healthcare outlook study - citizens bank · healthcare outlook study ... • level of confidence in...

Healthcare Outlook StudyTHE STATE OF THE INDUSTRY FOR INDEPENDENT

MEDICAL AND DENTAL PRACTICES

Healthcare Outlook Study | 2

ABOUT CITIZENS BANK HEALTHCARE PRACTICE BANKING

Our team of HealthCare Specialists offers tailored and comprehensive financial solutions to help you, your employees and your practice succeed. Backed by the power of a leading financial services provider, we know our clients well, respond quickly and provide solutions to help you achieve the potential of your practice.

Offering both healthcare industry insight and an understanding of the unique needs of medical and dental practices, our HealthCare Specialists know what it takes to achieve financial success, at every stage of your practice.

For more information, please visit businessbankinghealthcare.com.

ABOUT CITIZENS BANK

Citizens Bank, one of the nation’s leading banking institutions, is a division of Citizens Financial Group Inc., one of the nation’s oldest and largest financial institutions, with $138.2 billion in assets as of December 31, 2015. Headquartered in Providence, Rhode Island, the company has offices in 20 states. Citizens offers retail and commercial banking products and services to individuals, small businesses, middle-market companies, large corporations and institutions. We partner with clients to create customized financial solutions to achieve their objectives, drawing from our comprehensive array of services.

Citizens operates via subsidiaries Citizens Bank, N.A., and Citizens Bank of Pennsylvania. Additional information about Citizens Bank and its full line of products and services can be found at citizensbank.com.

©2016 Citizens Financial Group, Inc. All rights reserved. Citizens Bank is a brand name of Citizens Bank, N.A. and Citizens Bank of Pennsylvania. Member FDIC.


CONTENTS Opportunities and Challenges for Independent Healthcare Practices .............................................................................. 4

Key Findings Summary ...................................................................................................................................................... 4

Methodology ...................................................................................................................................................................... 5

Overall Independent Healthcare Practice Outlook ....................................................................................................... 6

Expected Revenue Growth Despite Challenges ........................................................................................................... 6

Maximizing Revenue a Top Focus ................................................................................................................................. 7

Meeting Financial Goals Harder than Growing Patient Base ....................................................................................... 8

Complicated Regulatory Environment ......................................................................................................................... 8

Negative Influences on Healthcare Practices ............................................................................................................... 9

Dental Practice Outlook ................................................................................................................................................. 10

High Demand and Strong Competition ....................................................................................................................... 10

Marketing is a Goal and a Challenge........................................................................................................................... 11

Keeping up with Technology is a Struggle .................................................................................................................. 12

Insurance Landscape Negatively Affects Quality of Care .......................................................................................... 13

Medical Practice Outlook ............................................................................................................................................... 14

Insurance a Major Headache for Physicians ................................................................................................................ 14

Doctors Meet Challenges with Confidence ................................................................................................................ 15

Compliance Issues Major Source of Concern ............................................................................................................. 16

Not Much Appetite for External Growth Strategies ................................................................................................... 17

Success in Challenging Environment .......................................................................................................................... 18


OPPORTUNITIES AND CHALLENGES FOR INDEPENDENT HEALTHCARE PRACTICESIndependent and privately-owned medical and dental practices are a critical component of our country’s healthcare ecosystem. Doctors and dentists appreciate the autonomy of not being affiliated with a healthcare system, and patients benefit from a more personalized experience. However, smaller dental and medical practices face unique challenges, especially in the current legislative, insurance and regulatory environment.

What is the current state of independent and privately-owned medical and dental practices? What is the outlook for these small practices over the next five years?

To find out, Citizens Bank, in conjunction with Market Strategies International, recently conducted a study of 450 medical and dental practices with fewer than 10 doctors or dentists and revenue between $500,000 and $5 million. The exact proportion of the independent healthcare market that this represents is difficult to know. However, based on previous work conducted by the Health Policy Institute1, among others, which report that approximately 80% of practices have fewer than 10 employees, it is likely that the current study represents a majority of independent healthcare practices.

As such, the study provides insights into how practice leaders view the current and future healthcare landscape, including:

• Expected growth over the next five years

• Top business objectives for future success

• Level of confidence in achieving goals

• Internal and external factors affecting healthcare practices

KEY FINDINGS OF THE 2016 HEALTHCARE OUTLOOK STUDY INCLUDE: • More than half of all practice leaders expect their

profits to grow over the next five years.

• Dental practitioners have a more positive attitude about future revenue and profit growth than medical practice leaders.

