It’s been a turbulent few years for care settings in the UK. Over a decade of austerity was finally easing and then COVID-19 came along and flipped the world on its head. It had disastrous effects on budget management in care settings.
Businesses cut budgets, people lost jobs, and the nation’s health suffered. As the disruption ravaged budgets, it became incredibly tough for care providers to maintain standards.
How financial challenges strain care setting businesses.
- Staff retention: When budgets are tight, staff feel the strain. People may consider their options and look to work elsewhere if they’re too stressed or fear losing their jobs.
- Budget cuts: Some healthcare services rely heavily on funding from local authorities. When local authorities face an economic squeeze, they often look to balance the budget by cutting key funding initiatives, including support for care homes.
- Meeting industry regulations: Many healthcare and social care services must meet Care Quality (CQC) standards. Tight budgets put more strain on them to maintain high standards.
- Unable to evolve: Business owners know technology can help streamline their processes. But the upfront costs and learning curve make it feel out of reach. Without the budget and time needed to learn new systems, they keep working the same way though they know it’s flawed.
- Patient satisfaction: All of the above starts to affect the customer experience. Longer wait times, limited access to services, and overall service can go down when budgets are tight.
7 Tips to navigate finances in care business
1. Take a proactive approach to budget management.
Care settings have had to get creative with their budgets. Thinking ‘lean’ has soared in popularity recently as care settings try to create more value with fewer resources.
While many factors are out of your control, take ownership of what’s within your control to make better decisions and stretch your budget further.
- Establish Key Performance Indicators (KPIs): Determine your success metrics (average cost per procedure, revenue per patient, etc.). These help you quickly assess financial performance and pinpoint areas to improve.
- Set SMART financial goals: SMART stands for Specific, Measurable, Achievable, Relevant, and Time-bound. A SMART goal example is to increase your overall patient scores from 70% to 75% within six months, with success measured by patient surveys and feedback forms.
- Prioritise spending: Assess your company needs, resources, and goals to determine your priorities. Meet with stakeholders, review data, resource allocation, etc. Get clear on what you should be spending on, and what’s possible with your budget.
- Track expenses in real-time: Plans can come to a screeching halt after you calculate your monthly expenses. There are many ways to track your expenses in real time to avoid them building up in the background. Check out Soldo, Capture Expense, and Abacus to track expenses as you go.
- Contingency planning: The last few years have taught us to expect the unexpected. You should have a contingency plan in place for pandemics, natural disasters, supply chain disruptions, cyberattacks, etc. Act swiftly to safeguard the health of your patients, staff, and company should a disaster occur.
2. Take advantage of modern technology.
Effective budget management in care settings is almost impossible without modern tech. Care settings aren’t typically renowned for being tech-savvy. But many instantly accessible tools are easy to use and can help improve your finances.
Software as a Service (SaaS) tools can help you take your budget further. Most SaaS products offer a free trial period too, so you can get a feel for the software to see if it’s right for you before you commit.
Finance management tools for care setting businesses.
- Accounting software: SMEs use popular SaaS tools such as Xero, QuickBooks, and Crunch to help manage finances. These tools automate common tasks such as bookkeeping, invoicing, and expense tracking. Many of these tools also provide real-time visibility of your financial health (provided you enter data), which is something many businesses have never experienced. Businesses using paperwork and manual processes may not know how profitable they are until everything’s processed, which can take weeks! Working with real-time data is a safer way to work.
- Forecasting software: The tools listed above provide some tools for budgeting and forecasting. But there are also specialist forecasting tools such as Adaptive Insights, Anaplan, and ForecastX.
- Electronic Health Records (EHR) software: Streamline patient billing and insurance claims for greater visibility of your finances, simplify payments, and improve data security.
- Smart expense management: Modern banks and business tools have features to help you track your expenses but they’re often ignored in favour of spreadsheets! But spreadsheets don’t make for a fun task when it’s time to submit expenses. There are much more convenient tools such as Expensify, Airbase, and Concur.
- Compliance management software: Ease the burden of staying up-to-date with the latest regulatory requirements and industry standards. Compliance management systems track regulatory changes, manage documentation, and assist you by automating compliance-related tasks to reduce the risk of errors.
- Document management systems (DMS): Manage and secure large amounts of documentation (patient records, clinical notes, etc.) with DMS systems such as PointClickCare, Sunrise, and CareCloud.
Workflow automation for care settings.
Effective budget management in care settings requires time and attention. But most businesses need more than both. Automation can give you hours back, making life easier for staff while providing a better patient service.
- 24/7 live answering services: a team of friendly, well-trained live receptionists can take calls for you around the clock. Focus on providing world-class care while a team of outsourced receptionists take care of your callers. Appointment scheduling, live chat, and call transfer services are available to streamline your workflow too.
- Integrations: Manual data entry and data conflicts are common chores for care settings. They take up time, they’re not enjoyable, and errors can be costly. Integrations can automate tedious tasks like data transfers for you. Live answering services have integrations that push all caller information straight to the tools you’re already using.
