RSM Australia

Strong Alliances the key for allied health today

On face value, you may assume that the health industry is one of the few to financially benefit from the current global pandemic.

Whilst this is true in some cases, the realities are a significant portion of income comes from planned procedures in this industry.


This does not describe the reactionary survival driven treatment that is needed in greater proportions from some health service providers during a crisis such as this.

It is ironic to think that business performance of a health-related service can reduce during a global pandemic.allied health

In the case of allied health, we are usually talking about a planned non-emergency treatment service which remains the focus during COVID-19.

This is one of the main strengths of allied health compared to some non-allied health services, though it’s not all smooth sailing.

Allied health consists of an extensive range of service providers which include:

  • Physiotherapists
  • Chiropractors
  • Occupational therapists
  • Dieticians
  • Osteopaths
  • Optometrists
  • Audiologists
  • Speech therapists
  • Podiatrists; to name a few.

These services can be required by the patient for a short period of time to clear a minor ailment through to ongoing treatment that significantly improves quality of life and can lead to longer life spans.

A common trait of allied health services is the need for physical contact between the practitioner and their patient. This creates an issue within the allied health industry with the need for patient contact, the use of shared treatment equipment and close-proximity consultation.

In some cases of minor, short-term or optional treatments, even where COVID-19 restrictions have been relaxed such as in Western Australia, patients have been inclined to delay their treatment with the service provider to a time deemed safer.

This has a direct impact on top-line income of the practice which we have seen first-hand evidence of, especially in our regional practices.asset_46.png

Where service delay has not been opted into by patients due to higher necessity of treatment or some other reason, this has plugged the cashflow gap for the practices.

The downside, however, is even where the top-line has not been impacted as much as expected, additional costs are being incurred by the businesses in order to keep the practitioners, staff and patients safe from infection and operating to COVID-19 safety requirements.


Think of the extra expense on gloves, long-sleeved gowns, masks, safety glasses, sanitiser, equipment sterilisation, thermometers etc and it does not end there.

There is pressure on the scheduling of patient appointments due to physical spacing requirements in clinical environments and regular cleaning of equipment.

Where telehealth service is possible, there are costs of establishing appropriate platforms and systems to provide this. These are just some of the adjustments needed.

The upside of all of this is that, despite lumps and bumps in the journey and despite pressure on practices’ incomes, due to the strong funding of allied health care (coming from multiple sources like Medicare, NDIS, Department of Veteran Affairs, My Aged Care and private health) and due to Western Australia’s low number of COVID-19 cases, there seems to be continued demand for allied health services in Western Australia.

Given the many sources of income, the main key for allied health practices regionally is to ensure they understand their cashflow requirements to cover their rising costs of being COVID-19 safe.

Budgeting and forecasting are vital functions of all good businesses and allied health practices are no exception.allied health

Those who were active in this space pre-COVID-19 have been able to react quicker, knowing what their cost-drivers are and how to react appropriately when income certainty has reduced or costs have spiked.


Staff expenses are often a major cost in allied health practices.

Where there could be a need for redundancies to adapt to the lower demand on services, it is important to know what the potential liability is going to be in the event of having to pay out their entitlements.

This comes down to good forecasting and management reporting.

Being aware of the various federal and state government COVID-19 stimulus packages, such as applying for JobKeeper, where eligible, in order to prevent some of the above-mentioned redundancies, is also important to assist with cashflow.


How can RSM help?

RSM staff have the knowledge and understand regional business. How? Because we are a regional business too. While COVID-19’s full impact on allied health will not be known for some time, we are sure that its effect on processes and behaviour will be felt for the long-term.

Having local allies like RSM advisers gives allied health providers access to a plethora of industry knowledge and ideas to help them be nimble and agile in a climate that has thrown businesses one very major curveball.

Working with practitioners for structural, business planning and strategic guidance could not only help them get through these times, but also assist them in learning from the experience and being far better prepared for the future.


At RSM Australia, we understand regional business, because we are a regional business.

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