Steven Babitsky, Esq.
One of the most frequent questions I am asked by physicians when I teach How to Start, Build, and Run a Successful Consulting Practice is: How much should I charge?
Setting fees is always a challenge for physician consultants. Here are the criteria physicians should consider when setting their fee:
Are you highly qualified to help the client deal/solve the problem they are hiring you to deal with? The more qualified you are, the more flexibility you have in setting your fees.
I worked with an ophthalmologist who was asked to help a medical device company with a coding issue for a new product. As the physician was a national leader in the field, he could and did command an enhanced fee.
How much is at stake?
Normally, the more that is at stake for the client, the higher the fee the physician consultant can command. This may be about financial risk, but can also involve reputation, good will, etc.
Time involved in the assignment
Physician consultants will want to consider the time the assignment will take them as only one factor in setting their fees. The fee should not necessarily only be on a multiple of the physician’s hourly rate.
Example: Orthopedic Surgeon
I worked with an orthopedic surgeon who was asked to perform due diligence on a new product for a medical device company. After consultation, the surgeon based his fee on complexity, travel, time, his contacts in the industry, potential future assignments, the hundreds of millions at stake, and his unique position to do an excellent job. NOTE: after performing this assignment at a high level he obtained additional assignments from the client.
What others are charging
Too many physician consultants look to what others are charging to set their own fees. In my opinion, this can be a mistake. The physician consultant contacted by the client was selected amongst the million available physicians. The client has already indicated that they want the physician contacted. Physician consultants should not be anchored by the fees that others are charging as this will often shortchange the physician.
Hourly rate vs. flat fee
Many physician consultants automatically assume they should be charging by the hour. This can be a mistake. Most experienced consultants charge a flat fee based on the assignment as they feel they are worth more than an hourly fee.
Setting fees for physician consulting is not an exact science and can be challenging. Physician consultants will want to take a holistic look at what they bring to the table when they set their fees.
About the Author
Steven Babitsky, Esq. is the President of SEAK, Inc. He created and teaches the course, How to Start, Build, and Run a Successful Physician Consulting Practice. This course is also available to stream, click here.