Moving right along with our Business Models series, I’m excited to chat in this episode about the business model that’s near and dear to my heart – Mobile Ultrasound Fee for Service. Its how we started our mobile ultrasound business and I can’t wait to share the details with you.

Transcript:

(00:00):

Grab a seat and a cup of coffee because you just enrolled in Ultrasound Business School. We are obsessed with all things ultrasound and are here to take you on a journey through the messy and the magical side of business ownership. Think marketing, contracts, vendors, admin, growth mindset, and that’s just the tip of the iceberg. This is the Talking Tech podcast, a sonographer’s guide to entrepreneurship. Here’s your host, Jennifer Lindsey.

Jen (00:31):

Welcome to the second episode of our business models series. We’re going to break down the mobile ultrasound fee-for-service business model today in this episode. I have talked about this one a lot, as it’s the most common initial setup when you’re looking to start a mobile ultrasound business. It’s less work, less overhead. It’s near and dear to my heart because not only is this how we initially set up our own mobile ultrasound business here in Indiana, this is what I teach over in our Ultrasound Business Academy Advanced Program. It is just such a great jumping-off point for so many other options for your business. So in this setup, you provide mobile ultrasound services to physician practices, clinics, and hospitals. The physician’s office or the facility is the one billing insurance directly, and you, as the mobile service provider, are charging a service fee for providing the ultrasounds in the office.

(01:37)
So they will bill insurance directly, your physician, or the clinic that you’re working at. They received the revenue back into their practice. You are invoicing them monthly for the time that you are scheduled in their practice. So because of the rules and regulations with Medicare for physician offices, we have to charge an hourly rate for our services. We can’t do what they call a pay-per-click where we’re charging by the patient. Now, if you’re going into other types of facilities like nursing homes or hospitals, that rule doesn’t apply. But for physician offices, we have to have a contracted hourly rate. So this means that whether you’re doing one, more extensive ultrasound in that hour, like let’s just say a bilateral venous stopper as an example, or three quick ultrasounds like gallbladder ultrasounds as another example, we’re charging the same hourly rate. So no matter how many ultrasounds we’re doing inside that hour, we’re charging one hourly rate for the service provision in their office.

(02:42)
Now the industry average here is about $125 an hour. So for reference, when you’re looking at creating your revenue projections for your new business, you can gauge about a thousand dollars in gross revenue back to your company for an eight-hour day of service. So about a thousand dollars in gross revenue back to you for that full day of service. Now you may have some offices where you’re going half a day; for that four-hour period, you’re looking at about $500 and a half day. So on those particular days, you could book up the morning at one physician’s office, grab some lunch and head over to another physician’s office for the afternoon to get that eight-hour full day in. Now on the east coast, west coast, and some bigger cities in between, your reimbursements may be higher than the national average.

(03:33)
So you may be able to charge a higher hourly rate there than the $125. The same goes for those of you who are providing those higher reimbursable scans, like more echo, vascular only. As I mentioned, we suggest scheduling your service days so that you have recurring scheduled time blocks for each physician client. It may differ a little bit if you’re doing something more like nursing homes where some of the things they have may be more emergent, but because you can charge by the patient there, you can charge a little bit higher by the patient to kind of cover all the cost for you to be traveling and all of those types of things. But when you are going out to physician practices, it doesn’t make sense to go to one doctor for this patient or another doctor for two or three patients.

(04:22)
It makes the most sense to have scheduled time blocks for each of your physician clients. And again, it will vary based on your client’s practice size and the patient load. As an example case study in our own mobile business here in Indiana, we have some really small accounts where we’re scheduled every other week for half a day. Obviously, if they have emergent exams in between there, they’re just popping them over to the hospital. But as we know, most of the ultrasounds we’re looking at aren’t emergent unless they’re having critical pain. So they can be scheduling their echos, thyroids, carotid ultrasounds, all of those in that scheduled time that they already know that we’re in the office. It makes it so convenient for their scheduling staff because they know, as an example, Advanced Imaging comes in every Monday from 8 to 12.

(05:15)
The doctor orders the ultrasound; the patient goes to checkout, and they say, oh great, the doctor ordered an ultrasound. Our next available appointment time here right in the office is 9 o’clock next Monday. Are you able to make that? So it’s easier for them instead of having to coordinate with referral destinations and all of that. So having those scheduled times in the practice makes it easy on everyone, the patient, the schedulers, and you as the mobile provider. We then have some other larger accounts where we travel to multiple locations multiple days a week. We’ve got a big neurology practice here in Indiana where we go to five different offices of theirs, and so it just is going to vary. But that’s what I love about this business model is that you can work with one-doctor practices all the way up to multiple, multiple, multiple-doctor practices because all we’re doing is customizing the scheduled time frame that we’re actually in the practice.

(06:13)
Talking a little bit about the pros and cons of this business model. So the definite pros are that you do not have to have a medical director or a supervising physician as defined by Medicare. I suggest having a partner interpreting physician group just to be able to use as a referral to your physicians who can’t read their own studies, to have a super turnkey service, so they don’t have to do anything. You’re coming in and basically creating an ultrasound department in their practice; all they’re doing is scheduling the patients and then billing for the service that you’re providing. The referrals to the interpreting doctors is something we love providing in our vendor list to our Ultrasound Business Academy clients because it’s just a great way to be that one-stop shop for your docs. The more you can do for your physician clients and the more seamless and turnkey it is, the easier it’s going to be to close accounts A; and B, the easier it’s going to be to keep accounts for the long term because your service is just going to be easy and seamless.

