EP023: Pros And Cons of Having a Case Fee vs. an A la Carte Fee

Welcome to the Perfect Practice Podcast where we share the most innovative strategies to help you build a successful functional medicine business, attract your ideal patients, serve your community, and get paid what you're worth. Each episode is packed with practical steps that you can take to immediately grow your influence and serve more people. Our mission is to share golden nuggets from successful practitioners, technology experts and innovators from around the world. Your host, Sachin Patel is a functional medicine success coach, international speaker and best selling author. He's calling in all his favors to bring this information to you so you can create your perfect practice.

Hello, hello, what is up? This is Satchin Patel and welcome to another awesome, insightful and hopefully inspirational episode of Perfect Practice. For full transparency, I'm actually sitting in my infrared sauna right now made by Sunlighten. No, they don't sponsor my show just yet, but shout out to them because I absolutely love this thing and it enables me to reflect and to sweat it out if you will. Typically, you know, journaling. And that's what I was doing prior to recording this. I was journaling about this topic and here I am ready to present it to you. So today I'm going to be discussing the pros and cons of having a case fee versus a a la carte or pay as you go fee functional medicine practice. So just for full disclosure, I've tried both and I found that what worked best for us and the patients that we see and our own personal mindset and belief systems and values was working in a case like setting. And the reason for that is because, at least in my opinion, and again, this is my experience. So I'm just going to share with you what I know and certainly you can layer and pepper your experience on top of it and you interpret this and execute and implement based on what it's worth for you. So with that being said, I just want you to know that we charge case fee. And of course, because that's my decision for our practice and based on our practitioners as well, there's going to be a bit of a bias. But I'm going to try to present this fairly from my perspective and I certainly welcome your input. So let's go through the pros and cons. So the pros of having a case fee are in my opinion, both for your patient and for your practice, and thirdly for you, for your peace of mind as well. So you can really help people and not be operating out of a state of fear and scarcity all the time and instead approach each day with love and compassion. And I'm going to share with you why that's important, but also how that happens when you charge a case fee. So let me go through these. I've got several, and I'm going to just spend a few seconds talking about each one and then we'll present the other side, and then I'll present some closing thoughts. So plan for about 20 minutes or so. This will probably be a worthwhile 20 minutes, and you can certainly speed up the pace if you want, if you're listening to this in a podcast. So here's the thing. When you charge a case fee, you have better cash flow. So if I wanted to make $30,000 in one month, there's a few ways I can do that. I can see 100 patients and charge them $300. Okay. So I can see 100 different patients and have to charge them all, you know, essentially, you know, $300. I'm sorry. So that's a lot of work, right? It's 25 patients a week and those patients just don't show up. The other option is I can sign up 10 people on a brand new case. Okay. So the cool thing about that is that 10 people onboarding is generates $30,000 versus 100 people onboarding paying $300. Think about the magnitude of work. 100 intake forms, 100 new patient visits, 100 new patient consults, 100 new patient forms that need to be processed and uploaded. So think about the amount of staffing that's required for that. If you were onboarding 10 new patients a month, you could probably handle that on your own. You're pretty good to go. Now, one thing to keep in mind from an accounting purpose, you can't spend all that money, but you've got it. And what you've also got in the bank is patients that are going to show up for their appointments. You also get somebody who's probably a little higher quality. Not as a human being, I understand that, but as a client in your practice. And what I mean by higher quality is somebody who's going to be more compliant, somebody who's probably better and more deeply invested in your process and believes in what you do. Not just one appointment at a time, but eight appointments at a time or six months at a time instead of an hour at a time. Right? It's a big difference if I'm investing an hour into your practice versus I'm investing six months into your practice. And so you have to be aware of that and super conscious of that, that's a huge difference. When you Think about the type of person and the paradigm of the person that's going to come in to see you. Usually somebody who can afford the $3,000 is also going to be able to afford the follow up work that's required. The testing, the supplements, the purchases for their home, the upgrade of their blender, whatever they need to do to really get speed, keep that in mind as well. So they're not just investing in you, they're investing in other areas of their health that they're going to need to bring up to par. So you have to be very transparent and upfront about that. So you get a better quality patient, you get somebody who's more compliant, somebody who is accepting responsibility, they're accepting the challenge, they're showing a deep