• Patient levels are expected to increase while staffing levels remain stagnant placing additional pressure on the healthcare provider.

• Maximizing revenue through new patient acquisition and improved operational efficiency is a key goal for the healthcare industry.

• The current insurance landscape is causing significant challenges for the healthcare industry.

• Dental practices see high demand for the services they offer, but a lack of marketing expertise along with strong competition stand in the way of growth.

• Medical practices struggle to keep up with a complex legislative and regulatory environment that includes the move to electronic medical records and ICD-10 compliance.

• Despite the challenges, some medical and dental practices are not only surviving but thriving by taking advantage of external opportunities such as securing financing to meet business needs like upgrading technology or hiring additional staff to better handle a more complex regulatory landscape.


MethodologySurvey Population Independently and privately owned medical or dental practices, with 10 or

fewer MDs (if medical) or DMDs/DDSs (if dental) and have annual revenues of $500,000 to $5 million, in the states of MA, NH, VT, CT, RI, NY, PA, NJ, DE, OH and MI

Profile of Survey Respondents

Respondent is a decision-maker for day-to-day operations or M&A activities or financial planning/management

Total Completes 450 (total)265 (medical)185 (dental)

Data Collection August-September 2015

Survey Method Web-based survey; ~15 minutes in lengthMargin of error at the 95% confidence level:

+/- 4.7% for total sample (450)+/- 6.3% for medical (265)+/- 7.4% for dental (185)

Survey Partner Market Strategies International, Livonia, MI


EXPECTED REVENUE GROWTH DESPITE CHALLENGESThe majority of independent dental and medical practice leaders foresee revenue growth over the next five years, and 4 in 10 expect to see their profit margins improve during the same time period. Dental practice leaders are more bullish than their medical practice counterparts about the future. Nearly three-quarters of dental practices expect higher revenues over the next five years, compared to just 37 percent of medical practices.

37% 24% 72% 62%52% 40%

Revenue increase Profit increaseTotal

Revenue increase Profit increaseMedical

Revenue increase Profit increaseDental

Five-Year Profit and Revenue Outlook

A practice’s readiness for future growth depends upon a number of factors, including staffing levels and patient trends. As shown below, roughly one-third of practice leaders expect staffing levels to increase over the next five years; however, more than 7 in 10 healthcare practitioners anticipate the number of patients to increase, and less than 1 in 10 anticipate the average length of appointments to increase, which could strain the quality of care.

Already time-crunched doctors and dentists may find that they have even less time to spend with each patient, which could potentially impact both patient care and patient satisfaction. This trend toward shorter patient visits is expected to be more pronounced on the medical side.

% of Healthcare Practitioners anticipating increase in patients, employees, etc.

Number of patients 71%

36%

30%

30%

9%

Number of physician assistants ornurse practitioners/dental hygienists

Number of other employees

Number of MDs/DMDs/DDSs

Number of visits per patient

Average length of appointmentper patient

Significantly higher than Medical/Dental at 95% confidence level

34%

67%

39%

34%

26%

29%

10%

34%

34%

78%

31%

30%

8%

Total Medical Dental

Overall Independent Healthcare Practice Outlook


“�I’m�not�able�to�spend�the�time�with�my�patients�that�I�think�is�necessary�due�to�decreased�reimbursement�and�paper�work�that�is�progressively�increasing.”

“�Basically,�instead�of�spending�20�minutes,�now�you’re�given�about�four�minutes,�because�the�only�way�you�pay�your�overhead�is�to�run�a�factory�and�see�more�and�more�patients.”

- Medical respondent

MAXIMIZING REVENUE A TOP FOCUSMaximizing revenue tops the list of business objectives for healthcare practitioners. Tied to this goal are the objectives of acquiring new patients and operating more efficiently to improve profit margins. Among dental practices, new patient acquisition is the number one objective, significantly higher than for medical practices.

Reflective of a tough environment for independent and privately-owned healthcare practices, one-third of practitioners cite “staying in business” as a key goal. This concern is more prevalent in the medical field, where declining insurance claims reimbursements and a challenging legislative and regulatory environment have made it harder for small practices to thrive.

The study shows that healthcare practices are more focused on maintaining their practices than on pursuing external strategies, such as practice acquisitions, sales, relocations or expansions.

