Fueled by the reformation in recent healthcare regulation, the healthcare industry as a whole is undergoing rapid change. This is especially interesting considering the industry hasn’t necessarily been considered a progressive industry in the past. According to PricewaterhouseCoopers, 2016 marks a remarkable shift in the way healthcare is distributed and how patients expect to receive care. A recent study by the international professional services company found notable trends like increases in mobile healthcare through app services, willingness to finance prescription drug expenses, and rising interests to seek out and utilize independent urgent care centers – like franchised medical practices.
Why Franchising Your Medical Practice Makes Sense
For physicians, nurses, and/or other healthcare industry professionals seeking to franchise a medical practice, now may be an ideal time to make that move. Increased numbers of people seeking healthcare access and treatment because of the Affordable Care Act makes franchise affiliates an attractive alternative to long lines and higher costs of hospital visits. Additionally, as the baby boomer generation continues to age the healthcare industry faces an influx of care needs and potential limitation of existing resources. According to an article by Entrepreneur magazine, franchise healthcare systems are poised “to serve more patients with fewer overhead costs.” Franchised medical practices make sense particularly for care providers offering routine services like yearly physical exams, preventative appointments, flu shots, teeth cleanings, and treatment of minor alignments like colds, broken bones, stitches, etc. Franchising a practice allows physicians to take the best practices from hospitals and implement them in a way that provides high-quality service at generally lower price points.
Independent Franchise Ownership Can Offer More Affordable Patient Care
It’s important to note that many urgent care centers are hospital-affiliated healthcare centers, not separate franchise businesses. Examples of successful franchise medical practices often operate independently of hospitals and are thus able to avoid lengthy paperwork process that involve insurance companies. These independent franchises are often able to offer comparable levels of service at drastically lower rates. The same Entrepreneur article referenced earlier interviewed Alejandro Badio, founder of the franchise medical practice OrthoNow. Badio stated, “If someone without insurance comes into an OrthoNow to see a provider and have an X-ray, it will probably cost $300–a bit more if they need an MRI or a cast. The hospital-affiliated urgent care down the street is four times that just for the assessment. The patient will have to finance $1,200 or put it on their credit card. Then [the clinic] will likely just refer the patient to the hospital.”
Steps to Take to Begin A Franchise
There are many considerations before franchising your medical practice. Before starting the process be sure to meet with your IMAFS financial advisor, an attorney seasoned in franchise development, your accountant, and other business professionals you employ. It’s important for each advisor on your team to provide you with best practices before venturing forward.
Many successful medical franchise models focus on franchisees who are licensed physicians and/or who employ licensed physicians. Nurses and physicians assistants are added employees that make for a well-rounded staff. However, on their own a nurse and/or physician assistant may lack necessary qualifications and licenses to begin a practice. Other considerations include formulating a business plan that is easily implemented in differing markets, creating effective marketing materials, establishing best practices, and building clientele.
As your financial advisors, it’s our goal to provide assistance and personal recommendations for your specific situation. Contact your Idaho Medical Association Financial Services financial advisor to discuss how potentially franchising your medical practice will affect your financial portfolio and financial goals.
Idaho Medical Association Financial Services is a financial and wealth management firm specializing in personalized financial guidance to accredited investors in the medical field. Areas of speciality range from investment planning and retirement analysis to in-depth services such as tax analysis and strategies, insurance and estate planning and financial planning. For a free financial consultation, please call: (208) 504-1736 or email firstname.lastname@example.org.