level of trust in you and in your process because again, they're making a six month investment versus a one hour investment. You're also going to spend less time chasing people down for their follow up appointments because they're already invested. So it goes without saying, if you've already paid for it, then there's an exponential increase, not a linear increase, but there's an exponential increase in the likelihood that you're going to show up for all of your appointments. Now think about it this way. Your goal isn't just to help people feel normal. At least that's not our goal. Our objective is not for someone to hey, feel normal again and then go on living your normal life. We want to take your life to a whole new level. Like we're going to up level your, your life. So you know, there's value in every single appointment. It's not just about how you're feeling, it's about, okay, what are you doing now that you're feeling amazing. And so we want people who are committed to that process, committed to that paradigm, committed to that vision of a better life for themselves. And that, hey, I'm investing eight hours, you know, into this, you know, one on one. But I'm really investing six to eight months, really the rest of my life into this process. And somebody who gets that is not going to complain about the $3,000 or 5,000, whatever you charge them because they see the tremendous amounts of value that you're offering them. It's not about price. Now I understand some people can't afford your services. And listen, if they can't afford the $3,000 and they're in pretty rough shape, you're not going to get them better because it's going to take way more than that to fix them. And depending on the condition that they're in. I mean, some people can fix themselves. That's one thing that we are very clear about, is that we want our patients to learn how to fix themselves. And if they can't fix themselves based on all the free stuff that we give away to them, then yeah, then they've got a more challenging case. And it's going to require expertise and it's going to require coaching and mentoring and, and it's gonna require a relationship, not just a one night stand, for them to get better. So you're gonna spend less time chasing people down. And that's important for your staff. Listen, if you've got somebody who's chasing people down for a living or that's even 20% of their job is making confirming appointments and stuff like that, I mean, nobody wants to do that. Nobody grew up saying that they wanted to call follow ups and make sure people show up for their appointments okay? No matter how much you pay that person, nobody wants to do that job. So hand it off to the robots, right? You get better, compliant patients, get people who prepay, and then you don't have to pay someone to chase these people down. There's an inherent cost associated to that. Not just the cost of paying somebody, but the opportunity cost of that person, not who's fully aligned with your mission. And that person is not able to align, you know, fully into it because they're too busy chasing their tail and trying to get people to come in. Another pro with having people enter into a case is you develop deeper relationships with that person. You're going to see this person over the next six months to a year and you're really going to get to know them. You're going to get to know the seasonality in their life. You're going to get to know how to best support them. You're going to see them more than your best friend. And so, you know, you bring on the right patients who really love and value what you do, it's really going to increase your quality of life. You're going to show up every day knowing that, hey, I've got 10 appointments scheduled today, or five or six. They're all going to show up, they're all going to be present, they're all going to be excited, they're all going to be ready to take action and they're all going to be ready for their next appointment. I'm not even thinking about it because I don't have to. They've already pre committed to it. So prepaying is pre Committing, that's what you have to understand. And then you know, you also have better communication with people who are on a case fee. Now you might say, well, I respond to my patients emails all the time. Well, great, you're not getting paid for it, so you're not doing them a favor because they're probably emailing you when things get really bad or they feel guilty when they email you versus getting compensated for it by building it into your case fee. And then people don't feel guilty. And you can feel good about it too. You're not annoyed when people message you, they're execute or implementing rather your services. And you should feel good about that. Okay. Versus the opposite. When you're paying a la carte, you're either paying per email, which means you never get one, or you know, that person is reluctantly emailing you because they don't want to bother you, or they don't take it. You know, they don't leverage it because they don't feel like they can. So you never get the same outcome as somebody who's in constant communication or consistent communication. So there's much less guilt on your side and the patient's side. From my experience, because we have better compliance, better buy in. We have the available resources to do what's necessary for the patient, for them to upgrade their home as necessary and their lifestyle as necessary, even better quality food as necessary. We get better outcomes. And listen, my job is not to help people that are not willing to help themselves. And I would like to think neither is yours. So give away as much free