Dr. Tea  0:01  

Practicing medicine without insurance is possible. Imagine a private practice where you get to see your best patients every day, providing medical services you truly enjoy, all without the hassle of insurance. My name is Dr. Tea Nguyen, and I'm a recovering specialist who was completely burned out from insurance based medicine. I pivoted into direct care, where patients pay me directly for my medical services, and have never looked back. If you're a private practice owner or planning to become one who's looking to be free of the grind of insurance and you're craving it, simplicity, efficiency and connection with patients, you are in the right place. This podcast will help you map out your exit plan and uncover the mindset needed to thrive in today's economy. Welcome to the Direct Care Podcast For Specialists. 

Dr. Tea  0:53  

How do you set your prices for your direct specialty care practice and the services you provide when direct care started, it actually came from direct primary care. So you can check them out, DPC alliance.org, I have no affiliation other than I love their model. So these were a group of doctors or colleagues who left the insurance practice to practice in a more simple way, by offering a monthly membership and patients get access to the doctor as they need. Now, that could mean that they access their doctors during normal business hours, or it could mean that you're available to them after hours. That's totally up to the doctor, and that's the point I want to make when I tell doctors that I function kind of like a concierge Doctor, where I'm more available than their insurance options. I'm not saying that I'm gonna wake up at three in the morning to refill a prescription or answer a question about a throbbing pain that just has been present for the last eight months, right? I'm not doing that. I'm making it very clear what I offer to the patient, and I write that out on paper, and you'll be surprised that a lot of patients are very considerate of the doctor's time. They are always starting off a text message, for instance, with me saying, Sorry, I know this is on the weekend, or sorry to bother you after work hours. So generally speaking, at least the patients that come to me, they are considerate. And I think that's what Direct Care offers, is that it kind of attracts a certain type of person if you have the right kind of messaging.

Dr. Tea  2:31  

So going into how do you actually price your services? There's a couple of ways, and I'll give you the most basic way to follow, and then you can, over time, decide to adjust it. That's at least how I viewed it when I started my practice was the same questions you have: how do you know what to price your stuff? So right now, you're going to see more and more doctors list their prices online, and that could be a good starting point to decide, what is it actually worth to the public? I have a twist on this. So you can start with what your insurance rates are. If you're happy with those rates and you just don't want to deal with insurance, but you want to do what they do, that would be okay. So you can start with the consultation at a couple $100 . I think it's reasonable to start once you start getting a feel for what it actually feels like to get paid cash without the burden of billing insurance and paying all the people in between, then you can start adjusting for what people are receptive to. The caveat to this is you don't really know what people are going to tolerate paying you until you become more well known for what you offer. What I mean by that is, if you haven't created demand yet, you have to create it right, which means you have to see more patience. 

Dr. Tea  3:51  

You have to acquire those online reviews. You have to be prominent in your community. That's the best way to grow when a lot of people know what you do, and then over time, you start creating demand, which then allows you to raise your prices. What you don't want to do is set your price really low as an anchor point to attract people. So some things to consider if you price yourself as the lowest available option. You're going to attract people who want things for very low prices, practically for free. And you will find that if you attract that type of person, that type of person who only chose you because you are the cheapest conversations thereafter, and the people you continue to attract will only value you because of your price point. They don't care who you are as a person, necessarily. They don't care about the value that they are really getting at the end of the day. And I hear doctors argue. You talk about this back and forth where they want to price the lowest, but maybe you're the type who needs to learn through experience. When you price yourself low, you're gonna get a level of headache that you wish you never invited. I'm just gonna say that flat out, because you'll see when you price yourself low. They don't really respect you because you don't respect you, there's going to be more incidences of no shows because you haven't really shown them the value of what you offer. You haven't been selected for a certain type of personality. Let's just say you haven't set the bar for your practice. If you set the bar really low, guess what is going to come right in, right those people who only care for you for being the lowest price, and then guess what? 

Dr. Tea  5:52  

You are now competing for the bottom dollar, which means if somebody else shows up at a better price, they're gone. They're out of there. Okay, so that's what you're kind of creating for yourself. And in a sense, when we did take insurance, we were technically the lowest priced with the highest overhead, right? So consider that price, it in a way that reflects your value, your expertise, that it respects to your profession, many will say that if you don't price appropriately, then obviously they're not going to value humans have this way of thinking where the higher you price your stuff, the more valuable it appears to be. And you might even see this in various industries. For example, there's a grocery store in LA who overpriced everything like we all know that, but it screens for or it attracts a certain type of demographic that wants to be in that level. So yeah, it's not going to attract the person who wants to shop at the dollar store, right? Because that's not their thing. Their thing is being high priced. And so it selects for a certain demographic, the people who have the money to pay for it, it's kind of like a club. So that's the perception of money and value. The higher your price, the more value it is perceived. And I've seen this with myself, where I chose to work with a certain consultant because they had a higher price point, and in my eyes, I thought they must know a thing or two, right? I want to make sure that I get the best experience possible, and that price will reflect that. So medical services should be priced in a way that is respectful of your craft, but also enough to pay off your overhead and have profits at the end of the day, because that's how businesses function. 

