Most physician practices will need help on occasion with tasks or questions that require expertise you don’t have in-house. Three types of advisers that can add tremendous, even essential, value to your practice business are CPAs, management consultants and attorneys. But before picking up the phone to engage one of these experts, it’s important to think through which type of assistance you need.
Virtually any business can benefit from the ongoing help of a certified public accountant (CPA), especially for tax filings and related questions. Tax rules are quite complicated and change frequently, so when it comes to business taxes, doing them yourself can quickly become costlier than hiring an expert.
CPAs also create financial statements: balance sheets, income statements and statements of cash flows. Financial statements can be invaluable for understanding your business performance and progress over time. These reports are also essential if you’re looking for financing or considering selling your practice — lenders and prospective buyers will require them. If you’re just starting out, teaming up with a CPA who can advise you on setting up your accounting can help avoid costly mistakes and revisions down the road.
CPAs offer invaluable tax and financial reporting services you can’t easily get from any other source. But it’s important to have realistic expectations. For example, CPAs’ adeptness with financial information doesn’t imply they can look at it and diagnose at a glance why your profitability is declining. Nor can they prevent, or easily spot, embezzling — a common misconception. When buying or selling a practice, it’s also critical to understand the limits of your CPA’s advice. CPAs often get involved in buying and selling small businesses, but the standards for valuing practices are often quite different from other categories; relying only on a CPA for valuation help in a buy-sell situation can lead to mispricing, potentially causing you to overpay for a practice you’re buying or set the price of the one you’re selling suboptimally.
Consultants of various stripes provide many services to practices. IT consultants, for example, can help you set up and maintain your technology infrastructure; marketing or reputation management consultants can help you promote your practice and manage your business image. But if you’re looking for help with profitability problems, streamlining workflow, solving personnel issues, strategic planning or other business advice that requires a more holistic viewpoint, consider engaging a practice management consultant.
Practice management consultants look at your business from the perspective of a general manager. Usually, they have deep experience running practices and other types of businesses. They often have academic training in business analysis, too. They combine their knowledge with a fresh perspective and a data-driven approach to get at the root of business problems (and spot opportunities, too).