Derms cut back as economy continues to pinch

May 1, 2010

Just as patients are delaying or downsizing elective treatments, the economy is pushing dermatology practices to do more with less, sources say. From manpower to marketing dollars, practices are economizing while also seeking to maintain - if not improve - patient service.

Key Points

EDITOR'S NOTE: Today's economy is forcing many dermatology practices to cut back, or to do more with less. In this issue, we take a look at some of the ways your colleagues are meeting the challenges - including whether some are thinking of delaying retirement (see "Rethinking retirement: Tough times aside, derms say it's rare for older practitioners to leave specialty"). We also examine lessons learned about the value of excellent service, smart marketing and the personal touch (see "Recession's lessons: Quality service, smart marketing, personal touch help keep practices strong").

National report - Just as patients are delaying or downsizing elective treatments, the economy is pushing dermatology practices to do more with less, sources say.

From manpower to marketing dollars, practices are economizing while also seeking to maintain - if not improve - patient service.

Multiple factors are playing into the belt-tightening.

Aesthetic patients are asking more questions than they did three years ago, says Theresa Pacheco, M.D., associate professor of dermatology and director of the cosmetic clinic at the University of Colorado, Denver.

"(Patients) want to know what's the minimal amount of treatments they'll need to achieve their desired results," she says, and they're demanding more accountability from physicians in producing these results.

Low patient volume and bad debts are hurting dermatologists, an expert says.

Elizabeth Woodcock, practice management author and "Business Consult" columnist for Dermatology Times, says practices that weren't already doing so are now collecting co-pays and unmet deductibles before providing services.

"When the patient walks out the door, your chances of collecting plummet to 50 percent," she says.

Hiring is also down, experts say.

Now, he says that due to factors such as declining reimbursements and the influx of non-core specialists providing aesthetic treatments, his dermatologist clients are "trying to figure out ways to not hire someone, whether they have the volume or not. They're more concerned about protecting their bottom line" through strategies such as independent contracts under which the new physician bills under his or her own tax ID number.