Dr. Tea  7:42  

You need to be able to have profits to reinvest, to continue to grow and evolve and expand your reach for people who need you, or you can decide to take that money and put it into a charitable organization, do whatever you want with that money, but you got to make a profit, so price it appropriately. I had a colleague tell me that she has a very difficult time asking people for money, like it makes her hands sweaty, and so she'll just give stuff out for free, like the tangible things we sell in the office. She'll just hand it out and make no issue about it, and then she walks away kind of ashamed that she knows she's gonna get yelled at by her office manager. She knows that that wasn't the best strategy to owning a business, but she did it anyway, and she continues to do this over and over again and walking away as if it's not a big deal. In reality, it is a big deal because it's not just that money that is lost, that opportunity lost, but it's also the tone that you set for future doctors, the precedence that you set when you set your practice up in such a way where you don't really put value in what you do and what you offer and what you sell. So I don't know how the doctor felt when I said that, when I said you're setting the precedents for future generations, if you don't know how to have those Awkward Money conversations. And the reality is, you know, as a consumer, people want to pay for stuff. They want to get the thing, and it requires the payment for that. And I know for me, I love to spend money. I just feel really good when I can spend money on a person who gave me great care, or they did something that I thought was amazing, something that I definitely would not be doing. It gives me pride to be able to show that I can afford certain things. So when I buy something, it makes me feel good. But also, when I buy something like a service, it also requires a commitment on my end. When I make the transaction, I make the commitment to make sure that I see through to the thing that I'm paying for, like a gym membership, if he ever purchased a gym membership. It's gone unused. Well, how does it make you feel it doesn't make you feel good, right? 

Dr. Tea  10:05  

So you will be sure that if you pay a lot for something, for a gym membership, let's just say you're gonna make sure you're gonna make the most out of it and utilize it at least four times a month, or whatever it is, to ensure that it's worth every single penny. So that's the funny thing about money, is it's not just how you perceive it and the bias you put into it, but you got to be aware that other people view money very differently. Some people are happy to spend. Some people want you to stay in business. I've had patients tell me, please make sure that you stay around, because my other doctors seem to keep disappearing, and so I'm happy to pay you. I want to make sure that your business is successful. Money is an issue only when you make it an issue. It's really not an issue to the outside world, where they need the thing and they know they have to pay for it. There's a certain population who expects a bunch of things for free. So if you don't charge enough, or you're giving stuff away for free, you're setting the tone that you don't have a lot of value to bring, and that's just what it is. So how do you price it well, to stay afloat, to not just survive, but you really want to position yourself to thrive, because what can you do with a lot of money? There's no such thing as too much money, I don't think in our world. Because what happens when we do have a lot of money? We can do so much good with that money. We can donate, we can sponsor, we can reinvest, we can do things that help us in our business, but also make us feel really good about our contributions to our community. And it doesn't really matter what you decide to do with that excess money. It's really nobody's business, right? Nobody needs to know what you do with your money on your own time. If you find yourself in a position where you feel guilty asking for money, you have just placed your own personal bias onto somebody else, and many times, it's a little offensive. It's offensive to assume that people do or do not have money to spend on things that they may or may not value. That's all there is to it. And I remember hearing a story about this business owner, she's a multi millionaire, and she was talking about how she was in line with a stranger, and a stranger had mentioned purchasing something, but then he says to her, it's really expensive. And when you say things like that to a total stranger, you've made the assumption that they can't afford it. And she responded with, Well, luckily, I'm rich, and I thought that was such a flex to just own it, to say, You know what, money is not my concern. And really, who has anybody to think about what we value and what we want to spend on, like, if it's any other business, how do you know if something is expensive or not? You only know it from your own lens, but you don't know it from another person's lens, and you really shouldn't be judging them for that, right? So somebody might say to me, $30,000 is a lot of money to spend on a consultant, and while that may be true, I'm willing to invest in that. Or better yet, $250,000 is really expensive to invest in a medical degree, but we did it anyway, right? Because we found value in it. Maybe we were the first generation to be able to go into medicine, to have that privilege to take out a loan and leverage that, to be able to get something we deeply wanted, and we know that would pay itself, we would be able to help lots of people by making that investment. So looking back 250k to be where I'm at, totally worth it. I wouldn't have been here. If I didn't have that ability to take out a loan, I wouldn't have met all the people that I do know now. If I didn't take that opportunity to borrow the money to get those experiences, I wouldn't be able to say, Yeah, I know a friend in all states. I can go nationwide across the country, visit with whoever, reminisce over old times, all the things, these are privileges that I got to have because I was able to leverage my debt for experiences, and I have no regrets about it. I'm able to travel the world because I was able to leverage my debt for those experiences. So anyway, looking at how you price things, just price it appropriately. Take a look at your needs. What are your overhead expenses from month to month? Do an annual report, and then do an anticipation report as to how many patients you think you can see. And sometimes it's the experience of you doing it for you to kind of nudge your numbers up or down. I recommend continuing to go up so that it matches with inflation. And so if you're. Starting from nothing, and you really don't have any patience, and you're wondering how you should price your stuff. Just kind of look at your neighbors, look within your community, as to what other doctors are charging for cash services like a consult. And start there. Nationwide, I would say doctors can charge about $500 an hour for their time, and that was kind of my benchmark. I'm in California, so maybe because of the cost of living, I can go a little bit higher, and maybe in more rural communities, you can go a little bit lower. It really depends on your circumstance. It depends on your expenses and a couple other factors too. Now, could you charge a little bit more because you have a little bit more skills, more training, probably, but I would say you first want to be able to get your name out there. So that might look like you're giving a lot of community talks for free. It might look like you're giving 15 minute consultations for free, just so that you can learn how to navigate this new business ownership process where you're trying to decide who is actually a good fit for my practice. You really don't want to be there for everybody. You want to be there for people who respect you, who has a problem that you can solve, and they're willing to pay for it, and you will find many doctors will often underprice themselves, and so that's kind of to your advantage. 

