The Wellness Center
by Dr. Charles W. King
A rapidly expanding group of healthcare professionals, chiropractors, dentists, nutritionists, paramedics, pharmacists, physical therapists, primary care physicians, psychiatrists, surgeons, trainers, etc. are integrating the concept of the “wellness center” into their health care policies.
The “wellness center” educates the patient on preventive medicine and alternative options for lifestyle management and longevity. Focus is placed on proactive low-fat diets, active exercise and vitamin/nutritional supplementation. Because of the provider’s credibility and relationship with the patient, the provider can educate the patient and encourage behavioral change toward healthfulness.
An old wive’s tale once
questioned providers selling products to patients. In today’s economic environment, health care providers advertise and
sell products. Eye, ear and nose doctors sell hearing aids, orthopedic doctors sell orthopedic devices, ophthalmologists and cosmetic doctors sell skin creams; OB/GYN doctors sell diaphragms and ovulation predictor kits.
Most wellness centers use a specific high-tech line of personal care and vitamin supplementation products for the patients. Several leading companies have developed outstanding product lines that are being featured by health care providers. The supplying members assist the providers in structuring their wellness centers.
Providers structure a number of different operating formats for managing their wellness centers. After selecting the supplier and becoming an independent contract member, the provider staff defines the policies and procedures the office staff will use in dealing with the patients. The staff also receives product information and training from the supplying member.
During the routine patient visit, the provider would discuss the role of vitamin and nutritional supplementation and broadly outline alternative product systems. The patient would ultimately be referred to the office/nurse/assistant/ receptionist for handling the patient’s ordering process. The office works with the interested patient in selection of a product system. A limited product display of key products may be featured in the office to provide patient information / “touch and feel.”
Improve patient care through programmed preventive medicine
The “wellness center” in the practice office during a routine office visit introduced the patient to the need for ongoing preventive medical care and presents alternative therapies and product systems from which the patient can choose. The wellness center also serves as a supplemental revenue stream/“strategic business unit” for the practice office.
In the sales process, some offices maintain a small inventory of key products to make them immediately available to the patient. Alternatively, the office assistant may help the patient place a telephone order directly to the company.
Some offices charge patients the wholesale price and base their profit on the commission received directly from the company. Others charge full retail price and earn both the retail profit and the company commission.
Most offices require the patient to pay for the product purchases via cash, check or credit card to keep the transaction as an independent strategic business unit, separate from medical treatment fees.
If the patient becomes a repeat buyer, most offices sign the person as a member with the supplier company. As independent members, they can buy the product directly from the company at wholesale, and arrange for automatically delivery directly from the company.
One wellness center I analyzed in depth produced the following financial return. The practice enrolled and maintained 75 patient families into a vitamin/supplementation program. The families averaged $150 per month in purchases ($100 business value). The wellness center’s commission from the supplier company was 45% on the business value.
75 families
x $100 business value
= $7,500 monthly business value
$7,500 monthly business value
x 55% commission
= $4,125 monthly commission
= $49,500 annual commission
With this patient usage level the wellness center earned an average of $4,125 per month, or $49,500 per year, before retail profit, with modest incremental expense to the practice. All of the families were on automatic delivery directly from the supplier company. You can manipulate the profit equation and develop your own pro forma for your practice.
Dr. James F. Winterstein, President of National College of Chiropractic, has written the chiropractic profession is in a dramatic state of change. Conventional scientific medicine is under attack. Alternative medicine, with its broad modalities, is being recognized as a realistic approach to wellness and longevity. Winterstein warns the profession must avoid, “inertia of…position,” failure to adapt and capture opportunities for repositioning chiropractic.
The individual chiropractic practice is facing the same threat of “inertia of position!” The wellness center built on a cornerstone of a vitamin/nutritional supplementation program can provide an important patient wellness contribution. The center, as detailed in the economic analysis, can give the individual practice significant profitable revenue.
Dr. Charles W. King is a Harvard Doctor of Business Administration, and an internationally known and recognized speaker in the marketing field. Dr. King currently teaches marketing at the University of Illinois and conducts ongoing marketing research.