Hello, and welcome to the Concierge Medical Marketing Podcast. I’m your host, Steve Schwartz.

Our podcast is all about helping concierge medical doctors and their practices thrive and succeed, make more money, have a bigger impact, and have better medical outcomes for their patients. Our goal is to help improve healthcare in America for everyone.

It’s our pleasure to host this podcast to share free information for anybody who is interested in learning about these topics of digital marketing regarding concierge medical practices. We have many guests on our show that are experts in different areas that are important for a business to run successfully.

For example, today, our guest is Dawn Slokan. Dawn, so glad to have you here today. Thank you. Wonderful.

Dawn is an expert in financial matters regarding businesses. Without further ado, I’d like her to introduce herself, and then I’ll share the topic, and we’ll get into this.

Dawn, can you please share a little bit of your professional background with our listeners, please? Sure will. Thank you.

So as you said, my name is Dawn Slokan, and I’m the principal owner of Virtually Dawn Bookkeeping and Advisory. My firm is about eleven years old, and we specialize in two micro niches. Most important to you is that in medical concierge practices and general medical practices.

I got into that niche after having put my husband through medical school and starting in the medical industry, working with a lot of his colleagues and students that he was in school with and really found that there is a gap in the knowledge between being a doctor and running a business, which is not a surprise because we are all trying to get through our own strengths and weaknesses.

Virtually Dawn started, as I mentioned, about eleven years ago after I left my full-time CFO position, and I thought, how can I best take my education? I have an undergraduate in finance. I have a master’s in management and human resources. And how can I take those and really make an impact? And so I started working with small businesses in my community and then expanded nationally.

We do everything from start-ups to established businesses. We do all back-end finance, including payroll, helping with loans, helping organize your corporate structure, knowing what your guaranteed salary could be, and every aspect of the financial end of your business.

Great, Dawn, thank you for sharing that information. You’re very accomplished, and I think your information that you’re gonna share today is gonna be very helpful, specifically for physicians who are considering starting a concierge medical practice. There are many different things that a physician needs to discuss, needs to ponder, needs to research, and so many decisions need to be made.

With your background in start-up and in finance, what we thought would be a great topic for discussion today is what are the top couple of things that a physician would need to consider in the process of starting their own concierge medical practice?

That’s what we’re gonna discuss today. And, Dawn, why don’t you take it away with your first suggestion with, really when it comes down to starting a new medical practice.

Right. Well, I think the first question you need to ask yourself beyond why are you doing this. You’re doing this because you wanna help people. You’re frustrated with the system that’s in place. And those are all great reasons, and those are personal reasons. But, financially, what you need to ask yourself is, how much money do you wanna make? This is your business. You’re running it. You’re leading it, and what is your financial goal?

So starting with where do you wanna end up in the profit category? How much do you want to bring home to your family, for yourself, for your expenditures? You start there and you work backwards. In order to do that, you need to have a good financial model and pricing structure in place.

Medical concierge practices have unique revenue models that combine membership fees, insurance billing, and a la carte services. So you ask yourself, how much money do I wanna make at the end of the day, and how do I get there?

Excellent. So what are the questions and considerations that lead to the decisions that need to be made in order to reach their revenue goal for Safe Hope at the end of the year?

Right. So primary practices consist of subscription billing, and you need to compare the cost of subscription billing out in the market to the subscription billing that you want to charge and the number of patients you want to see. If you start there, you’re going to get your one line of your revenue.

The next thing is taking an estimate of how many patients. So if you say I want two hundred fifty, two hundred and seventy-five patients to make x number of dollars, my subscription times my number of patients, and I add to that my insurance component. So if you’re a family practice concierge physician and insurance pays you a hundred dollars or a hundred and twenty-five dollars per visit, how many times are you gonna see your number of patients times how much insurance is going to pay you, and you get your insurance estimate.

And then finally, if you offer any a la carte services. If you are doing in-office procedures, if you’re doing co-pays on each of your visits, if you are doing supplement sales, and you create a revenue line for that, then you’ll get your total revenue amongst those three lines.

