A provider's panel supports a raise when the revenue it brings in covers their full cost, the raise included, with room left for the practice. Check that with real numbers before the conversation, so your answer is based on the panel and not on a feeling.
Start with what the panel brings in
You need the provider's panel size and the revenue from it, after discounts and card fees. Count only active, paying members, and use three months instead of one so a single good or bad month doesn't skew it. If your books or platform can't split revenue by provider, set that up first. Without it, you're guessing.
Then their full cost
Salary is only part of it. Add employer payroll taxes, benefits, malpractice insurance, licenses, CME and any software seats tied to them. That's what the practice pays for this provider each month. If you don't have exact numbers, start from last year's payroll reports and insurance bills.
A made-up example
Say a provider has 450 members at an average of $80, which is $36,000 a month. Their full cost is $15,500 a month. Their share of rent, staff and other overhead is $12,000.
That leaves $8,500 a month for the practice. A raise of $1,500 a month, plus about $150 in added payroll taxes, takes it to $6,850. That still leaves solid room, so the panel supports it.
Now say the same provider has 300 members, bringing in $24,000. After their cost and overhead, the practice has minus $3,500 a month. A raise widens the gap. The better move there is a plan to grow the panel, with a raise tied to a member count.
Ways to tie pay to the panel
- A raise at a set panel size, like 400 or 500 members.
- A bonus paid quarterly on members above a target.
- A move from flat salary to base plus a share of panel revenue. This post compares those setups.
Pay that rewards panel growth gives the provider a clear path and keeps the raise affordable.
Things that aren't in the numbers
Retention matters. Replacing a good provider costs time, money and members. A raise the panel barely supports can still be the right call if it keeps the provider. Make that choice knowing the cost. Ask what the provider wants, too. Sometimes it's a better schedule, not more pay.
What I'd do this week
- Pull the provider's panel size and revenue for the last three months.
- Total their full monthly cost.
- Subtract their share of overhead and see what's left.
- Run the raise through the same math before you meet.
Common questions
How do I split overhead between providers?
Share it by panel size or by days worked. Pick one method and use it every time so the comparison stays fair.
What if the provider's panel is shared with mine?
Agree on how members are assigned first. Without that, revenue by provider isn't reliable.
Should a raise be permanent?
A salary increase usually is. A bonus tied to panel size can move up or down with the panel.
Want revenue by provider in your books?
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.