Your monthly membership price is probably the single most important number in your entire DPC business plan, and getting it right from the start matters more than almost any other decision you will make in the early days. If you set it too high you are going to have a really hard time convincing patients to sign up, especially in a market where people are not yet familiar with what DPC is and why it is worth paying for out of pocket. On the other hand, if you set your price too low you will end up needing to fill a much larger panel just to break even, and that defeats the whole purpose of DPC because you will find yourself right back on the hamster wheel of seeing too many patients in too little time.
KNOW YOUR MARKET
DPC pricing varies quite a bit depending on where you are in the country and what the local economy looks like. Practices in expensive urban areas like San Francisco, New York, or Boston can reasonably charge somewhere in the range of $100 to $200 a month for adults, while practices in smaller cities and rural communities typically land in the $50 to $85 range, and the national median across all DPC practices sits right around $85 a month for an adult membership.
Before you settle on your price, you should take some time to research every other DPC practice within about a 30-mile radius of where you plan to open. Find out what they are charging, try to get a sense of how full their panels are, and if there are no other DPC practices in your area you should look at comparable markets in cities of a similar size to get a feel for what patients in your region might be willing to pay.
THE FINANCIAL MODEL
The most reliable way to find your price is to work backwards from what you actually need to earn, and here is how that looks in practice. First you want to figure out your target annual revenue, which is your desired salary plus all of your overhead plus a reasonable buffer for unexpected expenses. Your overhead for a typical solo DPC practice will run somewhere around $10,000 to $15,000 a month once you account for rent, staff salaries, technology, malpractice insurance, and supplies. Once you add your desired take-home pay on top of that, you divide the total by your target panel size, which for most solo physicians is going to be somewhere between 400 and 600 patients, and the number you get is what you need to charge on average per patient per month.
So for example, if your overhead comes to $200,000 a year and you want to take home $300,000, that means you need $500,000 in total revenue. Divide that by 500 patients and you get $1,000 per patient per year, which works out to about $83 per patient per month.
TIERED PRICING
Most DPC practices that are doing well use some version of age-based tiered pricing, which makes sense because older patients generally need more care and younger patients need less. A common structure looks something like children at $25 to $50 a month, young adults from 18 to 39 at $50 to $85, adults from 40 to 64 at $75 to $125, and seniors over 65 at $100 to $150 a month, with family plans getting a 10 to 20 percent discount for households of three or more.
This kind of tiered approach works well because it keeps the practice accessible to younger and healthier patients who balance out the panel while still making sure you are being fairly compensated for the additional time and resources that older patients tend to require.
THE PSYCHOLOGY OF PRICING
One of the most common mistakes that new DPC physicians make is undervaluing their own services, often because they feel guilty about asking patients to pay out of pocket or because they are nervous about scaring people away with a price that seems too high. But it is really important to remember that you are offering unlimited access to a board-certified physician for less than what most people spend on their streaming subscriptions combined, and that is an extraordinary amount of value that you should feel confident charging fairly for.
There is also a somewhat counterintuitive dynamic at play here, which is that patients who pay $50 a month tend to undervalue the service and actually use it less than patients who are paying $85 or $100 a month. A slightly higher price point can actually improve patient engagement because people tend to take something more seriously when they are investing a meaningful amount in it, and that leads to better health outcomes for them and a more sustainable practice for you.
WHEN TO RAISE PRICES
It is a good idea to plan from the beginning to raise your prices by about 3 to 5 percent each year, and you should communicate this to your patients clearly and in advance so it never feels like a surprise. Many practices choose to grandfather existing patients at their current rate for 6 to 12 months when a price increase goes into effect, which is a nice gesture of loyalty that patients really appreciate and that helps with retention.
When you are just getting started, it is much smarter to set your initial price at a level that works financially even if you only have 300 patients, which is roughly where most practices land at about the 12 to 18 month mark, rather than setting a low price that only makes sense once you have built up to 600 patients. You can always sweeten the deal for early adopters by offering a founding member discount or a special rate for the first patients who sign up, which gives them an incentive to join early without locking you into a price that is unsustainably low for the long term.