Dr. Allen Miner: Welcome everybody to the UAC Best Practices podcast. I’m Dr. Allen Miner here D. with Dr. Brian Capra. Hey, Cap’, how’s it going?
Dr. Brian Capra: Hey, bud. How’s it going?
Dr. Allen Miner: Great.
Dr. Brian Capra: Excited to be here. Yeah, so welcome to UAC Best Practices. We hope that you get a little nugget or maybe several nuggets out of today that you can immediately take home and or take to your practice and implement and get results. So, we have Dr. Naota Hashimoto on the call. He’s a very successful practice. I’ve been friends for a few years now. Gotten to know him. Great guy. Very successful, business minded. Also has another business track stat, but I’m going to let Naota take it from here. I know your topic basically is profit with some bullet points underneath that. So, what do you have for the audience today?
Dr. Naota Hashimoto: Well, like a lot of people talk about increasing collections. Obviously, you go to conferences, you talk to other docs, everyone talks about collections, but the end of the day profit is the thing that matters. It’s a thing that our software helps a lot with. It’s a thing that Dr. Brian’s software helps a lot with. But it just, like I remember my first consultant, one of the first things you’d always have people do is these, like, raise your prices. You’ve had those prices for the last like 30 years or 20 years. So, I was like, sell for more. And how do you sell for more? One, you could just raise your prices, you could figure out how to increase the value, deliver different types of services. You could also, another thing that a lot of these docs do is they don’t really try to position themselves as an expert to someone. One of my mentors, Dan Kennedy, always talked about you need to be someone to someone. You need to be a who to a who. And that’s why they talked about like doing niches. Even if you’re doing straight chiropractic. I have friends and colleagues like just focusing on like things like migraines, focusing on like sciatica. Rather than just being a general practitioner, you want to be the cardiologist, the orthopedic hip replacement surgeon, stuff like that. So, like… Yeah.
Dr. Allen Miner: Something that jumps to my mind with the… It is interesting how we’ve all been in the rooms where everybody screams about their collections and how much they collect. And it’s this funny thing that it’s like, there could be the guy making 200,000… Collecting 200,000 and taking home 175 of it and the guy doing one or 2 million might be pulling from a line of credit to make a payroll. And so, profit’s such a big deal of it… We’ve talked in the past about Profit First. That book’s been a big influence on a lot of UAC but also, I’m kind of curious. I’ve been using… When we do calls for our staffing company, Chiro Match Makers, I have found one of the fastest ways to sum up a clinic is looking at revenue per employee. And there’s a lot to unpack here, but we’ve found if a practice is sitting around $250,000 of revenue per employee, not including the owner and that includes the doctor, a CA, anybody full-time, that practice is profitable. It’s the fastest way I’ve learned.
Dr. Allen Miner: Because a lot of people call us and they want an associate, they’re not in a position to afford an associate yet. And it was always taking a little time to dig out. People don’t know their numbers, they don’t know their profitability, they don’t know the revenue. But if I can figure out, all right, how many people are working for you? How much did you collect? Are you above 250,000 revenue per employee? It was the fastest. Like that clinic has profit in it. In so many ways, I want to dig into numbers like that because that’s really, to me, you’re a genius and your expertise is unpacking that. So, can we go a little deeper on the profitability and the levers that you talk about pulling those?
Dr. Naota Hashimoto: Yeah. Yeah, so it’s like one of the things that a lot of people don’t track, it seems like is your collection visit average. Like I know you guys track them, but like I was just blown away at how many people don’t. So, I was just like, they’ll look at patient visit average. And I’m not saying patient visit average is a bad thing or they’ll look at like total weekly visits, but like they don’t even look at like, what are we earning per visit? What is our expense per visit? But yeah, like those are big things. But yeah, like selling for more becoming an expert, that’s good. And then another thing for increasing profit is just sell more often. And that’s kind of an area that a lot of chiropractors do focus on, right? One way is you could get new patients. Like I always joke with my wife that every doc in it… It’s every kind of business. They just… What’s your problem? It’s like, I’m getting divorced. What do you need? New patients. New patients. The answer is like, new patients. My car’s broken. Now what do you need? New patients. And so like is a running joke in our house, like, when my wife’s going out to the grocery store, what do you need? I always joke like, new patients.