information that people can do to help themselves. It knocks 80% of people off the list. So you can help all those people for free. Some people will have people pay $300 an hour to tell them stuff that I tell them and their patients and publicly for absolutely free. So don't make your appointments about stuff like that. If you're somebody's paying you $300 an hour to tell for you to tell them to go to bed at 10 o' clock at night, you're ripping. That's what's ripping people off. Okay? So I believe that when people are doing the foundational stuff, they come to you for the more intelligent and highly intellectual stuff. That's the stuff that I hope you're spending time on with your patients, not telling them Mickey Mouse stuff in your appointment. So the Mickey Mouse stuff, give it away. The stuff that people can do for themselves, give it away. That's what we do and that's how we help people for free. So in case you're wondering, well, you don't help people unless you're in a program with you. No, we give away millions of dollars worth of content and information for absolutely free because we understand the magnitude of the problem is there's not enough of us to help people, but the people that we are going to help. Because functional medicine is in an early stages of its adoption, we need effective outcomes. We can't have, you know, half ass outcomes. We need full on amazing outcomes. And in order to do that and to prove functional medicine to society and get viral growth and hit critical mass, we need amazing outcomes, not people who dabbled in it. And you know, even practitioners had dabbled in it and patients had dabbled in it and never got results. So I'm looking at this from the future of our profession perspective as well. Now another thing that happens is when you have people that are pre committed. So let's say somebody signs up and they sign up for an 8 to 12 visit package over the course of a year. Well, that person is booked into your schedule every visit or every, you know, every couple of visits. You book them in a couple times and what ends up happening is you don't have to replace that person with somebody else. Find a new client. I mean, that's exhausting. So you can spend time and energy seeing patients instead of constantly seeking new patients. Okay, you really have to have a lot of new patients in a pay as you go model and see a lot of patients in a pay as you go model for this to really work. And so I don't really recommend it. Now another thing that happens is you have way less overhead when your patients are prepaying way less transactions. You know, there is, there's way less calling of people. So you don't have to have a staff member doing that. That staff member could be spending that time and energy and passion doing something else. And so your overhead goes down significantly. And then you also have decreased overhead because reminders can be sent by technology. So you can send email reminders or text message reminders and your staff can spend more time on nurturing people that have bought into you and into your practice and into your mission instead of chasing people down. Okay? So again, think about it from every perspective. Think of it from cash flow. Think of it from your mental sanity. Think of it from a marketing perspective. Think of it from your staff's perspective. Think of it from a paperwork perspective. And you know, all these things come into play. Now another thing that happens when people are in a case is that because you have better cash flow and you're not scrambling to pay people. You can actually deliver a much better experience. You can hire better talent because you have better cash flow. You can create an extraordinary, an amazing, outstanding, you know, exceptional experience for people because you can throw things in for them, because your efficiencies allow you to reinvest back into the patient. And if you had $100, you know the challenge. I always ask my practitioners, if you had $100, would you invest it on nurturing your existing patients who know, like and trust you and believe in you and your mission and your vision, or would you spend $100 on Facebook advertising? Well, I spend it on or invest it into my existing patients. And so by doing that, you can create better experiences. And those people refer other people just like them, so you get more referrals, in my opinion. And you also have a better predictability of investment. And when you work with people in a case by case basis, they have a better understanding of what it's going to cost. And instead of kind of having this question mark around it, and that question mark can make them really nervous. You also have a better educated patient because somebody who's going to invest 3, 5, $10,000 in your practice or in your programs or whatever you charge, you might be charging 1000 or 1500. Start somewhere. I started at 1500 and actually I started 2500. Then I created multiple programs, went down to 1500, and now it's at a minimum 3000. Because we deliver just so much value, and that's what we want to do. We don't raise our prices, we raise our standards, we raise the bar every time we do that because we can deliver so much more for people. You know, at the end of the day, that money can be better utilized by you for the patient than the patient for themselves. You know, that's the case. We can use that money and do something better for the patient than they can do for themselves. And that's why they're giving it to you, because they see you as an investment. So those are some of the pros. Pretty compelling argument, I would say. Let's think about some of the cons. So the