As many economists debate the approach of an economic recession, behavioral health organizations may be unsure how to respond to the possibility. Although demand for health services persist and even increase during an economic recession, that doesn’t mean you should just wait it out.
Here are some things to keep in mind for your behavioral health organization as economic struggles loom.
Demand for your services may increase.
Research suggests that economic recessions and depressions can worsen mental health. Economic and personal difficulties may lead to issues like depression, anxiety, and substance misuse. This could lead to an increased demand for mental health services.
If you are struggling to keep up with demand, you may actually consider hiring additional help (even temporarily) or partnering with related organizations to ease the burden. You may need to upgrade to more efficient business technology solutions.
Create a waiting list and suggest alternative options to those who still need help. For example, suggest other, less costly mental health options, such as support groups and free fitness classes.
Your clients may struggle to pay.
Despite an increased demand for behavioral health services, many clients may postpone vital services or look for alternatives if they lack the ability to pay for them. Consider offering flexible payment options, or help clients find financial assistance programs that may be available to them.
If clients decline behavioral health services because they struggle to pay for them, this could lead to serious mental health incidents that would otherwise be preventable. Such crises can further drive up costs and put pressure on limited resources. Maintain follow-up with clients and check on no-shows to encourage them to stay with their behavioral health care as best they can.
Other funding sources may dry up.
Depending on your organization and the type of services you provide, your budget may rely heavily on charitable giving, government grants, and other types of funding. As budgets tighten, you may see some funding sources become less reliable. Clients who lose their jobs may move from private to public health coverage, which may lead to lower reimbursement for providers.
To prepare for reduced reimbursement and lower income, pay off any debt you have as soon as possible, and don’t take on any more. Avoid making major investments for a while, and review your expenses and eliminate unnecessary costs.
At the same time, do what you can to maintain access to a line of credit you may need to rely on when things get tough. If you can, shorten your billing cycle to try to get paid sooner.
Balance your budget wisely.
During a recession, cutting costs is largely inevitable. However, it is crucial to carefully weigh the pros and cons and make financial decisions without rushing.
For example, you may start thinking about moving your practice to a less expensive location. Before you do, make sure the costs of finding new real estate, moving offices, updating information, and informing (and possibly losing) clients do not outweigh the benefits.
You may consider reducing your marketing budget. However, this may backfire by hurting your referral network or reducing your new client inquiries. You want to keep up some marketing to maintain income.
During an economic downturn, it’s critical to maintain efficiency and compliance. The right tools will help you keep your behavioral health business effective and profitable during challenging times. BestNotes EHR and CRM solutions help you save time and money by improving your business operations and improving the client experience. Request a demo today to learn how!