With Medicare, Medicaid and insurance companies curtailing reimbursements, doctors are looking for ways to add ancillary services to help replace some of this lost revenue. Many are adding services such as audiology services, nutritional counseling, Holter monitoring, and hair removal.

While these all sound like great ideas, a quick analysis should be done before incorporating them into the practice. Some of the factors to consider are:

• Is there a need for this service in our geographic area or in our patient base?
• Do we need to purchase new equipment?
• If so, what is the cost of the equipment?
• Should we buy or lease the equipment?
• How often will the equipment need to be replaced?
• What is the cost for any service contracts needed?
• Will there be special training needed for the doctors or the office staff?
• Will we have to hire new staff for the job?
• Who in the office has the time to devote to the new services?
• Do we need to add additional office hours for these services?
• Will we need to establish new office policies and will protocols need to be developed into the practice?

The answers to these questions can all come with costs. Therefore, before you consider adding ancillary services into your practice just for the sake of adding revenue, make sure that some of the revenue you generate makes it to net revenue. In other words, make sure that the anticipated revenue will outweigh the costs incurred. Contact your Rea advisor for help.

-By Alan C. Hill, CPA, CSA (Mentor office)

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