How to Transition from an Insurance-Based to a Cash-Based Practice
Transitioning from an insurance-based to a cash-based practice might seem like a scary thought, but plenty of chiropractors have made the switch.
If you’re trying to figure out how to transition from an insurance-based to a cash-based practice, you might be happy to know that according to the Chiropractic Economics Salary and Expense Survey, most patients are already paying on a cash basis: 40% of patients are cash, compared to 31% who use group health insurance for treatments.
How to Transition from an Insurance-Based to a Cash-Based Practice? Change Your Mindset
Making the switch does require a change to your mindset. Not every patient will want to convert to cash. You may lose a few people. However, you will also gain different types of patients.
Switching to cash doesn’t mean you must reject insurance patients. You are just shifting the burden to patients to seek reimbursement.
Define Your Marketing Niche
It helps to define your marketing niche. For example, when paying out of pocket, patients expect higher quality care. Since you are relieved of the burden to create care plans to fulfill insurance company reimbursements, you have more time to focus on care and not worry about whether you will get paid for doing the right thing for your patients.
You may also be able to offer discounts for treatments based on reduced overhead and administrative tasks. That can be a significant benefit, especially when trying to attract new customers.
Invest in Long-Term Care Plans
Long-term care plans offer the most consistent pay. They also tend to provide better long-term outcomes for patients.
A long-term care plan approach can also significantly increase long-term client retention. Most practices will shift their focus slightly from bringing in new clients to developing long-term relationships with patients, which increases client lifetime value.
Consider Product Extensions
Many chiropractors planning to transition from an insurance-based to a cash-based practice add product-line extensions to supplement their income and broaden their client base. These include providing products and services such as:
- Kinesiology tape
- Spa or sauna
Another strategy that many chiropractors have chosen is to expand into integrated health practices. While 64% of chiropractors operate independently, 27% operate within a multidisciplinary clinic setting, such as working in conjunction with a medical doctor or providing complementary services on-site, such as physical therapy, licensed massage therapy, or acupuncture.
Educate Patients about Cash Practices
One of the keys to transitioning a cash practice is educating patients about how it works and how it can benefit them. It’s important to discuss the cash model and educate clients about the health and wellness benefits of long-term care rather than just treating their immediate symptoms.
The key for patients is value. When they are paying cash rather than relying on insurance, they want to know exactly what they are paying for and why it’s important. Explaining the value of care plans should include both the health and financial benefits.
The Benefits of Switching to a Cash Practice
There are plenty of benefits of switching to a cash practice, not least of which is less paperwork. You no longer have to worry about arguing with insurance companies over what is considered appropriate care. With fewer restrictions to deal with, you decide what care should be given based on the patient’s needs and not what their insurance company will pay for.
It also helps reduce burnout. Due to insurance reimbursement cutbacks, chiropractors are often forced to see a large number of patients to be profitable.
Potential Roadblocks in Switching to a Cash Practice
Transitioning to a cash practice is not without its challenges.
One potential roadblock for some chiropractors is that they might not have prior experience running a cash practice. This means they may need to hire someone experienced to help them with their transition, including an accountant or bookkeeper who can handle the specific needs of chiropractors related to tax implications and compliance issues.
It’s important to do your due diligence before you leap, including looking for a practice management service provider that has deep experience with other chiropractic practices and understands your needs.
That’s where ChiroSpring can help.
How ChiroSpring Helps Power Cash Practices
ChiroSpring is the number-one cloud-based chiropractic EHR practice management software. Designed specifically for chiropractic practices and used by more than 1,000 chiropractors nationwide, CHIROSPRING provides the tools that you need to run an efficient and streamlined office.
When it comes to transitioning to a cash-based practice, ChiroSpring has the tools that you need to simplify operations, including:
- Integrated payment options (debit/credit/EFT, mobile, online)
- Automated posting to ledger
- Centralized billing records
- Everything regarding patient care in one centralized place
- Documentation for patients to file with insurance carriers
ChiroSpring reduces the administrative burden so you can spend more time with patients and run a more profitable practice.
ChiroSpring is an all-in-one practice management and EHR system built specifically for chiropractors to help them regain face-time with patients, spend less time on back-office tasks, maintain a limited staff, and save operational costs.
To see how ChiroSpring can help you simplify how you manage your practice, reach out to one of our specialists today!