main con really is that, you know, people have to be able to afford being able to pay up front. Now, here's what I'm going to say. Very rarely is it actually money, okay? It's how badly somebody wants it, because they probably drove into your office in a car that they could sell and buy something cheaper that pays for the difference. So there's lots of ways that people can pay for what you're offering. It's never about the $3,000. Listen, not to be crass or rude, and I understand some people get to that point, but that's not your fault. That doesn't mean that you should do what's not right for them because they can't afford it. You should do what's right for them and maybe help them in getting that money. Maybe you direct them to somebody you've arranged for your local financer who can help them finance it, or your bank who you've worked out a deal with, or you find out if they qualify for no interest credit cards don't become a third party bank. I don't suggest you do that. So we don't offer any financing for our patients because there's plenty of institutions that do financing better than we do. And you know, so we, we provide outsources where people can do that. But we still want to get paid in full because we want to deploy all of our resources all at once, not in a linear fashion. When you get paid in a linear fashion, you deploy in a linear fashion and you only can, because otherwise you go bankrupt. But when you get paid in full, you can deliver in full. That's huge. So think about that. Everyone on your team can be mobilized to help that person because everyone on that team can get paid. But if they can't get paid, then they can't get mobilized. And that's very critical for you to recognize. So if people can't afford your programs, then they probably can't afford what's necessary to get them better again. And if they blew all their life savings somewhere else, that doesn't mean again you do what's not right for them. You have a process. You have a belief system. You have a vision, you have a mission. You have this person getting on a rocket ride to Mars. They can't stop halfway. They can't like change their mind every couple hundred thousand kilometers if they're going to stay on board or not. They've committed to getting to that planet and you've committed to getting to that planet. You're going to spend more time chasing these people down for their appointments. They're going to have a higher miss rate because they're not invested in being there. And they don't plan around it. They plan you out, not around it, when they have to pay for it. That's just human reality. Okay? I can't change that. I don't see that changing anytime soon. Now there are Some unicorns that do show up. Don't let those people fool you. Just like we don't want outliers making decisions for our practice, we don't want outliers on either end of the spectrum making decisions for our practice. You're going to have more missed appointments, appointments, more free time in your schedule, and you're going to have more frustration and you're going to have more anxiety because you're not. You don't know if some people are going to miss or not because they haven't paid. You also have decreased cash flow. As I mentioned earlier, the example I gave you, if you wanted to go from 0 to 30,000, the only way you do that is in your first hundred appointments. I could probably do it even if I sucked in my first 50 appointments. Okay? So I could generate that much revenue. And then the next month I can do it again. The next month I can do it again. The next month I can do it again. So at 10 patients a month, which is totally realistic, okay, one patient, you know, really every three days, which you should be able to do, if you're giving it your all, then you're doing pretty good. You're in a much better position versus three new patients every day for 30 days. Or in the case of, if you're working five days a week, that's five new patients. That's a lot of work. Five new patients a day. Chew on that. That's a tough one. So I can't see how this makes any sense from a cash flow standpoint. And then we can't hire talent. You're going to be broke for how long are you going to be broke for before you can hire someone and bring somebody on board. The other thing is you're going to have decreased compliance because patients are going to make wishy washy decisions based on when they want to show up. That's the reality of the world we live in. So I can't change that. Certainly your drop off rate is going to be way higher than somebody who's prepaid. Yes, some people prepay and they ask for refunds, but it's a very small percentage of people. The other thing too is, you know, your, your staff is again chasing people down and not, you know, not necessarily networking with them. So the number one reason I find that most practitioners don't charge a case fee is because they're concerned about people saying no. That's the only reason. Guys, let's face it, you're not doing yourself, your practice, your patient any favors by not getting them to fully commit to the process. I mean, let's, let's be real about this. You know, that's the reason. If you had a choice between the two and the resistance was the same, the effort was the same, you would definitely want them to prepay you. And of course they prepay. And you have a refund policy. We have a refund policy. If something doesn't work out, then we have a way of refunding that money to you. So you're not fully committed. If you want to get off for whatever reason, or we uncover that, hey, this wasn't the right decision, let's give you your money back, then we can totally do that. We have