Chiropractic students’ biggest concern is getting through the rigorous education requirements and passing the federal and state board exams.
However, once you are licensed, other fears begin to surface—like business practice.
There is a disconnect between the heavy chiropractic curriculum, chiropractic colleges, and students. It is because business-practice thinking does not begin until late in the academic phase. This puts tremendous pressure on students to find a job or start a practice, mostly because they have sizable student debts to address.
The U.S. Health Resources and Services Administration (HRSA), an organization that collects data on student loans defaults, noted that in October 1999, May 2010, and January 2012, more than 50 percent of the individuals on HRSA’s default list had attended chiropractic colleges.
Inversely proportional to this, the average annual income of practicing chiropractors in the U.S. has been dropping steadily. For example:
- 1989: $101,000 (Source: American Chiropractic Association)
- 1997: $86,500 (Source: American Chiropractic Association)
- 2010: $87,000 (Source: Chiropractic Economics and U.S. Bureau of Labor Statistics)
For this reason, chiropractic students need to become more business-minded early in their chiropractic education. I recommend reading business books, contacting chiropractors in practice, and finding chiropractic mentors after your third trimester. Allotting two hours a week to learning business practices will pay large returns in the future.
Expenses are expensive
Most people go out of business not because they cannot make money, but because they cannot pay their bills— even if they are very busy with work.
For example: A plumber is extremely busy. He has the contracts for over 400 Burger King, McDonald’s, Wendy’s, and Taco Bell restaurants.
He bills about $700,000 per year to these businesses but he struggles every month to pay his bills. It’s because big corporations can use their clout to defer payments up to 120 days, which dries up cash flow in the plumber’s business. If the plumber stands firm and sets boundaries with time limits on his invoices, these large clients will just use someone else.
Chiropractors who do a lot of insurance and personal injury (PI) work run into this situation as well. One chiropractor I know did 95 percent insurance work, and billed the patients’ insurance after each visit. The insurance companies would take five to eight weeks to pay invoices and, because of that, the clinic had no cash flow. The practice was forced to close within five years of opening its doors.
One thing to do every week is measure how many patients come in, and how many are booked for the following three weeks. Business performance measurement has a variety of uses.
First, it sets goals and objectives that give you something to compare week upon week. Second, it helps you forecast slower times of the month and make adjustments to counter them. When I forecast a slower time approaching, weeks beforehand I can put a sign in front of my practice or develop an in- house promotion program.
And measuring objectives keeps you focused on the big picture, fostering steady improvement so that you can continually augment your goals and improve your outcomes.
Many experts also recommend making sure you see and pay for every expense. If you want to reduce your expenses by 10 percent, try signing every check and monitoring every outgoing cash transaction.
Do this every month because this way you can locate unnecessary expenses, and find other solutions that are financially healthier for your practice. For example: One year I saved $3,000 by sourcing a new company to cut the grass and remove snow in the winter. Another time I saved $400 per month by finding another company to support my point-of-sale credit card machine.
Promote your brand
Recently, an article in the Annals of Internal Medicine was a systemic review to determine clinical practice guidelines for the American College of Physicians with respect to noninvasive forms of treatment for acute, subacute, and chronic low-back pain.
The review recommended spinal manipulation (ahead of medication) as a first-line treatment for acute low-back pain. Along with prudent business practices, collectively we must be comfortable educating the general public about research findings such as this study. Doing so will help bolster chiropractic’s credibility and grow our patient base.
Anthony J. Lombardi, DC, is the creator of the eXStore assessment system. He is a consultant and treatment provider to professional athletes in the NFL, NHL, and CFL. He can be contacted at firstname.lastname@example.org or through hamiltonbackclinic.com.