Top Business Objectives

Maximize revenue 60%

33%

34%

50%

53%

16%

Acquire new patients

Improve operational efficiency/profit margins

Stay in business/survive

Upgrade technology*

Reduce debt

Significantly higher than Medical/Dental at 95% confidence level*Upgrade technology (medical/dental equipment) and upgrade technology (office equipment, including IT systems) combined

Totaln=450

63%

28%

46%

51%

42%

15%

Medicaln=265

55%

41%

17%

49%

69%

18%

Dentaln=185

However, and of particular note, medical practitioners are more likely to list hiring new staff as an objective than dental practitioners (17% vs 8%). Conversely, dental practitioners are significantly more likely to cite selling the practice than medical practitioners (10% vs 3%).


“�Acquiring�new�patients�and�maximizing�revenue�are�somewhat�within�my��control.�However,�the�survival�of�practices�seems�very�vulnerable�to�outside�market�forces.”


MEETING FINANCIAL GOALS HARDER THAN GROWING PATIENT BASE While healthcare practice leaders have a clear idea of their objectives, they do not report feeling highly confident about achieving their revenue and profit targets. However, there is hope. About 6 in 10 healthcare practice leaders are moderately confident that their practice can maximize revenue, operational efficiencies and profit margins. Given the right tools and education, this group of doctors and dentists would likely become more confident in their ability to achieve their objectives.

On the positive side, more than half of practitioners have a high level of confidence that they can attract the necessary new patients to support future goals. Six in 10 feel strongly that they know what to do to stay in business, with this number jumping to 78 percent among dentists.

Level of Confidence in Achieving Top Business Objectives




Maximize revenue


Total Medical Dental

55% 43% 3% 58% 38% 4% 52% 47% 2%

78% 22%

38% 56% 7%

42% 57% 1%

59% 36% 5%

26% 70% 5%

30% 58% 12%

63% 33% 4%

30% 64% 5%

35% 58% 8%

High Medium LowTOP-3 BOX MID-4 BOX BOT-4 BOX



COMPLICATED REGULATORY ENVIRONMENTBy far, the biggest issues facing both medical and dental practices are legislative changes and compliance requirements, such as the move to electronic medical records and the required usage of ICD-10 billing codes. All medical practices face training, software compatibility and vendor readiness issues, but these issues could be exacerbated for smaller practices that will face more of a financial burden due to rejected claims from not using ICD-10 coding and lower Medicare reimbursement from non-compliance with the government’s “meaningful use 2” requirement for electronic records.

The political climate and the general state of the economy round out the negative factors influencing the success of small healthcare practices. For smaller practices with revenues between $500,000 and $1,000,000, each of these top 3 negative factors has even more of an impact than it does on larger practices.


“�The�doctors�are�spending�all�day�finding�codes�and�all�day�writing�notes,�so�there’s�no�time�to�see�a�patient�anymore.”


NEGATIVE INFLUENCES ON HEALTHCARE PRACTICES

Impact on Practice (Negative)

Legislative changes/compliance requirements 44%

17%

20%

29%

36%

18%

Political climate

General state of economy

Level of competition

Need for technology upgrades

Employment market


Totaln=450

45%

23%

16%

29%

37%

18%

Medicaln=265

43%

9%

26%

30%

34%

17%

17%Changing demographics and patient profile 18% 15%

Dentaln=185

“�The�more�EMR�regulations�that�we�have�is�adding�more�and�more�overhead.�Overhead�is�a�big�problem�for�us.”



Over the next five years, small dental practices will try to maximize revenue by growing their patient bases. For 7 in 10 small dental practices, acquiring new patients is the top priority. However, with increasing challenges caused by increased competition and lack of marketing expertise, just over half of dental practitioners feel highly confident in their ability to meet this goal. Upgrading technology and reducing debt are other top priorities.

Top 5 Business Objectives - Dental


Maximize revenue


Upgrade technology*

Reduce debt

*Upgrade technology (medical/dental equipment) and upgrade technology (office equipment, including IT systems) combined

41%

49%

55%

69%

18%

n=185

HIGH DEMAND AND STRONG COMPETITION The study shows market potential: 92 percent of practitioners moderately or strongly agree that there is a high demand for the type of dental services my practice offers. More than one-quarter of independent dental practices feel that the level of competition will have a negative impact on their practice in the next five years, a significantly higher percentage than for their medical counterparts. The study shows that most dental practice leaders perceive other small practices to be more of a threat than corporate practices.