[laughter]
Dr. Allen Miner: It solves all problems, doesn’t it? I mean, and it’s a business, right?
Dr. Naota Hashimoto: I don’t know about that. I don’t know about that.
Dr. Allen Miner: You disagree?
Dr. Brian Capra: Yeah.
Dr. Brian Capra: Well, you can pump a whole lot of new patients into a broken system and have no retention on the other side and you’re really just spinning your wheels, right? The retention I think is pretty, a big.
Dr. Naota Hashimoto: Retention’s a good thing. Conversion is a good thing. Like I’m not saying that new patients isn’t good because, like getting more new patients and converting them is a good thing. Like another thing that I find is some people obsess about trying to get like 100% convergent. And then one of my mentors said, is like, “If you’re converting 95% of the people your prices are too low.”
Dr. Allen Miner: Totally. I just saw a thread on Facebook about that and nobody said that, but I’m like, yeah, if you’re converting that high you should be charging a lot more money.
Dr. Naota Hashimoto: Yeah.
Dr. Allen Miner: Or having more visits or it’s just like yeah, I can charge 20 bucks for a visit and have 100% conversion rate all day long. It’s…
Dr. Brian Capra: Yeah.
Dr. Naota Hashimoto: So, he said like two-thirds and three-quarters, like once you’re like going hovering it, like 80 plus percent is like, it’s time to increase your prices or your visits, your something because like too many people are saying yes. So that’s whole concept of price elasticity. And something that we track that a lot of people don’t track is like just getting people to finish their treatment plans. Like I remember last year I combed through several 100 chiropractors and just kind of looking at patient drop-off analysis with several 100 plus doctors and the median was somewhere between four and six visits where people are dropping off at. And it just like, if they just got them to 12, like that would double their practice. That would… Not double their profits, but like it would significantly… It’d get pretty close.
Dr. Brian Capra: And one thing that’s like a little nugget within that nugget is your patient stays for 12 visits as opposed to four more likely they’re going to get great results than they would have. Right. And they’re going to be happy and probably refer other people. So, this… The synergy and the snowball effect of just focusing on that one thing alone. Like, and you know this in the software business, a big number, if you’re looking at valuating… Valuations of companies is churn. Okay. You have these many clients, and you sell for this much a month, and this is your revenue, but what’s your churn? Which is basically what’s your rate at which you’re losing clients?
Dr. Brian Capra: Yeah. Right. And you don’t have the chiropractic churn rate, right? Like it’s not something people talk about a lot or want to admit. They love to tell you how many new patients they got and their conversion rate, but churn is like this dirty word I think in chiropractic sometimes but it’s such a powerful number.
Dr. Naota Hashimoto: Yeah.
Dr. Brian Capra: So just focus on that. Like you said, not only do you increase your revenue by, just say double, but that good customer experience turns into other customers. They refer their friends, their family. It’s an exponential growth.
Dr. Naota Hashimoto: Yeah. And like one of the things like, I’d say for me, like a turning point early on in my career is when we created a membership, like that’s when I started getting into marketing because like I was reading books about it early on in practice in like my second year and my business coach did it. But like I remember I started a membership and like it was quickly at 10 to 15K a month. And then that gave me the cojones to start writing my own copy and stuff like that, because I’d read books, but like, I didn’t want to pay money and run an ad. And I wrote some ads, they just totally bombed. But like I knew that it was like, okay, I got my rent covered, I got a decent chunk of my overhead covered and back then it was like me and my wife, we had crazy profits. It was just like me, her, one employee doing like a million dollars, and it was, we were making a decent chunk of cash, so.
Dr. Allen Miner: That’s awesome man. And it’s so much easier to go back to the original thing too. It’s worth saying, man, it’s easy to raise rates right now. Like the world is more expensive, inflation. We’ve jacked our weights way up. And it just, there’s no pushback. There’s never been an easy return.
Dr. Brian Capra: It spiked again right now. Yeah.
Dr. Allen Miner: To raise it.
Dr. Naota Hashimoto: Well, it’s just, yeah, eggs, meat, milk, gas, everything. Clothing. Electronics, like cars, like everything went up.
