Physicians Practice - April 2008 - (Page 69)

consultant, or colleagues in the area — to ﬁnd an institution with a so-called “private banking” division. And note that although many major regional and national banks have a group that specializes in physicians (and sometimes other professionals as well), individual branches of those banks may not be aware of its existence. documentation of your intentions and a more in-depth business plan, but the exercise of providing that information will ultimately strengthen the practice and hopefully make its ﬁrst years all the smoother. Alternative ﬁnancing sources are always available, too. Ask your accountant whether a venture capital A few of Borglum’s favorite insider tips on the details: • Avoid multicolored stationery. “It’s going to cost you extra to print everything for the rest of your life. Most practices spend thousands of dollars a year on business cards, patient education materials, etc.,” he says. “Keeping those costs down is smart, because they can reduce your proﬁtability signiﬁcantly.” • If you choose to have a logo developed, take heed: “It’s not a mistake to have THOSE COUNTERTOPS COST HOW MUCH? Just like in construction, there’s a real danger of underestimating the expenses for which you’ll need to plan — everyone knows someone who’s blown their kitchen remodeling budget by a triple-digit percentage. a logo. It’s a mistake to have the wrong logo.” Look at the design from the patient’s perspective. Avoid anything that reminds people of bodily ﬂuids (or solids) that your specialty deals with. • Consider whether different is really better. “Every little weird adminis- trative thing you do — like doing your own bookkeeping — pushes you a little further outside the mainstream and increases your risk,” Borglum maintains. As in marketing activities, common sense and an appropriate degree of deliberation will take you surprisingly far along the ﬁnancial road. Accountant Jerry Love sums it up: “Planning and anticipation of reality is a key part of being successful and not having ﬁnancial frustrations.” All this is not to say that you don’t need to establish a relationship with an individual banker. On the contrary, you most assuredly do, as this person will offer help and guidance at every stage of your career. She will also be able to assist in ﬂeshing out the pro formas. Once those documents are in good order, obtaining a loan is relatively quick and simple for most physicians. You may be asked to put up collateral, perhaps in the form of your home, but in many cases you will be able to bypass the formal SBA process if your lender is experienced with medical practices. Will the current economic downturn affect banks’ willingness to lend to upstart physicians? Probably. But healthcare remains a growth industry. Banks may require more detailed WWW.PHYSICIANSPRACTICE.COM firm is an option, for instance. Remember, any loan becomes vastly more complicated when you bring partners into the equation — it’s critical to consult with an attorney who can draw up the necessary protective documents. In most cases you can expect to enjoy a steady stream of patients eventually. How quickly they begin to arrive on your doorstep depends on factors like the strength of your marketing effort. It’s therefore critical to build sufﬁcient funds for a concerted marketing and PR strategy into the business plan. These activities will represent a signiﬁcant expense in the beginning, so they should be part of the initial ﬁnancial assumptions. A good marketing plan will help you keep that negative cash ﬂow period to a minimum. • Laurie Hyland Robertson is a senior editor with Physicians Practice. She can be reached at lchrobertson@physicianspractice.com. APRIL 2008 | PHYSICIANS PRACTICE | 69 http://WWW.PHYSICIANSPRACTICE.COM http://WWW.PHYSICIANSPRACTICE.COM

Table of Contents Feed for the Digital Edition of Physicians Practice - April 2008

Physicians Practice - April 2008 Contents The Bigger Picture: Medicare Decision Time Letters Physicians Practice Pearls: Outsource Your Pain Noteworthy Cover Story: Trial Lawyers Tell All Management: When It’s Time to Change Ask the Experts Technology: Do You Know Where Your Data Is? The Tech Doctor: Are Your Discarded PCs Really Clean? Billing & Collections: Playing Hardball The Administrator's Desk: Recruiting for Patient Satisfaction Start It Up: Finance - Mastering the Numbers Game Coding The Great Practice Makeover: Taking Care of Business Associates Classifieds Advertiser Index

Physicians Practice - April 2008

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