Level of Agreement - Dental

In our area, there is high demand for the typeof dental services my practice provides

In our area, there is a high level of competition for patients

Utilizing dental equipment at capacity is abigger challenge than financing for one

Growth and influence of corporate dentistry companiesin our area is impacting my practice negatively

My practice has expanded/plans to expand the roles ofdental hygienists and associate (non-owner) dentists

Staff consistency and continuity is an issuemy practice is facing on an ongoing basis

n=185 High Medium LowTOP-3 BOX MID-4 BOX BOT-4 BOX

45% 52% 3%

39% 51% 10%

16% 65% 19%

17% 57% 27%

12% 45% 43%

12% 34% 54%

Dental Practice Outlook


“I�had�many�patients�leave�me�to�go�to�one�of�those�practices�[corporate�dentists]�because�that’s�what�their�insurance�covers,�and�six�months�to�a�year�later,�a�great�majority�of�those�patients�are�back�in�my�care.”

- Dental respondent

MARKETING IS A GOAL AND A CHALLENGEIn a competitive market, how can dental practices set themselves apart and acquire new patients? Marketing is both the answer and the challenge. Seven in 10 small dental practices name word of mouth and patient referrals as their most-used marketing tool. While word of mouth is effective, its reach is limited. That’s why three-quarters of dentists have a practice website and many also turn to social media and participation in community events.

More traditional marketing tools, such as advertising in local print publications and targeted mail are far less popular.

% of Dental Practices Using Marketing Tools

Practice web page

Word-of-mouth, patient referrals*

Social Media

Participation in community events

Advertisement in local papers/magazines

*Only asked if used as the most relied method

50%

59%

70%

73%

28%

Targeted direct mail in the practice area

Network referrals*

Mass mailing in the practice area

Radio commercials

TV commercials

4%

10%

13%

19%

2%

Physician/hospital referrals 2%

n=185

Even in a competitive market, 30 percent of dentists struggle to see the value in marketing. For those who do, lack of time and expertise can make marketing a “back-burner” activity.


“�Establishing�a�connection�with�all�our�patients�-�from�the�front�desk�team,�assistants,�hygienists,�and�doctor�-�is�very�important.�We�focus�on�this�type��of�customer�care�in�the�anticipation�that�‘word�of�mouth’�will�help�our��practice�grow.”

- Dental respondent

KEEPING UP WITH TECHNOLOGY IS A STRUGGLE Upgrading dental technology is critical to many practice leaders looking to thrive in a competitive business environment. Nearly 25 percent of dental practice leaders cite upgrading to digital radiology, digital impression systems and other patient care technology as a key business objective. But, many feel they need help in this area: just 4 in 10 are highly confident in their ability to implement new dental technology.

Recognizing the need to “keep up with new technology,” about half of dental practices have or will turn to lending partners for short- or long-term financing for technological upgrades. Purchasing or upgrading practice management/office technology is another common use of financing.

Uses for Additional Capital - Dental

To purchase new medical/dental equipment

To purchase new/upgrade business tech./software/IT

To pay for capital exp. other than tech./equip./property

To help finance ongoing operations

To lower/eliminate debt obligations

22%

42%

39%

49%

17%

To invest in advertising and marketing initiatives

To help hire additional staff

To develop new service offerings

To pay for new property/assets

To make own practice more attractive to potential buyers

10%

15%

15%

15%

10%

22%

To purchase or acquire (an)other practice(s)

Short-term financing(12 months or less)n=41

9%

32%

33%

55%

17%

23%

11%

6%

18%

9%

21%

Other reasons 5% 5%

Long-term financing(more than 12 months)n=66


“�The�other�challenge�is�the�learning�curve�on�learning�how�to�use�the�equipment�and�presenting�the�value�and�the�benefit�of�it�to�the�patient.�So�I�am�right�in�the�middle�of�that�learning�curve.”

- Dental respondent

INSURANCE LANDSCAPE NEGATIVELY AFFECTS QUALITY OF CARERecent changes in the insurance industry have created challenges for small dental practices: 4 in 10 say that current insurance plans are forcing them to sacrifice service quality. At the same time, two-thirds agree that current insurance plans are driving down profit margins. While many dental practices would like to offset diminishing margins by focusing on higher margin services, the reality is that many practices cannot meaningfully change the services they offer to their patients.

“�Insurance�companies�are�paying�less�and�less�for�the�treatments.�Sometimes�they��are�not�even�covering�the�treatments�that�are�best�for�the�patients.”

- Dental respondent

Today’s independent dental practices see their revenue sources as fairly evenly split between basic restoration services, major restorative services and preventative services.

