Photo courtesy of Dr. Laurie Sorrenson. Dr. Sorrenson’s lab technician, Marlin, shakes a piggy bank asking himself where all the money has gone. Dr. Fishbein says that without carefully tracking practice data, it’s easy to wonder where all the money went.
Why data, not drama, should guide your leadership decisions
By Bethany Fishbein, OD
May 14, 2025
It happens every year: the dreaded three-payroll month. Bank accounts dip lower than usual, and even the most experienced practice owners start to panic. “We’re bleeding money,” they say. “What if this keeps happening?”
It’s a valid emotional reaction—but often an exaggerated one. Because when we actually sit down and look at the numbers, a very different story emerges.
Yes, it might be a tighter-than-average month. But more often than not, the data shows that the practice is still on solid footing, and the panic isn’t necessary.
That’s the power of watching your numbers—not just for financial planning or end-of-year reporting, but as an antidote (or at least a balance!) to the emotional roller coaster of running a business.
When you’re making decisions based on feelings alone, it’s easy to over-correct. You might cut spending too quickly, delay an important investment or start questioning the wrong things. But when you ground those decisions in real data, you regain perspective. You move from reactionary to strategic.
So, what are the numbers that matter most?
Here are a few key metrics I review with clients when they’re feeling overwhelmed—especially in months like the one that just ended.
Start with the Money Coming In
When owners feel like they’re hemorrhaging cash, the instinct is to zoom in on expenses—but before you go there, it’s more helpful to start by checking the inflow. Is the business actually bringing in less, or does it just feel that way because of timing?
A few key numbers on the income side can provide quick reassurance—or a clear signal that something really does need attention:
- Collected revenue: The bottom line—how much money actually hit your account this month. Not billed, not scheduled. Collected.
- Number of exams: If exam volume is steady or growing, that’s a strong sign your patient pipeline is healthy.
- Revenue per exam: A dip here might point to fewer sales, less insurance reimbursement or a slowdown in upgraded services—worth digging into.
- Number of frames sold: This helps clarify optical capture rate and whether sales are keeping up with exam volume.
- Capture rate on optional services: Are you converting on things like retinal imaging or dry eye products and accessories?
- Specialty service tracking: Whether it’s myopia management, IPL, vision therapy or something else—watching visit counts, revenue and growth trends in these areas tells you whether your investments in specialty care are paying off.
Then Look at What’s Going Out
If income is holding steady, the next question is: where is the money going? In three-payroll months, the answer is almost always obvious—staffing costs are temporarily inflated. But without looking at the actual numbers, it’s easy to catastrophize.
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Here’s what I suggest focusing on:
- Cost of goods: Are lab bills, contact lenses and frame costs staying in proportion to sales? If your revenue is up, but the cost of goods is climbing faster, it’s time to take a closer look.
- Staffing costs: Payroll spikes when there’s an extra pay period, and that’s normal.
What matters is the proportion of staffing costs to revenue over time—not just this
month. (Pro tip: you can eliminate this issue altogether by switching from biweekly payroll to twice-monthly!) - Year-to-date net income: Don’t judge your profitability by one ugly month. Zoom out and check your net income for the year. If things were on track before this dip, they probably still are. The sky isn’t falling—it’s just a lumpy cash flow month. (Pro tip: Looking at a rolling four-month average will even out the lumpiness – if this still looks good after a bad month, you don’t need to act yet, but if your four-month average is dropping, you definitely have an issue that needs fixing!)
Make Sure the Money You Earned Is Actually on Its Way
Sometimes it’s not that income is low or expenses are high—it’s just that the money is sitting in limbo. Before making any assumptions, check to see whether revenue is delayed in getting to you.
These are the metrics that catch issues early:
- Insurance aging: Are there outstanding claims that haven’t been paid within 30 or 60 days? A spike here can signal billing delays, rejections or follow-up issues that need attention.
- Patient aging: How much money are you waiting on from patients, and how long has it been? If your accounts receivable are creeping up, especially in the 60–90+ day categories, it might be time to revisit your collection processes.
Regularly checking these numbers doesn’t just help you feel more in control—it helps you be more in control. If the money isn’t coming in when expected, your books may look worse than they actually are. But once you fix the flow, the picture often improves quickly.
Build the Habit—Even When Things Feel Fine
Watching your numbers isn’t just a crisis-management tool—it’s a leadership habit. The more regularly you review your financial data, the less reactive you become. You start to anticipate patterns, spot problems early and make decisions based on facts instead of fear.
It’s easy to get thrown off in a tough month, especially when your bank account takes a hit. But when you have real data in front of you—when you can say, “Yes, this month looks rough, but year-to-date we’re still solid”—you’re leading from clarity, not panic.
You don’t have to become a financial analyst. You just have to know what to look at and build the habit of looking regularly. Because ultimately, the numbers tell the real story. And when you trust them, you can lead with a lot more confidence—no matter what the calendar (or the bank account) says.
Read another column by Dr. Fishbein
Read more about the use of practice metrics in ROB sister publication Independent Strong
Bethany Fishbein, OD, is a practice owner, practice management consultant and certified executive coach. She can be reached at bethany@leadersofvision.com
