Physicians are getting more and more creative about adding new revenue streams to their medical practices and with payers consistently cutting reimbursements, it has become somewhat critical.
A host of broader trends are reshaping healthcare norms. Outpatient services have exploded over the past couple years, shifting regulations have changed the way physicians capture revenue (sometimes for the worse), telehealth is replacing the need for many in-person visits, and more. The pandemic triggered most of these changes, and many have proven viable even after the most intense COVID shocks.
Amid it all, physicians may be wondering how they can modify their business models to keep up.
Fortunately, there are numerous ways to add new revenue streams—most of which have benefits beyond the purely financial. Best of all, patient care may significantly be improved when it is provided in a vertically organized fashion.
6 potential new revenue streams for your medical practice
- Add in-house lab testing and/or radiology services. Rather than recommending patients to external laboratories or imaging facilities, acquire equipment and staff that lets you perform in-house testing. Radiology, in particular, is a top growth area—valued at $94.7 billion in 2020, it is expected to grow at a compound annual growth rate of 7.3% through 2028. Of course, testing instruments are expensive and hiring new staff means making investments whose ROI may not be immediate. Make informed calculations and projections based on your patient insurance profile and volume before jumping in.
- Provide remote patient monitoring (RPM) services. Before the pandemic, Medicare only reimbursed physicians who were remotely monitoring patients with chronic conditions. Now, Medicare reimburses for both chronic and acute RPM. RPM lets you keep track of key patient condition indicators like weight and blood pressure without having to schedule visits. Patients overwhelmingly view RPM positively, indicating a likelihood of high uptake rates.
- Capture pharmacy revenue for prescriptions you already prescribe. While most physicians already know of in-office dispensing, many have been reluctant to adopt it or have moved away from it. The challenges of bringing pharmacy services in house are primarily related to compliance, and the time/workload commitment for your staff to fill each medication. Plus, you’ll have to reallocate space for it and develop a substantial inventory. However, physicians are now utilizing mail-order pharmacy claims purchasing models to generate additional income, similar to that used by some of the largest pharmacy benefit managers. Additionally, patients benefit from improved medication compliance and appreciate the convenience of not having to make a second trip to the pharmacy.
- Provide in-office durable medical equipment (DME) and orthotics. For decades, physicians have been dispensing routine DME and orthotics, such as canes and back braces, from their offices. Consider adding higher level equipment like bone stimulators or devices for deep venous thrombosis prophylaxis or cold compression therapy.
- Use imaging modalities (e.g.: ultrasound) during procedures. The use of diagnostic imaging has expanded dramatically in recent years. For example, the use of ultrasound (U/S) during office-based procedures improves the accuracy of needle placement for injection of corticosteroids, hyaluronic acid, or other therapies. Most payers recognize the benefits and reimburse for the use of these adjuvant modalities.
- Offer in-house physical therapy. After seeing a dip during the pandemic, the physical therapy market is back on the climb. Another realm of healthcare made easier by outpatient services, the physical therapy market size is set to reach $43 billion by 2025. Adding in-house physical therapy likely means adding personnel, but physicians with the right patient profiles will likely meet existing demand.
Adding new revenue streams starts with a mindset of continuous growth. Many new healthcare standards are more beneficial for both patients and physicians—like outpatient care, which increases physician revenue ceilings while decreasing costs for patients. But in each case, physicians should perform careful financial and compliance audits to verify the viability of new revenue opportunities.