Next, you’d wanna consider your expenses. Your expenses need to come off of that. Expenses like staff salaries and benefits, your rent and utilities, your medical supplies, insurance, technology. Even though you’re in a concierge practice, now you need your own EMR system, your own medical record system. You need to carry your own malpractice insurance. And in order to get those customers, you need good marketing.

Once you know where your revenue projections are gonna be and your expense projections are gonna be, you take your revenue minus your expenses, and you come up with that magical profit number. That’s fine.

Just a thought. Many of the concierge physicians that we’ve spoken with don’t wanna mess around with insurance at all. And so the idea is the patient would pay a certain amount of money per month or perhaps as a one-time annual fee at the beginning of the engagement. And from there, many times, the patient doesn’t have to pay anything else for their care. And like a gym membership, they can come as often as they wish. Have you seen many practices that follow that model?

We have. And there are some fine differences between direct primary care offices and concierge medical practices. So, there’s time to do some research between those two. So, often, direct practices do not involve insurance, and concierge practices often still do collect insurance. It’s just not quite as messy as when you’re working in a hospital system or a traditional medical office because you’re only billing insurance for certain things.

It really depends, and there are plenty of concierge offices that don’t involve insurance at all, but it really depends on what the market around you tolerates. If you’re in an area where you have very high net worth potential clients or you have an area with a lot of small businesses that maybe are not offering robust insurance plans, then I say increase your membership fees, and you can take away the insurance revenue items.

But if you’re in an area where insurance is still important, but there’s not enough doctors to go around them. So you’re offering concierge services so that patients can feel secure that they’re going to get in and be seen and be heard, then you might need to work on your mix of revenue between your subscription services and your insurance.

So many things to consider. So many things. Yes. I would just encourage our listeners to consider how simplified or complex or what the mix would be when it comes to insurance in their practice.

Again, several I’ve talked to say, we don’t take any insurance at all. We don’t wanna fool with it. If someone has a major health issue and they need to go to the hospital for a surgery or something really significant, obviously, they still need to carry insurance for that kind of major medical situation. But when it comes down to having a membership in a concierge practice, the physicians and their offices, in many cases, don’t wanna deal with it.

It’s like, we’re not fooling with insurance. We’re not billing you when you come where there’s no co-pays. There’s none of that. You’re not feeling well? Give us a call or come on in. I would just encourage our listeners to consider what level of insurance involvement do they truly wish to have, and that will play a huge part in how they structure their business. And the structure of the business obviously leads to how do we hit our financial goals. Would you agree?

I would agree. And the beauty and the burden of owning your own business, that is a decision that you can make, that you can work with, professional and, go to conferences. Talk to your peers. Go out and talk to other concierge practices. There are enough patients out there to go around that we can share our information. We don’t have to hoard that all to ourselves. We can share that information so that we can do the best for more patients.

Just really I encourage you to decide what your goals are and then work backwards from there. You know, it’s interesting that you say that. I appreciate the concept where concierge physician, in many cases, don’t look at other concierge physicians as competition, but instead, almost like a brotherhood, a team, a group of healthcare professionals who truly wanna make American healthcare better and better for everybody or as many people as possible.

And so, in many cases, physicians I’ve talked to are so open to sharing their experience, their tips, their strategies, their concepts with other physicians to help them be successful in their concierge practice. Have you seen that as well?

I have. There’s a lot of physicians get into concierge medicine because they’re very frustrated and overwhelmed by the system in place for them. And so when they’re leaving that system, they’re finding themselves with more time for patient care, but more time to care for themselves, and they wanna share. When you’re happy in your practice and when you’re happy in your business, you wanna share that with other people.

Agreed. Well, let’s just start discussing a little bit. We’ve talked about goals, financial goals, and considerations regarding setting those goals. Obviously, technology is a huge part of every business, and concierge medical practices absolutely need the correct technology to keep track of their patients, their patients’ records, their patients’ finances when it comes to payments and whatnot for their membership fees.

