StudentDC Interactive

You’re headed off to the bank with fantastic business plan in hand, but you have no cash, no co-signer, no collateral.  Don’t be surprised if the bank turns you down. Banks want to loan money via “secured” loans - loans that have something of value behind them that the bank can take if you don’t pay.  That “something of value” has to be something that the bank can quickly turn into cash without much loss.  Obviously, cash is best.  Next would be something like a building that you or your co-signer owns that the bank can expect to get money out of.  In these times of decreasing home values, don’t be surprised if the bank says the equity in the home has to be much greater than the loan value.  The equipment that you bought has value, but it depreciates (loses value over time), so the bank will take a loss if you have to sell it.  That’s why they often ignore all that great stuff you just bought.

Why is the bank so picky about this?  Businesses go bankrupt, including chiropractic businesses.  And banks want to be “first in line” to get their money back.  So they want a solid assurance that they can get that money back, easily and quickly.  In these tough financial times, banks are even more skittish than usual, because business bankruptcies and mortgage foreclosures are more common.  The bank will fail (like Washington Mutual) if they continue to make high-risk loans.

Just one more point:  If you want a line of credit for working capital, in the past a bank might give you this money unsecured, but these days they want security, for the reason I discussed above.  It’s often said that “banks loan money to people who don’t need it.”  This is what they mean.  Be prepared to pledge assets, or find a co-signer who will do so.

A New Zealand chiropractor lost just about everything in a fire in his office.  He has found a temporary office and he’s in the process of re-building. 

What if this happened to your new practice?  You must have property/casualty/liability insurance set up when you start your practice.  And it must include “business interruption” insurance to provide you with funds while your practice is shut down.  I guarantee you that your bank will require you to have insurance on any building you buy or on the contents of your office if you are renting.  Get the most you can.  You never know….

In my last post, I talked about the importance of  making sure you have all the insurance coverage you need.  One type of insurance that I didn’t mention is disability coverage.

When I talk with new DC’s about insurance, I usually put disability coverage on the list.  I usually get a blank stare and I can see that they don’t really register its importance.  But even if you are “well adjusted” you could be in an accident or have a disabling illness.  I know disability insurance is an additional expense you think you can live  without, but don’t wait until you need it - it will be too late.

Three companies specifically provide disability insurance for chiropractors.  Investigate the features and costs for each and get disability insurance as soon as possible.

ChiroSecure

Chiropractic Benefit Services

NCMIC

Also, be sure to read this informative article from a recent issue of Chiropractic Economics about disability insurance.

Sure, you know you need malpractice, but what else?  Many businesses neglect getting these insurances until it’s too late:

• Business interruption insurance, to help pay your bills and provide temporary facilities if your business is destroyed because of a disaster, like fire
• Key person life insurance to protect your family and your business if something happens to you (some banks require this anyway)
• Employment practices insurance to cover you if an employee sues you for harassment or wrongful dismissal
• If you have an office in your home, you will need separate property/casualty/liability insurance on your business equipment and the section of your home devoted to business (in other words, it’s not covered by your homeowner’s policy)

The National Association of Insurance Commissioners (the national organization of insurers that works with state insurance commissioners) has an informative website called InsureU for Business (http://www.insureuonline.org/smallbusiness/ )  that gives you information on different types of business insurance.  Before you start your practice, spend some time in this site learning about types of insurance, what it is used for, and the varieties of coverage.

I hear lots of students say they want a “wellness” practice.  I’m never sure what that means.  Does it mean you want to treat people who are well?  You certainly can do that, but you won’t get any insurance or Medicare money for this, so these people must be “cash” patients.

Does it mean you want to promote wellness among patients and staff?  If so, I applaud you.  If you want to encourage “wellness thinking” among staff, how will you do that?  There are lots of opportunities in your practice to help people think “wellness” instead of “sickness” or “dis-ease.”  Remember, we move toward what we think about .

For example, change your time off policy to have “wellness days” instead of “sick days.”  In a prior job, I heard it called “taking a mental health day.”  The principle is that you don’t need to be sick to take a day off; sometimes you just need to stay at home, or go do some errands that have been piling up, or spend time with your family.  And sometimes people really are sick and need to be at home to “get well.”  A benefit of instituting Wellness Days is that employees can just call in and say they’re taking a wellness day; they don’t need to lie and say they’re sick.  And you don’t need to differentiate between sick days or personal days; they’re all wellness days.

Of course, you must limit the number of Wellness Days you provide; you should have no more than you would have provided for staff sick days and personal days combined.  It makes the time off calculations easier.  More important, it sends a message to your staff that you care about their wellness.

To continue this discussion, what other kinds of things could you do in your office to encourage wellness among staff?  How about encouraging patient wellness?  What would a Wellness Day for patients look like?