How to charge my clients?
Allied Health practitioners often choose their industry due to the desire to help others. They want to ensure services are available for all their clients and often feel bad about charging cancellation fees, not bulk billing, or not offering discounts. Running your own business requires you to make money to pay the bills. So how do you decide how to charge your clients?
First step: Plan your revenue model
There are countless factors to consider when planning your revenue model. Firstly, you should have a solid understanding of your ideal client, and more specifically of your target demographic and location. This will determine the kind of patients you are likely to expect based on geographical circumstances and the client’s socio-economical background.
Secondly, you must have a clear outline of the variety of services you will provide, and the vision of your practice. What does this look like? Does your clinic have a certain feel? Is your service office or community-based? Are you providing a high tier service to working professionals, is your clinic going to be family orientated, or will you be providing low-cost care to those who need it? Combining these, you will be able to get an idea of the billing that fits. Will you provide discounted services for certain client groups, and what is the eligibility criteria? If you are considering bulk-billing, you must strategically consider how you will compete and provide value to your patients and build a profitable practice.
The most important thing to understand regarding the fee structure is that the fees that you charge will be evaluated by your patients against the perceived value that they derive. People are willing to pay for things that they determine to be valuable. Therefore, your services must add value to clients. Perhaps you utilise methods or technologies that are not available in the region. Maybe you have years of experience in certain conditions. Expertise, technology, convenience, and quick turnaround times are examples of things that people will see valuable. Investing behind the value that you deliver to your patients and then charging them appropriately will ensure that you create a sustainable and profitable revenue model for years to come.
When preparing your revenue model, you also need to fully understand the operating costs related to your business and ensure that your budgeting fits with your billing model. What is your bottom line, what is your desired annual income? How many patients will you need to come through the door each week to ensure you are not running at a loss and meeting those financial goals that you have set for yourself and your practice? Will you create passive sources of revenue, will you connect with health funds to increase the volume of patients, or perhaps you will run annual offers and campaigns to support the more quiet times?
Planning your revenue model will be an ongoing process with tweaks and adjustments along the way. The better you understand your target audience, the better decisions you can make regarding your revenue model. The revenue model will become one of your greatest tools when it comes to growing your business. Your revenue model is essential for securing financing in the future, as well as setting realistic goals for marketing and patient acquisition. Finally, a robust revenue model is a useful tool for benchmarking your financial success.