Let’s talk a little bit about the financial software and the technology that you recommend that a new concierge practice might want to consider in order to streamline the business part of their business.

Right. So, as you’re saying, I recommend that after you’ve created your financial goals for yourself, the next thing that you do is to set up smart and strong financial systems. Virtually Dawn works exclusively with QuickBooks Online as our accounting system. You use this to track those expenses, your revenue, your tax payments, and you wanna do this from day one so that you have information at your fingertips to benchmark how are you doing. How are you doing compared to others in the industry? How are you doing compared to where you were when you were an employed citizen?

We need to track, as I mentioned, if we’re looking at different revenue streams, you want a separate ledger for each of those different revenue streams. So if you say, you know, I’m starting out without taking insurance, and I’m really not hitting those goals. And I now decide to take insurance. Is insurance really contributing? If you mingle all of your revenue streams or your expenses together, it really is hard to get an overall picture of your financial health.

If you have a proper accounting system in place, it’s going to help you with your cash flow management. So you have expenses. There is a good reason to manage when you are paying your bills, when you’re receiving your tax. We know that if you’re on a subscription model, a lot of people might pay upfront, but you also have people paying throughout the year. And when that happens, there are also people who might send their subscription in the middle of the year. So we need to look at the cash flow of where your expenses are going out, but also where your income is coming in.

And we need to manage exceptions to that for subscriptions that end in the middle of the year. Those that are prepaid, how do you manage stringing that along month to month? And there’s, of course, compliance issues related to how you report that month to month. So good strong financial system like QuickBooks Online is the best place to start.

Excellent. Do you have a particular recommendation for physicians who wish to bill their patients monthly by credit card? There are so many different ways to bill credit cards these days from PayPal to Stripe and many other systems. Do you have a recommendation in that area?

I do. I hesitate to mention one main solution here because there are different solutions even within different types of concierge practices. So a cardiology practice might have a slightly different financial model than a family med practice, for example. But there are subscription-based softwares that will manage the credit card for you, including when a credit card’s expiring. It will know. It will go out there and your, subscription base to renew their credit card so that you’re not behind the system waiting for it to expire or getting a bounce fee or something like that.

It’ll help manage ACH fees. Anytime I can encourage physicians to use ACH over credit card, I do. The fees are just a lot lower. Oftentimes, one percent versus three percent. And they maxed out before a credit card fee maxes out. There are ways for us to charge credit card fees back to the client, back to the patient. So it just depends on what the goals are of the physician on how we would structure that particular end of the software.

Sure. I know that QuickBooks Online has the ACH built into it. And so, depending if they’re, let’s say, paying for their fee for the entire year, for a maximum, I believe, fifteen dollars for literally, it doesn’t matter how many thousands of dollars are being paid. The max is fifteen dollars. Have you seen that?

I have seen that. QuickBooks is making some changes to those fees right now, and that’s why it’s important to investigate all the different technologies available. So we often use a second third-party software for the subscription service and link it to QuickBooks for financial reporting.

Very cool. Love it.

Let’s talk a little bit further now about pulling all this together. We have our goals, how much money we wanna make. We have our plans on how we’re going to get that income coming in and obviously paying our expenses. We’ve talked a little bit about the software and the systems to track the funds and make sure we’re on track.

What is the final component that you would recommend that a new practice implement in order to help them pull all this together?

So no matter what business you’re in, I recommend that you do regular financial reviews. I recommend you do that with an experienced professional, but at the most basic, I recommend that you review your balance sheet, your income statement, and your cash flow statement on a monthly basis.

Your balance sheet is a picture in time of your financial position. It will show you the balance in your bank account, the balance on your credit card statement, the amount that you owe to other people and the amount that other people owe you, and the sum of those components show you the amount of equity you as an owner have in your company.

And from that one report, we can look at what is actually going on inside of your business. Do you have enough money to meet your debt? Are you repaying your loans? Are you paying yourself?

The second is your profit and loss statement, your income statement. This is a detailed breakdown of what your revenue and your expenses are. How much are you spending on advertising? How much are you spending on accounting services, on marketing, on telecommunications, on your insurances?

