Overhead

Given some of the medblogosphere references to overhead has me wondering.  Just how much overhead is there in a doctor’s office?  Most businesses have to pay for office space, utilities, supplies, and insurance.  Those things are a normal cost of doing business (although I will concede that malpractice insurance is significantly more expensive than other types of business insurance).  Payroll is where there’s likely to be a distinction.

How many employees are support-staff instead of revenue-generators?  Our company has a CFO, PR clerk, AP/AR clerk, three receptionists, a safety officer, and an attorney, plus four division managers, as overhead personnel.  The other couple hundred employees are generating revenue.  My podiatrist has a nurse and a receptionist; he hires a separate company to do his billing.  Trying to count up all the people in my PCP’s office, my kids and I came up with:

  • receptionist
  • office manager
  • doctor
  • nurse practitioner
  • phone nurse*
  • shot nurse*
  • medical assistant #1
  • medical assistant #2
  • medical assistant #3
  • billing person

The doctor and nurse practitioner are generating income for the office.  The shot-nurse does, sometimes, on a much smaller scale.  There’s also a lab tech, but I’m guessing she gets paid by the lab, not the doctor (I would never ask since it’s really none of my business).  The others are support staff.   Even though the shot nurse (and I think one of the MA’s) are part-time, that’s a lot of overhead personnel.

It turns out there’s even more support staff than that.  A while back I was going to take a snack to my doctor’s office and wanted to be sure there was enough to go around.  Instead of taking food for eleven people and having it not be enough, just to be sure, I asked for a head count.  Good thing I asked!  The receptionist started naming people I’d never heard of and came up with a huge total.  Twenty-four!!!!

Who are those other people?  What are they doing?  They aren’t seeing patients, that’s for sure.  The receptionist doesn’t examine patients, but at least she sees them!  Running through every task I can think of, at-most I come up with six more positions (file clerk, custodian…).  I was surprised at the overhead when I thought there were eight non-revenue-generating staff.  To learn that there are triple that number of people is incredible.

It’s no wonder so many people in private practice feel like the overhead is overwhelming!

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*We’re pretty sure that their official titles aren’t “shot nurse” and “phone nurse” but that’s what we call them since that seems to be the majority of what they do when we see them (really, it’s <i>Julie the shot nurse</i> and <i>Tammy the phone nurse</i>, to distinguish them from Tammi, the receptionist, and Julia, the MA).