Fix Your P&L: The First Step to Making Smarter Business Decisions in 2026
Most psychiatry practice owners never learned how to read a Profit and Loss Statement (P&L). They depend on their accountant to say how things are going but if you can’t read your own numbers, you can't make smart business decisions. You don’t really know where money is made or lost, and that makes every decision harder.
A clean P&L is the foundation for every smart move you’ll make in 2026. Whether you’re hiring, investing in marketing, or expanding services, your numbers should guide the plan, not "feelings".
Why Most P&Ls Are a Mess
Your P&L should clearly show what’s working and what’s not. Yet most are confusing, cluttered, or just wrong.
Expenses categorized incorrectly
Owner draws mixed with payroll
Insurance write-offs missing
Subscriptions buried in “miscellaneous”
Patient refunds never recorded
When your numbers are wrong, your decisions are too. You might think you’re profitable when you’re not—or hold back growth when you could afford to move forward.
The Goal: A P&L That Tells the Truth
A good P&L makes your business simple to understand. Every dollar has a name and a purpose. You’ll see how much revenue each provider generates, what your biggest costs are, and where profits are slipping away.
A clean P&L includes:
Revenue by payor or service
Payroll separated by department (clinical, admin, leadership)
Software and marketing costs listed by vendor
Owner salary separated from business profit
How to Fix It
Step 1: Rebuild your chart of accounts
Expand the categories so you can see exactly where money goes. Skip catch-all labels like “office expenses or marketing expenses”. Get specific!
Step 2: Review the last 3 months
Highlight anything unclear and track it back to the source. Every expense should have a simple answer.
Step 3: Reconcile weekly
Don’t wait for tax season. Meet with your bookkeeper every week to review real numbers and make real decisions.
Step 4: Look for patterns
Are payroll costs growing faster than revenue? Which service line makes the most profit? Your P&L holds the answers.
Why It Matters
Once your P&L is clean, you’ll stop guessing and start leading. You’ll know exactly what you can afford, what needs to change, and where to invest next.
Fixing your P&L might not be glamorous, but it’s the smartest move you’ll make to grow a profitable, scalable practice in 2026.
Take the Next Step: Let’s Talk
If you’re ready to turn your practice into a high-performing business, let’s talk.
Our Business Coaching program helps psychiatry practice owners streamline operations, boost profits, and build confident, accountable teams.
Schedule a free 30-minute strategy call to see how MindPractice can help your practice grow.
