Cash Flow Management Assistance
Cash flow is the lifeblood of any small business including medical practices. Regardless of patient or customer flow or volume or total billings the business will survive and thrive based upon how much of that "earned" revenue is ultimately converted to cash and to what extent that amount of cash outweighs cash outflow for expenses or capital purchases.
From pricing to earning to billing to collecting to spending, the cash flow of your business must be planned for, monitored and managed in order to pay bills, make payroll, invest properly based on time horizon and invest into new capital expenditure to grow the business.
Improvement in cash flow must begin with an accurate, comprehensive review of the current state of revenue flow and revenue and spending drivers. This means understanding what drives revenue at the root cause, what drives costs and which are fixed versus variable and evaluating the value-added for each activity within the business whether direct or back office in nature.
Then, gaps between the current and optimal cash flow model can be identified and improvement steps can be put into place. Finally, ongoing measurement and monitoring is key to maintaining good financial health.