Revenue Breakdown - Total

Idealn=183

Currentn=183

Basic restorationservices

34%

Major restorative

services

35%

Preventativeservices

33%

Basic restorationservices

29%

Major restorative

services

40%

Preventativeservices

32%

“�We’re�not�trying�to�do�one�service�more�than�anything�else;�just�high�quality��and�we’re�not�going�to�focus�on�doing�more�implants�and�root�canals�that��reimburse�higher.�That’s�not�what�I’m�in�it�for.�I’m�fine�with�what�we�have.”

- Dental respondent


Medical practice leaders, like those in the dental field, strive to build revenue, improve operational efficiency and acquire new patients. However, their task in achieving these objectives is complicated by a number of internal and external challenges – from the need to recruit new staff and see more patients to burdensome insurance and regulatory requirements. As a result, nearly half of medical practice leaders cite “staying in business” as a top goal and less than 25 percent say they have a clear view of where their practice will be in five years.

Top Business Objectives - Medical

Maximize revenue




Upgrade technology*


42%

46%

51%

63%

28%

n=265

INSURANCE A MAJOR HEADACHE FOR PHYSICIANSOne of the major inhibitors to future growth is a challenging insurance landscape, with roughly two-thirds of practice leaders strongly agreeing that current insurance plans are driving down their profit margins. Likewise, 3 in 5 agree that the current economy has led to employers offering cheaper insurance plans, which negatively affects practice profits as patients put off care and medical practices receive lower levels of reimbursement for care provided. In fact, 6 in 10 medical practice leaders say that static or declining insurance reimbursements are negatively affecting margins.

“�Our�practice�loses�patients�because�we�cannot�participate�with�their�plan…�Patients�do�not�always�understand�their�insurance�plan�and�do�not�know�that�certain�procedures�are�not�covered.�We�spend�a�great�deal�of�time�educating�patients�and�they�are�often�still�dissatisfied�because�they�are�paying�more�for�insurance�and�receiving�fewer�services.”


Medical Practice Outlook


Level of Agreement - Medical

Current insurance plans are driving profit marginsdown for health care providers

Current state of the economy is forcing employersinto cheaper insurance plans

Current insurance plans are forcing health careproviders to sacrifice service quality

Current business landscape is forcing my practice toconsider a merger with another practice

Current business landscape is forcing my practice toconsider an acquisition of another practice

Patient fraud is a major concern in my practice

n=265

68% 29% 3%

62% 33% 5%

50% 44% 6%

18% 37% 46%

10% 35% 56%

6% 36% 58%

Employee fraud is a major concern in my practice 4% 33% 63%


Service quality is also at risk, with nearly half of medical practices agreeing that current insurance policies will force them into the conflicting goals of seeing more patients but spending less time with each one without an increase in staff.

DOCTORS MEET CHALLENGES WITH CONFIDENCE However, all is not “doom and gloom” in the world of small medical practices. Fifty percent of medical practice leaders expect profits to increase over the next five years. Additionally, the vast majority of medical practice leaders have at least moderate confidence in their ability to maximize revenue, improve operational efficiency and acquire new patients over the next year. Despite the challenges, almost all practice leaders report at least a medium level of confidence that their practice will survive the challenges.

“�This�year�we’re�looking�at�about�10%�growth�in�terms�of�gross�revenues.��I’m�pretty�satisfied�with�that,�if�I�could�maintain�10%�growth�every�year�I�think��that�would�be�great.”


Delving into the details, the percentage of medical practice leaders who feel highly confident they can meet their top five financial goals is lower than the percentage of those feeling moderately sure. However, given the right information and guidance (e.g., cash flow management consultation, service offering optimization, human resource management, etc.) the less-confident group could grow more certain in their abilities to successfully take their practice into the future.


Confidence in Achieving Goals(Level of Agreement) - Medical

Maximize revenue




Upgrade technology*

30% 58% 12%

26% 70% 5%

59% 36% 5%

58% 38% 4%

44% 56%



When asked what gave them the confidence in their future success, medical practitioners cite their recent track record, their team, hard work and having the appropriate systems and plans in place.

“�My�partners�and�I�are�all�on�the�same�page�and�are�committed�to�making�the�practice�prosperous.”


COMPLIANCE ISSUES MAJOR SOURCE OF CONCERNDespite strong faith in their abilities to thrive, small medical practices face a myriad of regulatory and compliance issues, including the mandated move to ICD-10 coding and the transition to digital record-keeping. Nearly half of medical practice leaders are highly concerned with legislative changes and compliance issues.

