The Importance of Multiple Income Streams

Most consultants in private practice have only two or three ways of generating income. Typically this comprises the following:

1. Seeing patients in clinic (pre/post op)
2. Surgical procedures (including endoscopy)
3. Medicolegal reports

And that’s it.

Now the problem with the example above is that limiting your income to such a few sources not only limits your income but also leaves you exposed and vulnerable to changing circumstances. If, for example your referrals dried up (say a GP who used to send you the majority of your patients went off sick) what then? Or perhaps a newly appointed consultant started out in private practice in direct competition with yours? Your income could plummet virtually overnight. So it is important to have multiple income streams both to increase your income but also to act as a form of insurance to the vicissitudes of fate.

So how to go about this, and what possibilities exist?

Step one is to look at what you are already doing, both for your NHS patients and private patients, and look at ways you could improve things. For example, in the NHS there is huge pressure to discharge patients from follow-up in the clinic, and not only are we as doctors uncomfortable with that but also patients don’t like it – they feel rushed out and less cared for. It could even be argued that this is substandard medicine – clinical trials are underway looking at various ways of following up and managing patients following colorectal and breast cancer surgery and comparing that with outcome. Whatever the results of those trials, it is important to remember that if the patient feels rushed they will by definition feel they have had a less satisfactory consultation and so will be less happy with their care. And the less happy a private patient is, the less likely they are to either come back and consult with you again or to refer their friends and family to you. And remember, we do not have have the same constraints in our private practices as we do in the NHS, so as long as we behave ethically and in the patients best interests there is no need to follow the same management pattern.

So the obvious thing to do here is to offer to follow up patients for longer. Note I said ‘offer to follow up‘ – some patients will be perfectly happy to be discharged after minimal follow up but the majority will want to see you again and again – even if they have to pay for it themselves as their insurance payments are likely to be capped. There is nothing wrong with this as long as you are completely transparent in what you offer and the patient is not put under pressure.

Additional sources of income you could consider include:

Cremation fees
Holding sports injury clinics
Medicolegal work
Minor surgery clinics
Hospice/inpatient medical cover
Travel clinics
Joint ventures

The list above is far from exhaustive – over 50 ways additonal income sources leap to mind immediately – but serves as a useful starting point. Which ones (yes, plural!) of these you choose to do really depends upon you and your own background as well as your interests. But of them all the most interesting and valuable in terms of patient satisfaction and your income is joint ventures.

Joint ventures
JV’s, otherwise known as strategic alliances or partnerships are potentially very valuable in growing your practice income. In a nutshell, you have a relationship with another colleague who provides additional services of value to your patients. This might be a physiotherapist, physician, whatever. Now, one thing to say from the off here is that to avoid falling foul of the powers that be you need to make it explicitly clear to your patients when you refer them in this way that you have a financial relationship with that other person and that they are perfectly free to go and see someone else about the problem if they so choose. Ideally do this in writing so there is complete transparency. You may be surprised to learn that the vast majority of people referred in this way do not object in the slightest, and in fact appreciate the fact that they can get all their needs attended to with the minimum of fuss and inconvenience.

The scope for joint ventures is enormous, and really only limited by your imagination – NOT by your speciality.

The key is to
a) Look at things from the clinicans’ point of view. 1. What types of clinical problems do your patients present with? 2. What types of people do you see – thier demographics,interests etc.

b) Now turn things around completely and try and put yourself in your patients shoes ‘If I was a patient under those circumstances, what needs would I have that are not yet being met, or met badly and could be improved upon?’

Obvious examples include the orthopaedic surgeon with an interest in sports injuries teaming up with physiotherapists’, fitness trainers, local health clubs and the like.

Using this model, truly stunning practice growth is possible.

By Dev Lall FRCS