Average Transaction Charge (ATC)/ Average Invoice – What does it really mean?

Many people have utilized this Key Performance Indicator (KPI) for many reasons.  Some use it for comparison between clients by a single doctor, some use it for comparison among doctors, and some use it to compare hospitals.  However, this KPI can be very misleading.  Let us first discuss how ATC can be affected across all cases, and then we can break down what it means in each of the three cases above. In this first of four posts, we will discuss how ATC can be affected.

ATC is affected by complexity of the procedure, price increases, and discounts (both manual and automatic).  In fact, many hospitals use price increases to affect their ATC to keep it in line with published guidelines.  All things being equal, this makes sense, but as prices increase, they can spend the same amount of money, but either change the number of times they visit or change the products they use.  For example, in general practice, some clients will come in yearly.  If prices continue to increase, a client might choose to only come in every 3 years.  That client’s ATC will increase (they still spend money), but the number of visits will significantly drop. Clients may also opt for medical therapy instead of procedure. When examining hyperthyroid cats, it is very important to examine the cost relationship between an I131 procedure vs the medical therapy.  Increasing the price of the I131 will definitively increase your ATC; however, you may find more people switch to medical therapy. Depending on how they get their medication, a practice may not notice a decrease in ATC from the switch, especially with the advent of the online pharmacy. These are just some of the examples of how ATC can reveal false confidence that increasing ATC has positively affected the hospital health.

We have ignored how “targeted” price increases can falsely affect ATC due to client preference and finances and how these affect therapy choices.  That discussion will be for another post.

Have any questions, don’t hesitate to contact me or leave a comment!

Practice Information Management Systems

Please let us know what system you most would like a review of?

PIMS Survey

Please rate your interest in TotalVet reviewing the following practice information management systems*
From 1 to 5 where 5 is I need to absolutely know, tell us what you want to our team to focus on.*
Please enter your name: (optional):
Please enter your email for follow up (optional):
Word Verification:
Want to contribute or add: Contact me @ info @ Totalvet.net. Follow us at the @TechVet
Tech Nerd theme designed by FixedWidget