Time-Based Clinical Pricing: How to Calculate Fees Smartly and Profitably in Your Practice

Admin
Sep 24
3 min read

Get Rid of Guesswork: Value Your Time and Increase Profit Margins by Understanding the Real Impact of Each Clinical Minute

Introduction

Pricing healthcare services is one of the greatest challenges in managing medical and dental practices. Many professionals still define their prices by comparing with competitors or relying on subjective perceptions. While common, this practice often hides silent losses, erodes profit margins, and prevents sustainable growth.

A safer, more strategic, and fair alternative is to adopt time-based clinical pricing. This method calculates how much each minute of care costs—and how much it should generate—allowing practices to optimize fees and improve profitability.

Why Guesswork Pricing Is Dangerous

When prices are defined only by “what the market charges” or by copying a competitor, the manager faces serious risks:

Charging fees below the real cost.
Underestimating the time required for each type of care.
Building a price list misaligned with the financial reality of the clinic.

Practical example:At a dental clinic, evaluation consultations were charged at around US$150, aligned with the local market. However, the calculation of clinical time and operating costs showed that the service actually cost US$180 per hour when considering supplies, infrastructure, and fees. In other words, the clinic was losing money on each evaluation.

How to Calculate Real Clinical Time

The first step is to determine how much it costs to keep the clinic running per hour. This includes:

Fixed expenses: rent, salaries, utilities, software, cleaning.
Variable expenses: materials, supplies, commissions.
Professional’s hourly cost: owner’s compensation or market-based fee.

Numerical example:A clinic with fixed monthly costs of US$60,000 and 200 available clinical hours per month has a fixed hourly cost of US$300. If a consultation lasts 40 minutes, the minimum cost of that service must be calculated proportionally to the time consumed.

This calculation should also consider:

Total time of the appointment (not only the technical procedure).
Room preparation and turnaround.
Shared hourly costs (administrative staff, sterilization, etc.).

Long Consultations vs. Short Procedures: The Cost of Opportunity

Longer appointments do not always bring higher profitability. Managers must analyze the opportunity cost: by occupying the schedule with a long procedure, what revenue is the clinic giving up in the same time frame?

Practical example:In a dermatology practice, a 20-minute aesthetic consultation generated an average of US$400. A longer, one-hour clinical procedure generated US$600. By comparing revenue per hour, the aesthetic consultation delivered US$1,200/hour, while the clinical procedure yielded only US$600/hour.

This analysis helped the clinic reposition prices and adjust scheduling to prioritize more profitable services—without compromising quality.

How to Improve Profit Margins Per Time Spent

To optimize profitability based on real clinical time, managers can:

Restructure the price list using cost/hour calculations.
Prioritize services that deliver higher revenue per hour.
Adjust scheduling to reduce idle or unproductive time.
Create bundled packages to optimize time use and increase average ticket size.

Practical example:In a dental clinic, simply reorganizing the schedule—prioritizing high-value treatments during peak hours—increased monthly net margin by 15% in four months.

Conclusion

Time-based clinical pricing is one of the smartest and most sustainable strategies for practices seeking financial security and growth. Moving away from “guesswork” and superficial competitor comparisons allows clinics to build a solid, fair, and operationally aligned pricing policy.

In addition to protecting profit margins, this model helps managers make more strategic decisions about scheduling, prioritization of procedures, and creation of packages that maximize the value of applied time.

A clinic that truly understands the real cost of its time can compete healthily, invest confidently, and build a financially sound business for the long term.