For small medical practices, the move to electronic records can be a huge and time-consuming undertaking that places a burden on the practice. However, the majority of physicians recognize the benefits of being able to better track patients and improve coordination of care. Three-quarters of medical practice leaders express medium to high agreement with this statement: Electronic medical records have benefits for my practice.

While many practices feel that staffing levels will remain stagnant, among those that do expect to hire new staff, about half will do so to help with tasks associated with legislative changes. So, these new employees will add overhead, but will not directly contribute to profits by helping ease the patient load.

HIPAA compliance creates additional pressures on my practice

Meeting PCI compliance requirements is awaste of time for my practice

The switch to electronic medical records has been/is a big burden on my practice

Electronic medical records have benefits for my practice

43% 46% 11%

33% 51% 15%

53% 29% 18%

31% 43% 26%


Level of Agreement - Medicaln=265


“�Complying�with�government�regulation�such�as�ICD-10,�EMR,�and�meaningful�use�are�huge�concerns�for�my�practice.”


NOT MUCH APPETITE FOR EXTERNAL GROWTH STRATEGIESAs with dental practices, independent medical practices are focused on streamlining internal operations over external growth initiatives. To position themselves for future success, many medical practices recognize the need to upgrade both medical and business technology, which they finance through short-term solutions. Long-term financing is more likely to be used for capital expenditures other than technology, equipment or property.

Uses for Additional Capital - Medical

To purchase new medical/dental equipment

To purchase new/upgrade business tech./software/IT

To pay for capital exp. other than tech./equip./property

To help finance ongoing operations

To lower/eliminate debt obligations

32%

40%

41%

45%

30%

To invest in advertising and marketing initiatives

To help hire additional staff

To develop new service offerings

To pay for new property/assets

To make own practice more attractive to potential buyers

23%

27%

23%

18%

8%

27%

To purchase or acquire (an)other practice(s)

Short-term financing(12 months or less)n=73

45%

20%

28%

32%

22%

28%

18%

19%

22%

11%

23%

Other reasons 7% 4%

Long-term financing(more than 12 months)n=74


SUCCESS IN A CHALLENGING ENVIRONMENT The current environment for independent medical and dental practices presents many challenges, including legislative changes, insurance issues and cash flow problems that could impact the quality of care if not carefully managed. To be successful moving forward, medical and dental practice leaders need to focus on:

• Cash flow management: With insurance reimbursements down and operating costs on the rise, effective cash flow management is critical. Small healthcare practices must understand their operating costs and the financial impact of regulatory compliance. Because factors such as the slow pace of insurance reimbursements are outside of a practice leader’s control, it’s essential that practices bill patients in a timely manner and have a proactive plan for dealing with delinquent accounts, taking full advantage of tools available to help with cash flow.

• Establish a line of credit: Having available funds to meet unexpected expenses is indispensable. With the added labor demands of increased regulation, the uncertainty of insurance reimbursements, new technology requirements and opportunities, and other business needs, sufficient cash on hand can mean the difference between success and failure.

• Human resource management: Effective human resource management is tied to optimal patient outcomes. That’s why it’s important to have trained and dedicated staff or external partners to deal with time-consuming regulatory and insurance issues so that medical and dental staff can focus on patient care.

• Marketing service and support: For too long, many healthcare practices have primarily relied on referrals for new patients. In a competitive environment, this is simply not enough. Practice leaders need to become familiar with other marketing tools, especially social media, which can effectively build awareness of a practice without a significant capital investment.

• Importance of technology: New medical or dental technology can be costly, but can often provide a competitive advantage (or ensure that a practice keeps pace with the competition). Practice leaders need to understand the expected ROI of an investment in medical or dental technology to determine whether the benefits of the technology outweigh the cost. In some cases, a practice may be able to attract new patients as a result of technology upgrades as long as the technology and its benefits are effectively marketed.

• Understand competitive landscape and implications: The healthcare landscape is more crowded than ever. In this environment, patient satisfaction is key to retention, which can lead to the acquisition of other patients through referrals. The challenge, of course, is to maintain the highest standards of patient care while being asked to do “more with less.”

Many times, healthcare practices will choose to partner with consultants or other third-party providers to assist with some of their challenges and provide valuable expertise in a particular area. When choosing a partner, a practice leader must make sure that the outside organization has a holistic understanding of the healthcare landscape and the practice’s needs, and can provide specifics on how its service can benefit the practice.

1Very Large Dental Practices Seeing Significant Growth in Market Share, Research Brief, HPI, August, 2015

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