Dr. Brian Capra: There’s also a danger of being too cheap. Like people are like, “It’s so cheap. Why is it so cheap?” And you lose conversions because it’s so cheap.
Dr. Allen Miner: Yeah.
Dr. Brian Capra: When it, especially in a market where everything else is adjusted up and you’re like so cheap, there must be a reason it’s so cheap.
Dr. Naota Hashimoto: Yeah.
Dr. Brian Capra: And not a good one.
Dr. Allen Miner: We had pushback from only one patient, and we just quickly said, you realize you’ve been coming to us for six years. We used to pay our CAs 12, 13, $15 an hour. I’m like, Carl’s Jr and Starbucks now is paying $18 an hour. Like we have to be up around $25 an hour. So, the cost of having great people here it’s competitive. We’ve got CA stolen away. And we’ve seen that again over in the CMM side. So, you have to raise your rates to offset that. Like you just… A lot of chiropractors are just losing good people or eating it or not able to find a good person because they’re not willing to pay more because they don’t have the margin. And it’s as simple as this conversation, if you retain more people at higher price points for longer periods of time and give them better results and better customer service, which I know every… It’s basic principles, but it does get overlooked in our world, doesn’t it now?
Dr. Naota Hashimoto: Yeah. And then like just increasing efficiency. Like a lot of people always try to save themselves into a profit, and I’m not against like cost cutting and cutting expenses, but like, it’s kind of like that scarcity mindset where you see a lot of these, and it’s not just chiropractors, it’s just other people. They just try to save theirselves into a profit and there’s a ton of like people complain about things changing with the future, but like one of the things that has improved is you can have software that shows up that works 24/7. I know with Genesis you have billing AI. You can outsource your billing. You have single point management. With ours, we have like a lot of checks and balances. Like the main thing our software does is it shows your frontline people what to focus on. And then it could show the manager if they’re actually doing their work and they’re already paying for an appointment reminder system already, which is like the cost hours. But like people are still doing things on pieces of paper, running reports, filling out spreadsheets, running this. Or it just, I don’t know. It seems kind of like redundant to me.
Dr. Allen Miner: I hear you man.
Dr. Naota Hashimoto: So, like, I don’t know what you guys are finding with that kind of stuff. Sorry.
Dr. Brian Capra: We see it a lot, obviously.
Dr. Naota Hashimoto: Yeah.
Dr. Brian Capra: We see it a lot obviously on our side, it’s like they want to spend. You got to look at it as a return on investment, especially with software. Is the software saving you and or your team time doing manual labor, especially at $25 an hour now, where even they want to… For example, submitting a claim and on our side and then getting that to a clearing house, then getting the file back and all that work and then you add up how many hours that takes in a week. And we automate it for a fee. But like the fee to automate it is way less than you’re paying to a person. And sometimes people don’t look, think about automation and technology as an investment.
Dr. Naota Hashimoto: Yeah.
Dr. Brian Capra: Look at the cost. It’s like it should make you money. You should be able to point when I spend this money, it’s going to make me this much more or keep or save me this much more, right?
Dr. Naota Hashimoto: There are a couple things…
Dr. Brian Capra: And be consistent.
Dr. Naota Hashimoto: Yeah. Like there are a couple things I still like to track, even if you have to do it manually. Like one of the things we always tracked, now we do it automatically, but like looking at all the canceled and missed appointments and what percentage of them are getting rescheduled. And I found that if the front desk knew they’re getting measured on that they do a better job. And then we always tracked, like if we look at all the appointments that came in in the last week, what percentage of those people left with a future appointment? Because like people look at stats and I think like, you look at collections, which is a lagging indicator. If you’re an insurance-based practice, billing is not quite as lagging. And then you’re looking at like new patients, conversions, and visits, which are still lagging indicators, but those leading ones you could look at all the people that came in that owed money, that left still owing money. You could look at all the people that canceled or missed that didn’t get rescheduled, and you could look at all those people that came in and left without an appointment. And I find that those are leading indicators and if they track those even manually, I’d say it’s worth it. But we automate it because it’s a lot easier. So, like, I don’t know what kind of things you guys are recommending to track to make sure people are doing their work.
