Optimize Your Clinic’s Financial Health: Essential KPIs for Success

There are many different KPIs to evaluate your clinic’s financial health. From monitoring trends in your clinic’s gross income and expenses over time to analyzing your profit margin, we utilize several KPIs to help you understand how the other KPIs are translating into financial success.

Monitoring Expenses and Identifying Outliers

Analyzing graphs of your expenses, and looking for outliers – large, unusual expenses that occur on a single day or through an isolated period – is important for your clinic’s financial health.

Tracking down the source of these types of large expenses can help avoid erroneous or even fraudulent expenses. It can also provide insights into how you may be able to better tighten up your monthly budget to increase net profits.

Tracking Gross Income and Attended Visits

Likewise, tracking your gross income to ensure it is changing predictably with changes in your attended visits is very important. If, for instance, your attended visits are going up, but your gross income is going down, it becomes crucial to look more closely at your billing efficiency KPI. This will help ensure you are not losing money due to billing issues.

Once the problem is identified through analysis of other KPIs, developing a plan to turn that trend around and begin to collect the money due to you is crucial.

Other KPIs for Your Clinic’s Financial Health

Additional KPIs that readily identify the financial health of your clinic are your profit margin, gross revenue and gross expenses per attended visit.

• Achieving a High-Profit Margin

In the services industry, it is typical to operate near a profit margin of 10%. Our clinic was operating at slightly over 20% in 2021 when we sold it, despite the large expenses we took on to build out a new facility. We were able to achieve that margin by closely monitoring our KPIs, keeping positions staffed, and overall running a clean, friendly clinic that welcomed everyone in for therapy.

• Improving Income and Profit Margin

As mentioned, evaluating the billing efficiency and gross revenue per attended visit can increase income and thereby increase your profit margin. Besides, by monitoring and decreasing your expenses per attended visit, you can improve your profit margin and increase net profits.

Expenses will typically increase as your clinic gets larger; however, you’d ideally like to see the expenses per attended visit remain relatively constant. If those are increasing, re-evaluating your budget and cutting out extraneous expenses may be needed to maximize profitability.

Partner with KCD Pros

At KCD Pros, we evaluate and assess all these KPIs for you with our custom KPI solutions. We’re confident that if you follow our advice on managing your KPIs and put similar efforts into managing other facets of your clinic, you, too, can operate at margins well above industry standards.

Contact us today to learn how we can help you achieve financial success for your clinic.