Physical Therapy Practice Management Metrics
Number Soup
How can Shannon really use the data she has available in her practice?
“Things have been going really well at work,” Shannon started, ladling soup into bowls at the family dinner table.
Mike added salad to the kids’ plates. “That’s good news! Profits are up, good growth this quarter, things like that?”
“I guess I was thinking more about the staff being happy and busy.”
“That’s good, too,” said Mike.
“We keep track of those other things too, of course. Income, expenses, how many patient referrals we get, how many referrals per doctor, how many payers and what percent of revenue each one represents, how many appointments per day and how many appointment we could have, how many people open the emails we send–”
The kids were giggling, and Shannon smiled, too. “I can’t even list all the things we keep track of.”
“How can you keep track of all that?” Mike asked.
“I don’t keep it all in my head,” Shannon responded, buttering a piece of bread, “but I could look it up any time.”
“So which metrics do you really use?” Mike asked. “What lets you know if you’re on track?”
“The bank balance, of course,” said Shannon. “That’s what really matters, right? I don’t have time to keep track of all that other stuff every day.”
“Yeah, but your bank balance is a trailing indicator, not a leading indicator,” Mike said. “By the time you see a problem there, you — well, you have a problem.”
“I guess all the data is there if I ever need it, but mostly I’m comfortable with what I can learn by looking and listening. My business is all about people.”
“Do you really want the kids to hear you disparaging math like that?” Mike teased. “Seriously, I know what you mean. You’re busy all the time — we have two businesses and three kids, so how could we be anything but busy? But somewhere in all those numbers there’s some information that will really make a difference for you. For me, it’s dinner reservations and how many times we can turn the tables.”
“I’m not against math. I’ve gotten a lot out of that data when I’ve had time to get into it. I just know my limits. How about some more soup?”
“No, thanks. I know my limits, too.”
The kids were giggling again. Mike and Shannon shared a smile.
Shannon wondered, though — was she missing out on something by ignoring all those numbers, or was she just being realistic?
How can Shannon really use the data she has available in her practice?
Disclaimer: For HIPAA compliance, all characters appearing in this post are fictitious. Any resemblance to actual persons or actual events is purely coincidental.
Data is awesome, but it takes time to sift through it in order to figure out what needs to be done. Shannon can use her data, but she has to then decide how long she is willing to spend making sense of her information and then come to a conclusion about what needs to be done. Then, she has to implement a plan, measure it, and start all over. What she would really benefit from is a system that organizes data and makes action items out of that data automatically for her and her staff to do.
I like what Mike told Shannon above… “Yeah, but your bank balance is a trailing indicator, not a leading indicator,†Mike said. “By the time you see a problem there, you — well, you have a problem.â€
Shannon’s business is all about people, but she needs to know how those people affect her bottom line, and how many people she needs to see in order to stay profitable. That’s why it’s essential to keep track of the correct metrics, and be flexible enough to make course corrections when those metrics suggest a change is necessary.
Mike is right…by the time you see a problem you will have another problem. Shannon’s wrong by ignoring the data. It’s good she sees how happy her staff is and how they’re being busy but it’s important to realize there are other indicators that show how good their practice is doing as well.