is waiting to win the lottery - it won't happen!)

Creating those high quantities of new patients cost money. No matter how inexpensive you can attract those new patients it costs money. Money, which again will come out of your bottom line! Never mind that those doctors will need to be paid.

Back to square one - almost!!

Not acceptable!!! Not acceptable at all, since after all you started this (wild) exercise of hiring more doctors because you want to make more money! Right?

So what do you do?

Add one or two other doctors and make sure you calculate the needed marketing efforts into it so that they will have enough patients for them. You the practice owner is the daddy, you have to make sure everyone is fine and is eating - no other choice!

I completely understand that what I just explained sounds like an awful lot of hassle and looks like shooting a fly with a bazooka but maybe you can now appreciate why most industries like the groceries stores or the banks, or the hotels and restaurants and yes, the medical practices are going in the direction of big, bigger and biggest.

The truth of the matter is that the economics do not work out being small. Whether that is good or whether that is bad is complete beside the point. It just is!

In most cases, per proven statistic, and per proven acceptance of the public this "being big thing" seems to have at least a few more advantages than disadvantages.

No matter whether you hate going big, like it, despise it or fear it - the fact is that it is becoming increasingly more difficult for a single practitioner to make enough money and have enough free time to enjoy life.

Now the choice is yours.

'There must be other ways!' you say.

Probably and surely there are, but are they doable in an easier way?

Can you raise prices and become a cash practice with full prices? If you can, go and do it! But keep in mind that can still hand-cuff you to your practice because every time you don't work due to sickness or vacation or getting tired in old age you make less money. You can also insist that this is not the way it should have to be-and you are right again but does your banker care when you've overdrawn your checking account? Does it help to put your kids into a good university? ("Who needs them in a good university anyhow - after all I am a well educated doctor and struggle to make ends meet, so being educated is way overrated anyhow - lets send little John to the community college - it is all the same after all.")

This above example might point out a very very large advantage of getting big.

Realize that once you are so 'big', YOUR OWN PERSONAL PRODUCTION AS A DOCTOR IS NOT ANYMORE NEEDED FOR YOU TO ENJOY FINANCIAL FREEDOM AND FREEDOM OF TIME FOR YOURSELF!

Realize that the plain truth and nothing but the truth is, that we all must learn more than the skills of our profession. We all must have enough knowledge in all areas of life and business to be able to know how to make life and situations and new ways of doing things be our servant - to our advantage and NOT OUR DISADVANTAGE!!

The above descriptive way for a doctor are surely NOT the only way and it will be up to you, the doctor, to invest time and money and above all, to get enthusiastic about looking for ways to juggle this thing called 'change' and use it to your advantage!!

Just don't hit your head against the wall trying get to the other side when all you have to do is walk around. Be a bit open-minded with some sincerity behind it - don't discard all possibilities before you really really gave it all you could.

True happiness comes from overcoming big obstacles - obstacles that are in the way of reaching one's true goals. So, be excited if the obstacles to have a large highly profitable practice in which you have all the free time you want while delivering good service to the patients look impossible.

It only means that great happiness is in front of you if you manage to overcome those obstacles.

Remember the last time you did the impossible? I know you liked it - don't be overly modest!

You can do it, whichever way you choose, to be financially independent with time to play. You can do it if you put your heart into it. You simply must want it!

Helmut G. Flasch
CEO Flasch Business Expansion