- Prescription refills: Online portals and automated phone systems can save healthcare providers and their patients time.
3. Educate staff on financial literacy.
If you’ve ever seen an episode of Dragons’ Den, you’ll know many entrepreneurs don’t know the basics of business finance. The business magnate Richard Branson said he didn’t know the difference between net and gross profit until he was 50!
Educating staff on the basics of financial literacy could boost engagement while promoting better business decision-making at your company. Workshops, seminars, and online training courses can get staff up to speed. When your team has a good understanding of your company’s performance, you’re better placed to master budget management.
4. Negotiate with suppliers.
Making deals is a big part of budget management in care settings. It’s key to remember that just like you, suppliers are a competitive business trying to delight and retain customers. So, with that in mind, it’s worth trying your hand at negotiating to sweeten the deal.
Tips for negotiating with suppliers:
- Treat them with respect: Negotiating with suppliers might be one of many tasks on your to-do list. But you should always be pleasant when speaking to them. They might not be willing to help you if they feel disrespected.
- Do your research: If you’re unsure of the market, you risk overpaying. Doing your research can boost your chances of getting a better deal. Get a good read on the market, quality, prices, and supplier reputation before you place an order.
- Remember, it’s about value: Price is a hugely important factor but it’s just one factor. After they’ve paid, what’s the difference between ‘option A’, ‘option B’, and ‘option C’ over 12 months? How will each option affect your patients, mission, and customer satisfaction scores?
- Negotiate terms and conditions: Make sure the payment terms, delivery schedules, warranties, etc. work for you.
- Check the fine print: Take time to read the contracts to ensure they don’t contain anything that may cause problems later on.
- Contact multiple suppliers: Speak with different suppliers to better understand the market. Suppliers may offer you a discount if they sense you know what you want and are ready to buy.
- Seek long-term partnerships: Repeat business can lead to better deals. Both parties benefit from this as it will make it easier to do business in the future.
5. Seek alternative revenue sources.
Care settings have opportunities that aren’t available for many other businesses. These are far from ‘quick fixes’ though. There might be a lengthy application and review process. But they’re worth the effort as they could transform your business for good.
Grant opportunities
Government grants, non-profits, and charitable foundations may be available to fund projects and programs that enhance care, community needs, or innovation.
How to find grant opportunities for care settings:
- Research your options: Check GOV.UK and watch for opportunities from charitable foundations and trusts.
- Carefully review the criteria: Ensure you’re eligible to apply and the opportunity aligns with your goals.
- Meet with stakeholders: Bring everyone together to review the opportunity, develop ideas, gather data, and make suggestions to write a grant-winning proposal.
- Write a proposal: A great proposal does the ‘heavy lifting’ for the reviewer. The potential value of the offer should be clear for funders to see. It should captivate their attention and be easy to understand. Above all, you should clearly define objectives and timelines.
- Apply: The criteria for every grant application differ. Make sure you’ve ticked every box to avoid rejection and delays.
- Follow-up: Grant opportunities should state a timeline for when they’ll make a decision. Give them a few weeks to review before you follow up.
Diversification
Diversifying offers patients a better service while providing greater efficiency in care settings.
There are many ways to diversify:
- Specialised clinics: Provide a better service to patients and attract more with a clinic tailored to meet specific needs.
- Community work: Getting your name out into the community can build your reputation and maintain customer loyalty. This isn’t a ‘quick fix’ but regular community work can have a steady, positive impact on your finances.
- Online services: Free online resources such as quizzes, blog posts, and downloadable content provide valuable information to patients. When people see you as an authority on key care topics, they’re more likely to become customers.
Explore fundraising and donations.
Fundraising events can build awareness and attract new customers, donations, sponsorships, and new collaborations. This could bring in new sources of income to ease budget management in care settings.
6. Prepare for emergency scenarios.
COVID-19’s disruption was a shocking reminder of how fast things can change. Businesses that were behind on technology struggled to catch up. Whereas those with a contingency plan minimised downtime and were up and running much faster.
Creating contingency plans
There should be a plan for steps to action. A list of potential risks and threats should be listed and the impact they could have on your business. Natural disasters, supply chain disruption, pandemics, etc. List them all and create protocols. These should be reviewed with stakeholders, documented and ready to action should an emergency occur.
Building reserves
Regardless of the size of your business, you have greater peace of mind when you have a ‘buffer’ behind you. A buffer is a financial cushion saved for emergencies. For example, if there was a flu outbreak, services could become strained overnight. Your buffer could cover staff’s overtime pay to keep up with demand.
7. Monitoring and adjusting strategies.
Regular financial reviews
It’s never a good idea to get too comfortable with your spending. You should assess your finances regularly and remain part of your process to ensure effective budget management in care settings.
A major benefit of using modern tech is that most of it collects data, helping you make data-driven decisions that stretch your budget further.
Want to see how a 24/7 answering service can help you navigate budget management in your business? Learn more.
