Family caps and pricing tiers bring members in, but some of them cost you more than they pay. Measure what each tier brings in per member and how much care it uses, and you'll know which ones pay for themselves.
Why tiers get out of balance
Most practices set tiers at opening, often by looking at other practices. Over time the panel shifts. A family cap that made sense with a few families can strain things when large families sign up. A tier for older members can fill with people who need a lot more visits than you planned for.
Discounts pile up the same way. A founding member rate, a teacher discount and a family cap can all land on the same household.
What to measure for each tier
- Members in the tier.
- Monthly revenue from the tier, after discounts.
- Revenue per member in the tier.
- Visits, messages and other care per member per month, if your EHR or platform reports it.
- Included costs per member, like labs or meds you cover.
- How long members in the tier tend to stay.
A made-up example
Say adults pay $85 a month, and families are capped at $250 a month no matter how many kids.
- A family of three pays $250, about $83 per person. That's close to the adult rate.
- A family of six pays $250, about $42 per person. That's half the adult rate.
If kids visit less often, the larger family might still work. If they visit about as often as adults, each large family takes up a lot of your time for half the revenue. The numbers tell you which.
What you can change
- Raise the cap or add a per-child price after a set number.
- Adjust one tier's price at renewal instead of changing everything at once.
- Keep current families at their price and use the new price for new sign-ups.
- Keep the cap as a marketing choice, but know its cost.
Any change to existing members needs care and notice. This post shows how to test a price change before you announce it.
How the books help
If all membership revenue sits on one line in your books, you can't see any of this. Ask your bookkeeper to split membership revenue by tier, or at least by individual, family and employer. Here's why employer revenue gets its own line.
What I'd do this week
- Export your member list with each member's tier and monthly price.
- Work out revenue per member for each tier.
- Pull visit counts by tier if your system has them.
- Circle any tier where revenue per member is well below the average.
Common questions
Should I get rid of family caps?
Not automatically. They can bring in families who stay for years. Know what they cost so the choice is deliberate.
What if I can't track visits by tier?
Start with revenue per member. Even without visit data, that number shows where each tier sits.
How often should I review tiers?
Once a year, or any time the panel's mix changes a lot.
Want to see revenue by tier every month?
We reconcile every account every month and send your P&L and Balance Sheet by the 15th, so decisions like this start from real numbers. If that's what you need, apply to work with us.