(07:14)
The other pro is that because you don’t have to complete any insurance credentialing if you’re providing a fee-for-service, you can wait to purchase your equipment until you’re ready to start that first account. As a mobile ultrasound service provider, that’s our biggest monthly expense. So to be able to wait to purchase that until you’re ready to start, that first account is awesome for cash flow when you’re first starting out. If you listen to my previous podcast, where we talked about mobile ultrasound as an IDTF, you’re actually credentialed with insurance. You’ll remember that you have to buy your equipment before you start seeing any patients because you have to have that serial number listed on your insurance paperwork. So let’s talk about a few of the cons here for this business model. So you’re certainly going to run into some physicians whose insurance providers don’t allow them to bill in the office or those who just don’t want to deal with the billing side.

(08:14)
Even though ultrasound is a very easily reimbursed procedure compared to many others, as long as the coding’s correct, it’s an easily reimbursed procedure; some providers just don’t want to deal with it. Now this is the nature of sales. We have to remember; you are going to, no matter what business in the world you start, you’re going to know some people that say this is great, some people that say, eh, I don’t really want to do it, and others that say, I’d love this type of service; I would love it customized this way or that way or I’d love these types of services. And so, as you go through your sales process, mark that down with each of the physicians. Keep really good notes because I’ll talk about this in a second; it’s a great way to figure out your next steps as you continue to grow your business on additional types of services to add in.

(09:06)
So for our own mobile ultrasound business over the course of years and years, we provided services on just a fee-for-service basis, like I’m talking about in this episode, for, gosh, at least 12 years, maybe a little bit longer. That’s all we did. And so I just kept notes of all those physicians who said, Hey, I love the idea. I don’t want to bill fine; that’s a no; we’re going to move on to the next physician group to chat with them about the service. I would keep a list there. And again, we have to remember it’s the nature of sales, which I think, as a side note, it’s really hard to accept when you’re an ultrasound tech, and sales isn’t something that’s in your wheelhouse. Most of my clients are sonographers who have never been in sales before, and it takes a bit of time to get used to the sales process.

(10:06)
Just like anything new, right? We’ve got to grow some thick skin and realize there are going to be a lot of no’s, and we just have to get through the no’s to get to the yes’s. And that can be a hard thing for us to accept. Once we accept that, we can accept the, hey, I’m not interested, and move easily on to another group. So again, I’m really getting off on a tangent on my side note here. Still, think about a sales funnel where you’re putting all of the physicians local to you at the very top of this funnel and think of it as the funnel getting more narrow, more and more and more and more narrow, until you’re popping out closed clients at the very bottom, these prospects are going to fall out at each point in your sales process as you get further and further down that funnel.

(10:58)
So the more we realize we want that definitive yes or no, we don’t like a lot of wishy-washy stuff because we want to get through any of the no’s to continue to get through the yes’s. So the more people we put in the top of that funnel, the more closed contracts we’ll have at the bottom. And then along the way, we want to be keeping really good notes to say, okay, I have a list now of 20 doctors that said they really would love this service, but they don’t want to deal with the billing. Maybe as I grow and I’m ready to add on new services, maybe that’s the next service I add because I’ve got 20 facilities or doctor’s offices ready to roll once I actually have that done. So again, in my business, I started making a list of doctors who loved the idea of having the service in-house but didn’t want to deal with the billing.

(11:46)
And again, that’s the beauty of having so many options available to us in the ultrasound industry because once we are ready to expand and add on those additional services, billing ourselves for our business was the next business model we added. So I went back to all those physicians on my list and started the sales process there with them, with the new option of us billing insurance directly. And so again, this is something you’ll always run into in any business you start; you’ll have some prospects that jump at the idea, others that aren’t interested, and some that would like a service kind of similar to what you’re providing, and then that’s where you can start that list. Keeping really good notes is something I highly suggest for any of the offices you visit, regardless of their answer to your sales process.

(12:36)
Maybe they want staffing only; maybe they’re looking for other types of imaging, EKGs, those types of things. It’s just a great way to gauge your market so that as you grow your business, you know exactly what the doctors in your market are looking for. You can easily continue to implement additional service options as you grow your business. As you can tell, this is one of my favorite business models to start out with because the overhead is extremely low. You have the opportunity to add in so many other business models as you grow. The main startup cost here is usually the contracts because you have to have a contract crafted by a healthcare attorney. I am going to repeat that because it’s that important. You have to have a contract crafted by a healthcare attorney. There really isn’t an option outside of that.

(13:27)
There are so many rules and regulations that come into play when you bring in the tech and the equipment, and if you don’t have a contract that carves out all of the exceptions for those regulations, your doctors can get into a ton of trouble. They can actually even lose their Medicare number. Like not just being unable to see ultrasound patients and bill Medicare, like not being able to bill Medicare at all. Not good. You don’t want any part of that. Now when it comes to these contracts, they come with a pretty hefty price tag. I’ve seen these service agreements, just the service agreement contract run anywhere from about $7,500 to $10,000. So it is hefty. This is another reason, shameless plug; I get so pumped for our clients in our Ultrasound Business Academy program because the rules and regulations governing this are federal; they have to do with Medicare.

(14:22)
So we can include that contract along with a HIPAA agreement. We have another bonus contract in there. It’s right in our program. So it’s a huge, huge, huge cost saver. You guys, I love this business model so much. It is definitely near and dear to my heart. It is a wonderful way to start and then be able to start with the lowest kind of overhead costs and then be able to add in so many additional business models as you grow. I’m so excited to continue to go through these model options to give you some insight into how we can start, expand, and grow our businesses. So until next time, I will be over here cheering on.

(15:05):

Ready to see what it takes to start your own mobile ultrasound business? Grab our completely free startup guide and learn how you can make a thousand dollars a day with your own business. Head to our website, www.aic-ultrasound.com, to check it out.