Introduction:
MM Medical
A CDAP project case study.
Dr. T bought MM Medical Laboratories three years ago and has been expanding organically and externally since then. MM Medical Laboratories primarily provide analytic or diagnostic services, including body fluid analysis, generally to the medical profession or to the patient on referral from a health practitioner.
The Goal
The goal is to increase patient volume, demand, and consolidation to leverage rising costs. Dr. T is hoping that one day they can exit the company with a private equity (PE) firm or another player in the industry.
Challenge: No time to manage staff
Laboratories are contending with a shortage of skilled labor as baby boomers, which constitute a significant portion of the industry’s workforce, retire, and fewer individuals pursue healthcare professions. Dr. T needs to recruit and analyze his staff performance at a higher speed.
For each new acquisition, it would take over four years to replicate a new diagnostic clinic and to obtain a good strong client base. With new staff and new clients, Dr. T needs to automate their onboarding and their administrative processes. Difficulties in acquiring accounts and third-party payer contracts are also some of the challenges. Dr. T needs new systems to streamline his marketing and CRM processes.
Challenge: Lack of Financial Clarity
With rapid growth, Dr. T needs to understand the financial side of the business, quick. He needs reporting on partnership & new acquisition costs, staff utilization, and return on invested capital. And overhead and profit margins must be live and available.
Currently Dr. T’s full review financial reporting is generated by his accountant once a year. His bookkeeper/admin runs his books for him but the data and results are not current. And reports are generated on the fly. He doesn’t have P&L analysis on licensed staff and external partners.
Solutions:
We conducted an assessment of the current phase to better understand MM Medical Laboratories’ financials, business drivers, and challenges. After spending time with Dr. T and his key employees and accounting team collecting data, we provided some possible solutions for Dr. T. We helped Dr. T understands the cost and resources required to implement the change. A cost-benefit analysis is provided.
After some correspondence and emails, recommendations are made on how to streamline MM’s marketing and patient onboarding process, and to provide financial reporting to help them understand which service and location is doing well.
CDAP Project Conclusion:
The strategic solutions provided to MM Medical Laboratories allow them to increase patient volumes and consolidate to leverage rising costs. The streamlined marketing and patient onboarding process, along with accurate financial reporting, increase recurring account revenue. The plan is cost-effective and sustainable, allowing MM Medical Laboratories to achieve its goals of growth and profitability.
The comprehensive digital adoption plan like this wouldn’t cost Dr. T much because 90% of the cost is covered by the CDAP. With the CDAP plan, Dr. T is also able to access a $100,000 loan from BDC at a 0% interest rate to implement the plan.
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