Dr. Tea  16:23  

You start with something, and then you start moving along and having those money conversations. And eventually you get to the point, and you realize that your price is just your price. It's what is needed to make your business work through these exercises of deciding what your price point is, over time, you're going to realize that you're going to have to increase your price because maybe you like to buy a bunch of new stuff. You like technology. You want to implement new things that work. You know you have to decide as you go month to month as to whether or not that price point makes sense. Is there such a thing as a price point that is too high? Possibly, which is why I always invite you to consider doing 15 minute meet and greets on the phone, just to get to know people in your community, what their pain points are, what you can actually help with, or what options they have, and maybe they're better served with an insurance option. I feel like that is the most compassionate thing we have to offer as a doctor is to give them options and to make sure that you screen for who you can help and who you can't help. And the people you can't help are those who are just unwilling to pay or simply they don't see value in what you have to offer. And that's totally okay. 

Dr. Tea  17:36  

Listen, this is going to take time to develop if you are new to business ownership. These are just kind of the lessons that you need to learn along the way, how to have difficult money conversations, how to deal with the objections when people think your prices are too high, and then really knowing the price point that it's going to work for your practice. I'm going to share with you a little bit of magic to make all of this work. The magic in making your business be sustainable long term is in creating a signature package that has a very high price point. So maybe your consultation prices are a little bit lower than these signature packages, but if you focus on one singular package that has a higher price point, that will help your practice be anchored to reliable income or reliable revenue. What I mean by that is, in my practice, I have one membership price for $3,000 in order for a patient to be established with me and have a certain number of visits with me. And I was able to develop this over time, because in the beginning, I didn't know what a membership would look like for my kind of practice, a podiatry practice, but the more patients that I saw, the more that came to see me, the more that were willing to pay. They made it easier for me to figure out what my signature package was going to be, and so being able to focus on that one high ticket offer made all the difference in my direct specialty care practice at the time, I actually didn't know that's what it was called. I was just creating a package that made it easier for me to help patients by paying one price instead of monthly charges. And I was surprised to see patients were absolutely willing to pay for what they perceived as a deal, because if they paid up front, they would get a discount versus paying on a monthly basis. So just planting the seed for you to think about how to price things. You're first going to price your consultation at a certain dollar amount, and then think about the type of packages you want to sell that has a higher price point, so that when you start paying into marketing, you're going to really just focus on that high ticket price point down the road. If you don't have one already, that's something to think about. If you do have packages priced, maybe think about raising your prices a little bit each year so that it matches inflation and the rising cost of. Business, and then down the road, you can start anchoring your business with this membership, whether you choose to charge them monthly or in full, like I do, that's going to help you so much more down the road, but it may take time for you to get there. If you're starting from nothing, if you've not had any business experience, if you've not had a lot of patience, and so on. 

Dr. Tea  20:20  

Now, if you do have your practice and you're just looking to increase your cash flow, it's the exact same thing. You have a package service, you put a sticker on it, and then you tell people what it costs to get what they need. I hope that this is helpful in giving you guidance as to how to price your stuff. There's a lot of options there, I know. But to make it very simple, look around your community to see what's happening. Get out there, get your name out there. Provide the best service you possibly can, and over time, you will create the demand where you can then increase your prices as you see fit. So just make sure you price it in a way that respects your specialty, your craft and your business, that's all I have for today. I look forward to chatting again next week. Take care. 

Dr. Tea  21:07  

If you enjoyed this episode, please give it a review and share it with a friend so more doctors can learn about direct care. Let's keep the conversation going on LinkedIn so we can help more doctors escape insurance and thrive in private practice. Thanks for listening. I'll talk with you next time. Take care.