Telemedicine Cost Savings Calculator for Practices

Telemedicine Cost Savings Calculator for Practices

Stop making uninformed decisions about your telemedicine investments. Many practices struggle to accurately calculate the cost savings from telemedicine due to incomplete data and assumptions. Without precise figures, it’s easy to overlook expenses like staff training, technology setup, and ongoing maintenance. Let’s be real—most people guess and end up with misleading results. You need clarity if you want to see real benefits.

How to Use This Calculator

Forget the basic steps. The real challenge is sourcing the correct numbers. Look at your historical data. Gather figures for patient visits, average costs per visit, and your overhead expenses. Dig into your practice management software or accounting records. If you don’t have this data, you’re essentially flying blind. And let’s not even start on the time wasted on erroneous calculations.

Variables Explained

1. Average Cost Per In-Person Visit: This includes all direct costs associated with a traditional office visit. Think about staffing, utilities, and any consumables. Don’t just pick a number out of thin air—analyze your billing records.
2. Number of In-Person Visits per Month: Reflect on your recent patient traffic. If you’ve seen fluctuations in visits, adjust for seasonal trends.
3. Telemedicine Setup Costs: Include software subscriptions, hardware, and any training expenses. Remember, this isn’t a one-time expense. Factor in any ongoing costs.
4. Expected Reduction in No-Show Rates: If you’re implementing telemedicine to reduce no-shows, quantify this. Track your statistics pre- and post-implementation.
5. Overhead Costs: This is where many practices get it wrong. Include everything from rent to utilities. These hidden costs can significantly impact your bottom line.

Case Study

For example, a client in Texas decided to implement telemedicine to manage their growing patient base. Initially, they estimated a 20% reduction in in-person visits. They gathered their average in-person visit cost of $100 and tallied up 300 visits a month. With telemedicine, they invested around $2,000 in setup costs but saw a drop in no-shows by about 30%. The results? A clear path to savings they had previously overlooked.

The Math

The formula to calculate your savings is straightforward. Subtract the total telemedicine costs from the total savings generated by reduced in-person visits. The real work lies in gathering accurate data. Once you have your numbers, plug them into the equation:

Total Savings = (Average Cost Per Visit * Number of In-Person Visits * Reduction Percentage) - Telemedicine Setup Costs.

💡 Industry Pro Tip

Here’s something most people miss: always revisit your calculations after six months. Your initial numbers might change as you adapt to telemedicine. Adjust your expectations and re-evaluate your ROI. This isn’t a set-it-and-forget-it situation. Continuous improvement is crucial.

FAQ

• What if I don’t have historical data? Collect estimates from similar practices or industry benchmarks. It’s better than guessing.
• How do I know if telemedicine is right for my practice? Analyze your patient demographics and needs. If convenience is a priority for your patients, it’s worth considering.
• What overhead costs should I include? Include everything that keeps your practice running—rent, utilities, staff salaries, even insurance. Ignoring these can skew your results.
• Can I use this calculator for larger practices? Absolutely. Just adjust your inputs based on your specific scale and needs.