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Medical Ancillary Services Can Boost Practice Profitability

August 17, 2017

Medical Ancillary Services

Due to uncertainty in healthcare reimbursements, higher costs  and greater regulation, primary care physician practices are always seeking ways to increase revenue. Adding patients to a practice can be a successful tactic, but diversifying often leads to greater success. 

Adding medical ancillary services, such as laboratory, or allergy shots or aesthetic services, nutritional supplements or another type of retail service, works for a variety of reasons.

First, primary care physicians can attract new patients who may not have sought treatment otherwise. Second, having ancillary services available allow physicians to cross sell to existing patients. 

However, this strategy requires research and planning to be successful. Instead of simply guessing what services to add, physicians should carefully consider their options. 

Assess Patients’ Needs and Wants

Use your own patient population as a control group. Assess their needs to determine which ancillary services might be attractive. Would patients be find it convenient to have on-site lab or x-ray capabilities? Is Botox® or fractional laser treatment something you patients would be interested in getting at your practice? How about nutritional supplements? Would your existing patient base respond favorably to this product offering? What’s the general age and and insurance makeup of your patient population? Does it trend toward seniors or younger adults?

An easy way to identify potential ancillary services is by looking at which services you frequently send to other providers. Look at those procedures, determine if they can be provided in house and consider the feasibility and potential return on investment if you broadened your scope of services

Related Link:  Improve Practice Profitability by Reducing Costs of Medical Supplies

Once you determine which type of ancillary service is right for your patient group, consider how much adding the service will cost. Is a capital investment required? Will you need to hire more staff? In some cases, physician practices can contract with a provider to come in on a regular basis to provide a service. Physicians pay the provider a set fee and then charge patients for the test and any association medications.

Keys for Success

Keep patients’ needs at the forefront 

As a doctor, you have to consider the market’s demands instead of your preferences. That’s because patients want easy, one-stop-shopping. They don’t want to drive to several different locations in town to get the products and services they need. Consider this when you’re setting your hours of operation and ease of access.

Consider insurance implications

Before buying equipment or inventory, contact the insurance carriers you contract with to ensure they’ll cover the new service. Otherwise, you risk loosing money if your investment sits idle because patients don’t want to pay out of pocket for your ancillary service.

Don’t be a copy others

Just because an ancillary service works at one practice doesn’t mean it will work at yours. Before you broaden your services, do your homework. Talk with other practices who are providing similar services to learn about their experiences. Check for compliance issues to ensure you don’t run into an unexpected problem down the road.

Be comfortable with it 

Don’t add an ancillary service is you’re not comfortable providing it yourself. Many times, primary care physicians adopt a hands-off approach by allowing a technician or nurse to provide the service. It’s not worth the risk to add a service if you’re not willing to actually provide it yourself. 

While medicine exists to heal people, it is a business. Along with adding ancillary services to generate more revenue, physician practices need to look at all options when it comes to billing and revenue cycle management.  We have the experience and expertise needed to impact your bottom line. Contact us at 770-666-0470 or email me at for a free analysis of your practice’s needs. 


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