How Retention and Payroll Impact the Financial Health of Your ABA Practice 

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The industry has changed drastically for ABA practice financials since the beginning of 2020. Providers are scrambling to recover from the pandemic as community healthcare and school-based settings were among those impacted most. Not only did a magnifying glass on public health and a decrease in in-person interactions change how ABA providers deliver care, but the conditions to which the field had to adjust drastically impacted their bottom line. 

 Providers across the country are wondering what their next steps should be in response to fluctuating cash flow. The Behavioral Health Center of Excellence (BHCOE) suggests that an estimated 76% of providers are currently experiencing at least a 50% drop in their revenue compared to what they were bringing in before the start of the pandemic.  

 While COVID-19 is still impacting the field, there are steps providers can take to encourage the growth of their ABA practice financial health. 

Improving the Financial Health of Your ABA Practice 

Focus on Retention 

There are two areas of retention that impact your ABA practice’s financials: Client Retention and Employee Retention. 

 Client Retention  

Most ABA providers should be familiar with the term “client retention” or “client retention rate.” This refers to the rate at which a provider is able to keep their clients. It is calculated by averaging how long a client is expected to work with you versus when/if they self-terminate (or leave your practice). There are a number of reasons why a client might decide to leave a provider. While those are important, the financial issue is that low client retention can be detrimental to your bottom line.  Improving this is an efficient and effective method for addressing ABA practice financial health.  The benefits of client retention include: 

  •  Loyalty   

Loyalty is an incredible thing for a provider’s bottom line. Loyal clients are more likely to keep coming back to your ABA practice and refer others to you for help as well. Increasing client retention means that you have established the level of loyalty that keeps patients coming back for more instead of leaving to go somewhere else.  

  •  Reduced Marketing Costs 

 Providers that are struggling to keep their client retention rates up know just how expensive it can be. If patients are leaving, that means your ABA practice has to work harder to bring new patients in. This causes marketing costs to skyrocket as your try to drum up new business. Increasing your client retention rate reduces the need to market heavily, cutting those costs and improving ABA practice financial health.  

  •  Forecast Accuracy  

 With loyal patients who you know are not going anywhere, you can look more accurately into the future. Forecasting is essential to running any practice. With higher client retention rates, providers can better predict future expenses and revenue growth. Without this window into what is to come, providers are not able to plan which leads to wasted resources and a hit to ABA practice financials.  


Increase Communications 

Communication is everything when building rapport with patients and increasing the loyalty they feel toward your practice. Effective communication builds client engagement and satisfaction, which ultimately keeps them coming back for more. The better communication and engagement that exist between your ABA practice and your clients, the higher the retention rate providers will achieve.  

Clearly Set Billing Expectations 

Another prevalent reason that clients leave a provider is that they were caught off guard by the cost of their care. This happens when they do not have a firm understanding of your billing process. Before sessions start, providers need to outline billing expectations in a way that the client clearly understands. This should include payment policies, the cost of services, what types of payment you take, and any other billing information. Keeping them 100% informed will prevent them from ever being caught off guard by their role in the billing process and increase client retention.  

Improve Scheduling 

ABA therapy is an extremely involved area of behavioral health that requires a massive time commitment. When patients do not understand or know what to expect regarding scheduling, it can feel like cause for premature termination. Just like billing, scheduling expectations should be set from the start. Providers and their clients need to sit down and determine what schedule will work for them and utilize digital tools that make scheduling a breeze.  

Employee Retention  

Employee retention is the second type of retention that impacts ABA practice financial health. This refers to the rate at which employees leave their role at your practice. Onboarding new ABA practice employees are expensive and challenging. Increasing employee retention can also have a positive impact on your bottom line.  

 Impact of Employee Retention 

Lower Onboarding Costs 

The average cost to onboard a new employee across all industries is roughly $4000. In the field of ABA therapy, this cost is higher due to the fact that professionals need more in-depth training compared to other industries, like retail. It can take years for new therapists to reach their fullest potential and productivity. By keeping your employee retention rate high, you can avoid costly onboarding processes while seeing the return on your investment for those you trained, who stay on board.   

Shortage of ABA Professionals 

Another reason employee retention matters is because that there is a shortage of ABA professionals in the United States. A recent study compared the per capita supply of certified ABA providers for each state and found that 49 states fell below the benchmark set by the Behavior Analyst Certification Board.  

 Maintaining high employee retention rates prevents providers from having to go on the search for new professionals during a time where there are not many to spare.  


Use Quality Digital Tools 

The tools your practice uses on a daily basis for things like scheduling, planning, payroll, and more all have an impact on the employee experience. To reduce burnout across your organization, ABA practices need to make sure they are using digital tools that simplify some of the processes that have overwhelmed providers in the past. 

Take Steps to Decrease Burnout  

“Burnout” refers to the mental or physical exhaustion that an employee feels and is a direct result of the efforts they exert in the professional setting. Digital tools can be a great way to simplify certain processes, but there are other ways to reduce burnout as well. ABA practices need to make sure they are giving their employees time for self-care and work-life balance as well as space to express concerns and make positive changes.  

Perfect Your Payroll Process 

It may be shocking to hear, but 49% of employees say they will begin their search for another job after just two payroll errors. Making sure your employees get the compensation they deserve for their hard work is an important part of making them feel accomplished in their job and is a motivation for them to stay at your ABA practice.  

Get Serious About Your ABA Practice’s Payroll  

Expanding on the importance of payroll, providers need to get serious about how they are managing it. Payroll is a necessary, yet burdensome process that can cause huge ABA financial headaches. 

Common Issues with Payroll 

Time Consuming 

 81% of small and mid-market practices handle payroll in-house. They do this without the internal support structure that is needed to deliver perfect results every single time. This makes payroll a time and resource-consuming process that ends up stretching ABA practice finances too thin and increasing errors across the board. 

Employee Retention 

 As mentioned earlier, payroll errors can cost an ABA practice its employees. Making sure that your practice is at the top of its game when it comes to payroll is integral for increasing employee retention.  


Integrated Payroll Software  

The best solution for ABA practices that need to improve their payroll and financial health is to adopt a fully integrated payroll solution. A tool like this helps providers avoid costly errors that waste their time and burden their employees. The right solution automatically tracks time worked, overtime, pay periods, pay ranges, and more for every practitioner within the organization.  

Scheduling Component  

Another source of payroll headaches includes the scheduling process. To prevent errors in payroll, like too much overtime or incorrect timestamps, providers need to consider an integrated scheduling component. This helps payroll solutions accurately track and prevent costly mistakes within their calendar process.  

The impact that retention and payroll have on the ABA practice financial health is immeasurable. Providers that pay close attention to these areas of their practice will start to find that they are growing past the financial challenges and trials they faced during the pandemic. The key to strong ABA practice financial health includes updated digital tools as well as the utilization of revenue cycle management services. 



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