So we’re getting to the end of another year, and we’re naturally starting to look towards the next year. This means a time for reflection and, in particular, reflecting on money.
Have you done better financially in 2019 than you did in 2018?
Part of being in Private Practice means giving up some of the discomfort we feel about charging patients money. Whatever the outcome of Brexit, we must accept that in order to not fall behind in terms of our real earnings, we have to raise our prices every so often (at least).
January seems as good as time as any to do this, because it’s a natural new beginning. If we leave it until another time, it can seem a little bit more awkward.
Now, you might be thinking…
“Well, I can’t really raise my prices for insured patients because that’s fixed. I’m not sure that I really need to raise the prices for my self-funding patients.”
So how do you know if you should even raise your prices at all?
This is how you tell…
Your diary is getting pretty booked, and you’re at the point of feeling really rather busy, and you have a lot of patients chomping at the bit to see you. Or, you’re in the enviable position of having a waiting list of patients. If that’s you, you should definitely consider raising your prices.
You’re looking at your competitors, and you realise that you offer a far better value service in terms of your skill set and you’re still undercharging relative to them. Then… you should definitely consider raising your prices.
I should caveat this by saying that you should almost never consider reducing your prices based on your competitors.
Remember, you need to grow your practice and not just your patient numbers.
If you’re not getting enough of your very ‘favourite’ patients through the door, now might be a good time to raise your prices. For some reason, patients, who tend to turn out to be a pain in the bum, are often patients who nit-pick over prices and try to get something for nothing. If you’re attracting the wrong kind of patients, it may be… because you’re not charging enough.
And by the way, if you’re going to do pro bono work, that’s something that comes on your terms, not someone else’s
Your overheads are going up, you need to make more money. Full stop.
Isn’t it funny how often we are happy to accept a price increase for example from people who put up our rent for a room or our electricity suppliers, but it’s weird how we’re often reluctant to increase our own prices?
The reality is, this means we end up losing out financially and we are funding other people’s price increases.
If you’re paying for room lodgings, medical administration time or you’re commuting on the underground, you could expect some annual price increases.
So this cost needs to be reflected in your fees.
If you’ve developed an amazing new service or skill set, which means you can bring even greater value to your patients.
You should consider increasing your prices.
How do you do this without scaring away patients?
While it is possible that you may lose out on the patronage of some of your previous nit-pickers, other patients, who appreciate your amazing skills will absolutely want to stay around.
So, get over yourself and give yourself permission to raise those fees.
What is the Goldilocks amount?
Sometimes it’s an idea to think about rounding up your prices. So, if you’re currently charging 82 pounds for a 45-minute appointment, you might want to increase that to 90 pounds.
It’s also a very good time to look at the spread of your fees between your initial and follow up appointments. Bizarrely we tend to undercharge for initial appointments.
When I look at the cost per minute for initial versus a follow-up appointment, I regularly see physios charging 80 pounds for an hour for an initial appointment, (which by the way I think is a too low price for London) and then 50 to 60 pounds for a half hour follow-up appointment. This means they’re missing out when they’re seeing new patients.
Isn’t it time to raise that initial fee so that you and your patient both get value from your skills?
Here are some top tips for ensuring a smooth transition with fee increases…
Be open and honest about your price increase. Tell people that it’s coming. We all expect prices to go up- it’s basic economics, but what we don’t like are nasty surprises. Explain that it will be happening and don’t just present the patient with an increased bill.
Give them plenty of notice. I think a month to six week feels about right.
Maybe you can send out an email explaining how your prices are going to be going up in the new year and put up a little notice at the reception desk if you have one.
A positive spin on this is that often you’ll get a little rush of patients who want to get in on the old price, and it’s a nice way to fill your clinics towards the end of the year.
Show where you can give even extra value by showing you care.
For example, you might want to schedule in some follow up quick phone calls that show patients you love them and also send them information that could be useful. For example, Top tips for training when they’re coming into marathon and season.
Going above and beyond with packages.
Let’s say you’re a physiotherapy practice and you are regularly treating post-surgical patients who are likely to need a lot of rehab. Maybe you are a private dermatologist to treats acne that requires regular medication and blood monitoring?
Can you offer a package of care?
For example, 12 appointments for the price of 10. Make sure its priced at a level that means that you don’t lose out. That way the patient knows they’ve got a bargain and you know you’ve got ‘buy-in’ from the right kind of people.
Start your conversation about prices with patients by saying ‘thank you’ to your patients for their loyalty and remind them how far you’ve come together. Explain that you are developing your expertise all the time, in order to help them and remain confident in you’re asking for a greater fee.
If you’re fabulous at your job (and I’m sure that you are), your patients will be more than happy to honour your expertise with their payment.
Don’t delay, announce that change today.
If you need some more help or reassurance to increase your prices like a Private Practice Ninja get in touch and let’s have a natter…
Together we can grow your Private Practice.
email or call us 0207 993 6425