What Is The Cost Per Encounter?

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What Is The Cost Per Encounter?

Description:

This KPI shows your practice cost per encounter.

​Why is This KPI Important?​

This KPI is important because it helps you ascertain the cost to provide care for each patient you see. This becomes a valuable statistic when you are negotiating with managed care companies so you know what it will cost you on average to provide care to a child - especially in capitated contracts!

PMI Recommended Frequency to Run this KPI:

Monthly

Formula:

Total Operating Expense / Office Encounters

Show the Math:

$450,000 / 5,000 = $90.00

How Should I Track It?

This KPI can be tracked using an Excel spreadsheet by Practice and/or Department if you categorize expenses properly.

 

 
Picture of Paul Vanchiere, MBA

Paul Vanchiere, MBA

For over 15 years, Paul has dedicated himself exclusively to addressing the financial management, strategic planning, and succession planning needs of pediatric practices. His background includes working for a physician-owned health network and participating in physician practice acquisitions for Texas's largest not-for-profit hospital network, giving him a distinctive insight into the healthcare sector. Paul is adept at conducting comprehensive financial analysis, physician compensation issues, and managed care contract negotiations. He established the Pediatric Management Institute to offer a wide range of services tailored to pediatric practices of all sizes and stages of development, with a focus on financial and operational challenges. Additionally, Paul is actively involved in advocacy efforts to ensure healthcare access and educational opportunities for children with special needs.

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