The bottom line of your profit and loss statement, which is called your net income, that flows onto your balance sheet in your equity section. So, again, we’re pointing back to that balance sheet for a picture of your financial health.

And then finally, I recommend you look at your cash flow statement, which is gonna tell you this is where my cash started at the beginning of the period that we’re reflecting on, and then it’s gonna tell you where that cash changed throughout the period. Was it from investing activities? Was it from financing activities? Or was it from operating activities? And, again, that position flows onto that balance sheet.

We recommend you really pay attention to those three statements on a monthly basis. There are so many things for a business owner to keep track of, and I wonder if we have some people listening to this podcast who are gonna say, this is overwhelming. I don’t know where to start. I’ve heard of these things, but they didn’t teach us this in medical school. This is overwhelming and a daunting task.

Can you touch on how important you feel it is for a concierge physician to utilize the services of a professional financial adviser, an accountant, a bookkeeper such as yourself? How important is that really?

I think every company of all sizes in all industries should use a professional to do their bookkeeping. Just like most companies realize they should use a professional to do their taxes. And I recommend that you keep your bookkeeping and your tax professional separate. Those two individuals have open dialogue with each other throughout the year.

The reason I say that is because it becomes a check and balance on each position in order to make sure that the overall company is good. A bookkeeper is looking at your day-to-day financial transactions. And a good bookkeeper and a good advisory firm such as Virtually Dawn, we’re looking at those in a way that we can help you respond immediately to the needs of your business.

So if we see your expenses are creeping up and that revenue stream isn’t coming in and you’re going to have problems meeting payroll this month, we see that day-to-day, week-to-week, and we can help you through those items as they’re coming up.

A good tax professional should be meeting with you quarterly, biannually, and they should be saying, strategically, these are the things you need to do so that your tax position is the best for your business. It’s not a day-to-day responsive level. And then at year-end or even in those quarterly or biannual meetings, your bookkeeping professional and your tax professional could be talking with each other about where the business has been throughout that look-back period to really know where it should go in future quarters.

So many good nuggets here, Dawn. So grateful for you taking the time to speak with me today and share this information with our listener. If someone would like to speak with you specifically about the services that you offer or to give some advice or explain something further that we’ve talked about here today. How can our listeners get in touch with you directly?

Yeah. And I really encourage you to reach out. We do a fifteen-minute discovery call with potential clients, and I believe every one of those calls leads to at least one nugget of information. So if you would like to do that, please go to our website at www.virtuallydawn.net or send us an email at dawn@virtuallydawn.net.

Excellent. Boy, this has been so helpful. I’ve learned some things today and, really looking forward to publishing this podcast for people to learn from.

I have a question for you. Would you be able to put together maybe a single-page document to share with me and that I could put those, basically, notes from what we talked about today onto the website, conciergemd.marketing so that when someone watches this video on our website, they can also download the PDF of your notes. Is that something you could do for us?

That is absolutely something I would love to do. Wonderful. I appreciate you doing that, because when you talk through something like this, so many nuggets go zooming by, and it’s like, oh, what does he say about this or that? It’s nice to have things written down and people can print that out or save it on their computer.

Good. So I thank you again for your time and your expertise today. One thing I did wanna mention is obviously this was focused today on financial matters for starting a new concierge practice. However, for our listeners who are looking to grow their practices and want to use effective digital marketing to help their business grow, I’ve written a book called the definitive guide to winning with Digital Marketing for Concierge Medical Practices.

This book is absolutely free and available for download on our website conciergemd.marketing. I encourage anybody who’s listening who wants to get a copy of that book to please go ahead and go to our website, scroll down the page a bit, and put in your email address. The system will send you the link so you can download that book.

This has been Steve Schwartz and Don Slokan from Concierge Medical Marketing and the podcast. We’re so glad that you’re here with us today, and come back for the next episodes in the future as we continue to talk with people, physicians, and marketing experts and financial experts to help concierge medical practices grow.

 

(View Dawn’s PDF File Here)