Dr. Brian Capra: Well, as far as a lever goes, that’s one of those things where it’s money on the shelf. It’s in your practice. It’s sitting there, you’re just not taking it. You’re just not measuring in a way that you can see it and taking it. Just money’s fallen through the cracks that way. There’s a lot of different things. So, like you said, you can sell more often, but then you can also sell not the same thing more often. You could sell something different [laughter] to the same people. That’s another thing. How do you add value to their life and sell something they need that they’re buying at CVS or whatever.
Dr. Naota Hashimoto: Yeah. One of the things we did in our practice years ago, I don’t do it anymore, but we did weight loss. We had all the people coming in for chiropractic, did weight loss. We had people coming in for weight loss and then we offered them chiropractic and then we added a laser, added decompression, added different therapies. And you could add those different things because people are coming in for back pain, but then all of a sudden, they got knee pain or shoulder pain or all these other things. And at a certain point, I added too many things and then when we have decided that it was too complicated and then we started stripping out things and… because like we’ve decided that we’re going to focus on pain-related services. But I got caught up in shiny object syndrome and I chased a few squirrels and decided that I needed to simplify though. And I’m pretty sure we’ve all done that.
Dr. Allen Miner: What was the worst one? The biggest worst investment?
Dr. Naota Hashimoto: Oh, the erectile dysfunction. That was probably the worst one.
[laughter]
Dr. Brian Capra: Erectile dysfunction.
Dr. Naota Hashimoto: So that was one and it…
Dr. Brian Capra: We don’t want to touch that.
[laughter]
Dr. Naota Hashimoto: Well, we’re in the Palm Springs area which has a certain type of demographic which was good for that. It just… And the thing is I’m a chiropractor. I had nothing to do with it. I didn’t do any consults and do all this stuff. It just created…
Dr. Brian Capra: Oh, now you’re saying you had nothing to do with it.
[laughter]
Dr. Naota Hashimoto: No. Well, it was my idea to bring it in, but the physician was doing it and stuff like that. It just created some awkwardness with the staff especially… And you have like, we’d have our females. Some of the females were okay doing… because we did shockwave and they did shots and we had one female that had no problems and then sometimes the male patients would request a male patient and there was a little… I mean, a male tech and it just created this extra friction that we didn’t need. No pun intended, but it was just… Yeah, I would say that was the worst one.
Dr. Allen Miner: Jack of all trades, no pun intended, is a master of none, right?
[laughter]
Dr. Naota Hashimoto: Yeah.
Dr. Brian Capra: Yeah. So many puns we can…
Dr. Naota Hashimoto: Yeah, there was…
Dr. Naota Hashimoto: It was a profitable thing, but it was not congruent with our model and it just…
Dr. Allen Miner: But important.
Dr. Naota Hashimoto: Yeah, I just decided it was like, we’re getting rid of it. So, we got rid of it and everyone was happy.
[laughter]
Dr. Brian Capra: That’s a good one, man.
Dr. Allen Miner: Awesome. Well, we better wrap it up. We’re running out of time now. Anything else to add brother?
Dr. Naota Hashimoto: Just accounts receivable. Just making sure you guys are… People are collecting on that. That’s one thing that we see a lot. A number of people will have inaccurate ledgers and if you have inaccurate ledgers, it makes it really hard for the people in the front line. If you make it really easy for your front desk to collect. One of the things we had is we had a more of a billing manager type person. They just go through and comb through and they put what people owe when they’re coming in. And if you collect that $50 today or that 20 or 30, when it’s small, that makes a big difference. Because once it gets to a bigger number, some of the patients just disappear because they don’t want their bill to accrue that much. And you just got to collect faster. Prepays are great but there’s still a lot of people that have disorganized ledgers that aren’t collecting for the services that they’re delivering. So that would be something I’d highly recommend for everyone.
Dr. Allen Miner: Awesome point. Well, thanks, Naota. Appreciate you coming on, man.
Dr. Brian Capra: Thanks, brother.
Dr. Allen Miner: Thanks for your best practices and we’re going to wrap it up, guys. Thanks for joining us. Have a nice day.
Dr. Brian Capra: Thanks.