a very transparent refund policy. So that brings me to my first point is transparency. We're very transparent with our pricing. Nobody comes into our office without knowing what the investment's going to look like, what the commitment's going to look like, time wise, financially, emotionally, you know, physically, environmentally. We let people know, like you're hiring us because we're the best. You're not hiring us because we're the cheapest and we're going to be totally transparent. We're very proud of our pricing. I challenge you to go anywhere else on this entire planet and give somebody $3,000 and get more value out of it. I 100% challenge you. And if you can do that, then I will quit my business. I will close the doors and I will just refer people to that person. Because I cannot imagine anyone delivering as much value as we do for this price point with the amount of experience we have. Okay? So totally ridiculous. When you really, you know, when you really point it out to people. And then, you know, you also want to be proud of your pricing, not shy away from it. Right? Words that you can use to minimize your pricing should you want to, is only 29.97. Just 29.97. You know, that's important. And you also want to pay attention to when you present your price that you have confidence, your voice doesn't drop. You don't have a deflection in your voice. You have an inflection in your voice and you feel good about it. Right? That number should roll off your tongue, not out your butt. So just keep that in mind. You got to feel good about what you charge. Don't charge what I charge. Charge what somebody else is charging. Charge what you feel comfortable with, your experience, your knowledge, your ability to deliver, you know, your commitment to the patient, what you want to offer to that person. You know, look at my program as a template, but, you know, tune it and tweak it to make it your own, because that's what you're going to feel good about selling. You know, I put this whole program together with my team, so I feel comfortable charging triple what we're charging now. But we don't feel like we need to do that. We feel like we want to reach as many people as possible. And one way that we can increase and streamline our business and make it more profitable is by increasing efficiency and also increasing the number of people that we see. Now, charging a case fee in and of itself is a great barrier of entry because it keeps people out who are going to be a drain on your battery, on your practice's battery. So be proud of your pricing and be very clear with who your avatar is, because for the right person, this program is going to be priceless. For the wrong person, it's going to be worthless. It's going to be a complete waste of money, time, energy, effort. And you know, those mental faculties are very valuable. So you don't want to be wasting yours either. You also want to address any objections that you might think somebody would have. So maybe if you charge a case fee, tell people why you charge a case fee. I just give you some very compelling reasons why you should charge a case fee. So I would highly encourage you to even have a slide in your pre webinar consultation as to why you charge a case fee. Why it's beneficial to the patient. And if you explain that to somebody, they're going to want that. We do it because ultimately it's beneficial to the patient. It's ultimately hinging on the fact that they get an outcome. And we can't get an outcome if they don't commit and we don't see them as much as we need. And then, you know, you want to be always honest and compassionate. Okay? So by being compassionate, what you do is you tell people the truth. You tell them not what they want to hear, but what they need to hear for change to take place for them, to improve their quality of life. If somebody can't afford your program, don't do what's wrong for them because you think that that's right for them and that's what they think is right for them. Do what's right for them. Tell them to save up. Give them some guidelines, you know, challenge them. Because if they save up for it instead of getting a layup for it, then guess what, they're going to be way more committed. They're way more grateful. They're going to appreciate it so much more because they stretch themselves. And you know, a stretch goal for some people is saving up the money. Let them stretch, let them grow. So you know, there's so much that I can say about this. I hope this gives you some insights. I love your feedback and there's no right or wrong way to do this. But again, this is the type of decision making, level of quality check that I go through to make decisions. I don't make them lightly. I don't make statements lightly as to why one is better than the other. I've tried both, like I said, and you couldn't pay me even if I, even if I doubled my prices, you couldn't pay me to go through a pay as you go type of program. Alright, so that's my take. Hope you enjoyed this episode. If you did leave some comments, give me some feedback. I'd love to hear what you have to think. Give us a five star rating if you're enjoying the information that I'm sharing and share this with your colleagues. You know, the people who share the most win and we want to win over healthcare. We need more people thinking this way and at least getting their juices flowing, getting the wheels turning, the hamster wheel turning in their mind so they can think about the whole system a little bit differently. With that, I love you and let's do our best to live the most amazing life possible. Peace out. This is Satchin Patel, Talk to you soon. Bye.